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26
products shipments. Lower fuel surcharges due to lower fuel prices also reduced freight revenues in
2009 compared to 2008. ARC decreased 7% during the full year, driven by lower fuel cost recoveries,
partially offset by core pricing gains of approximately 5%. Fuel cost recoveries include fuel surcharge
revenue and the impact of resetting the base fuel price for certain traffic, which is described below in
more detail.
Our fuel surcharge programs (excluding index-based contract escalators that contain some provision for
fuel) generated freight revenues of $1.2 billion, $605 million, and $2.3 billion in 2010, 2009, and 2008,
respectively. Higher fuel prices, volume growth, and new fuel surcharge provisions in contracts
renegotiated during the year increased fuel surcharge amounts in 2010. Furthermore, for certain periods
during 2009, fuel prices dropped below the base at which our mileage-based fuel surcharge begins,
which resulted in no fuel surcharge recovery for associated shipments during those periods.
Fuel surcharge revenue is not entirely comparable to prior periods due to implementation of new mileage-
based fuel surcharge programs. In April 2007, we converted regulated traffic, which represents
approximately 20% of our current revenue base, to mileage-based fuel surcharge programs. In addition,
we have converted and continue to convert portions of our non-regulated traffic to mileage-based fuel
surcharge programs. At the time of conversion, we reset the base fuel price at which the new mileage-
based fuel surcharges take effect. Resetting the fuel price at which the fuel surcharge begins, in
conjunction with rebasing the affected transportation rates to include a portion of what had been in the
fuel surcharge, does not materially change our freight revenue as higher base rates offset lower fuel
surcharge revenue.
In 2010, other revenues increased from 2009 due primarily to higher revenues at our subsidiaries that
broker intermodal and automotive services. Assessorial revenues also increased in 2010 reflecting
higher volume levels during the year.
In 2009, other revenue decreased from 2008 due primarily to lower revenues at one of our subsidiaries
that brokers intermodal and automotive services. Assessorial revenues also decreased in 2009 reflecting
lower volume levels during the year.
The following tables summarize the year-over-year changes in freight revenues, revenue carloads (each
container or trailer is counted as one carload), and ARC by commodity type:
Freight Revenues % Change % Change
Millions 2010 2009 2008 2010 v 2009 2009 v 2008
Agricultural $ 3,018 $ 2,666 $ 3,174 13% (16)%
Automotive 1,271 854 1,344 49 (36)
Chemicals 2,425 2,102 2,494 15 (16)
Energy 3,489 3,118 3,810 12 (18)
Industrial Products 2,639 2,147 3,273 23 (34)
Intermodal 3,227 2,486 3,023 30 (18)
Total $ 16,069 $ 13,373 $ 17,118 20% (22)%
Revenue Carloads % Change % Change
Thousands 2010 2009 2008 2010 v 2009 2009 v 2008
Agricultural 918 865 947 6% (9)%
Automotive 611 465 667 31 (30)
Chemicals 844 761 885 11 (14)
Energy 2,056 2,021 2,348 2 (14)
Industrial Products 1,073 899 1,249 19 (28)
Intermodal 3,313 2,775 3,165 19 (12)
Total 8,815 7,786 9,261 13% (16)%