Higher Production Costs? Larger Profits?

Who exactly has the higher production costs between these two firms? CNR is a larger railroad, with more cars and therefore more workers. CPR is a smaller railroad with fewer cars and fewer workers but has been around longer. Based on this you’d think that the CNR would have larger costs and therefore have a smaller profits and the opposite would be true for CPR. Not necessarily.

CNR is a government run organization, which means a certain amount of government money may potentially go into the CNR to help reduce their costs. Also, with consumers constantly having to choose between two railways that depending on where their product that needs shipping needs to go, with choose one over the other, production costs a bound to vary with changes in demand (and customer convenience).

By looking at their third quarter reports for 2009, it appears that CNR is doing much better then CPR. However, this does not factor in implicit costs; however it does give a fairly accurate representation to the successes and difference between the two companies.

As for larger profits, it would seem that for this year, CNR is doing a little better then the CPR. However how much of success of the CNR is based on the government is very hard to tell based on these two balance sheets.

Click Here to go to CPR's financial Report. Once there please click the link "investors" and then the link "financial Reports". This is the only way for you to be able to view these reports. Sorry for the inconvenience.