Marketing Strategy & OutlookJack Koraleski, EVP – Marketing and Sales

2

$10.9

$11.6

$12.9

$14.8

$15.5

2003 2004 2005 2006 2007

Strong Growth PerformanceRevenue$ Billions

2003 - 07 CAGR

Revenue 8.9%

Volume 1.3%

ARC 7.5%

GDP

3

0.7%

1.5%

5.2%

6.9%

2003 2004 2005 2006 2007 2008E

Core Price Improvement

6.0% 5.0 - 6.0%

4

Customer

Satisfaction

Customer

Value

Focus On the Customer

Resources

Process

Improvement

Capital

Investment

5

Customer Satisfaction

64

72

79

2005 2006 2007

Overall Satisfaction at Post-SP Merger Record

15 of 35 Questions at BestEver Levels

Competitive

Prices

Local

Switching

NCSC Problem

Resolution

Corrective Action

(Transportation)

Consistency

Transit Times

(Last 12 mos.)

Key Satisfaction Drivers(2007 vs 2006)

Satisfaction Index Improvement

Overall

+10

+4

+13

+7

+13

+9

+6

6

The Strength of a Unique Franchise

Portland

LosAngeles

Calexico

NogalesEl Paso

Seattle

Eagle Pass

LaredoBrownsville

HoustonNew Orleans

Memphis

OmahaSaltLakeCity

Eastport

Twin Cities

Denver

Dallas

KansasCity

Duluth

St. Louis

Diverse Business Mix

Fastest Growing States

Port Access

Border Crossings

Energy

20%

Autos

9%

Agricultural

Products

17%Intermodal

19%

Industrial

20% Chemicals

15%

Business Mix

Oakland

Vancouver

7

HermosilloChihuahua

Monclova

Torreón

SaltilloMonterrey

Culiacán

SanLuisPotosí

Tampico

Querétaro

VeracruzCoatzacoalcos

Puebla

Salina

Aguascalientes

Guadalajara

Manzanillo

LázaroCárdenas

MexicoCity

Salina

Mérida

Brownsville

Mexico … A Key Link

Nogales

Laredo

Eagle Pass

Calexico

El Paso

$0.89$0.97

$1.11

$1.37$1.44

2003 2004 2005 2006 2007

61%

Revenue Growth($Billions)

8

Linking Production and ConsumptionAgricultural Products – $2.61 Billion Revenue (2007)

Access

Major Grain andProduce Regions

Flexibility to MeetDemands of the Market

Ethanol

Feed/Processors

Export

Infrastructure

Refrigerated Boxcar Fleet

Major Grain &

Grain Products

Region

Grain

Export

Grain

Export

Produce

Dairy,

Poultry

Cattle,

Poultry

Cattle,

Poultry

Dairy

Dairy

Cattle

Grain

Export

Produce

9

Linking Production and ConsumptionChemicals - $2.29 Billion Revenue (2007)

Storage-in-Transit

Major Classification Yard

Soda Ash /Trona Ore

GulfCoast

EastportLine

Access

Chemical Gulf Coast

Wyoming Soda Ash /Trona Ore

Eastport Line /Canadian Interchange

PNW and Gulf Ports

Infrastructure

Gulf Coast

5 Major Classification Yards

10 Major Terminals

6 Storage-in-Transit Facilities

Port

10

Linking Production and ConsumptionEnergy - $3.13 Billion Revenue (2007)

• Access

– Most Abundant, LowestCost and Secure FuelSource

• SPRB (72%)

• Colorado/Utah (17%)

• Other (11%)

– River Terminals &West Coast Ports

• Infrastructure

– Cycle Time Advantagefrom SPRB to Chicago,St. Louis, and Texas

UP Coal Network

SPRB Coal Utility Plant

CO/UT Coal Utility Plant

SPRB & CO/UT Utility Plant

Water Port Coal From CO/UT

Water Port Coal From SPRB & CO/UT

11

Linking Production and ConsumptionAutomotive - $1.46 Billion Revenue (2007)

• Access

– 7 Assembly Plants

– 38 Auto Ramps

– Vehicle Ports

– Mexico Market

• Infrastructure

– 30%+ Ownership ofFleet

UP Distribution Centers

Private Distribution Centers

Assembly Centers

Gateways to Mexico

Ports

12

Linking Production and ConsumptionIntermodal - $2.93 Billion Revenue (2007)

• Access

– Route Advantage:

• Fast Growing LA-Texas/Southeast Market

• North/South Lanes

• PNW - Memphis

• Northern California – Chicago

– West Coast Ports

– Mexico Border Crossings

• Infrastructure

– New Terminals

– EMP Box Ownership

13

Linking Production and ConsumptionIndustrial Products - $3.10 Billion Revenue (2007)

• Access

– Lifeline of the Economy

– Over 200 Lumber Mills

– Extensive Coverage ofMineral Deposits

– Rock Network

• Infrastructure

– Manifest Network &Terminals

Lumber,

Paper

Aggregates

Copper &

Other

Non-

Ferrous

Minerals

Industrial

Sand

Lime

Lumber,

PaperLime,

Aggregates

Major Terminals

14

Key Opportunities for Growth

Global Demand

Growing Dependenceon Rail

Legacy Contracts

15

Global Demand: Energy

World Demand for Coal

0

25

50

75

100

125

150

175

200

225

1980 1990 2000 2010 2020 2030

Qu

ad

rill

ion

BT

Us

U.S. Electric Power

Generation by Fuel Type

0

500

1,000

1,500

2,000

2,500

3,000

3,500

1980 1990 2000 2010 2020 2030

Mil

lio

n K

ilo

wa

tt H

ou

rs

Coal

Nuclear

Natural Gas

Renewables

Petroleum

Source: Energy Information Administration – Energy Outlook 2007

57%

16

Global Demand: EnergyCoal

Renewed

Eastern

Demand for

Western Coal

Western

Market

Development

Far

East

Export

Growth

Europe Export

Growth via River

Mexico

Market

Base

Midwestern

Growth

Seattle

New Orleans

LongBeach

Oakland

EaglePass

Memphis

Chicago

St. Louis

17

Global Demand: EnergyTransmission Pipeline

North American

Pipeline Expansion(Miles)

1,4601,152

1,781

2,410

3,974

3,353

4,753

2005 2006 2007 2008E 2009E 2010E 2011E

UP Pipeline Express (Carloads)

1,960

6,054

8,490

2005 2006 2007

PipelineExpress

PipelineExpress

Industry Sources

18

Global Demand: EnergyFrac Sand

Frac Sand(Carloads)

9,950

13,333

17,366

20,809

27,334

2003 2004 2005 2006 2007

U.S. Rig Count

1,108

1,3031,415

2005 2006 2007

Source: Baker Hughes

19

Global Demand: EnergyWind Turbines

Wind Turbine Carloads

743921

2,700+/-

2006 2007 2008

Outlook

0

20

40

60

80

100

2005 2007 2009 2011 2013 2015

Source: Energy Information Administration, 2008

Estimated Wind Electrical

Generation(Billion KW Hrs)

20

Global Demand: EnergyEthanol

Origin Base

68% of U.S. EthanolProduction

Destination Unit TrainDevelopment

Flexible Franchise

Unit vs. Manifest

Interior vs. Forward Plants

U.S. Ethanol Production

Capacity

0

4

8

12

16

1999 2003 2007 2011 2015B

illi

on

Ga

llo

ns

pe

r Y

ea

r

Production Conventional RFS

Source: USDA Projected Production Capacity

21

Global Demand: Grain and Food

Drivers

Increasing Population

Changing Diets

Biofuels

Opportunity

Flexible Ag Franchise –Food vs. Export vs. Fuel

Meat and Poultry Exports

Fertilizer

Potash Exports

Source: USDA, 2008

World Wheat and Coarse

Grains & Milled Rice

1,800

1,900

2,000

2,100

2,200

Mil

lio

ns

of

Me

tric

To

ns

Production Consumption

1998/99 2001/02 2004/05 2007/08

22

Global Demand

Diverse Franchise CreatesOpportunity ThroughoutEconomic Cycles

Strong Dollar DrivesImports and OverallEconomic Growth

Weak Dollar Spurs ExportGrowth and Substitution ofDomestic Production forImports

Freight Revenue

First Quarter 2008

Domestic

72%

Other

Imports

11% Mexico

Imports

3%

Other

Exports

9%Mexico

Exports

5%

23

2035

Growing Dependence on Rail

Highway Congestion

Driver Shortages

Highway Infrastructure

Rail – The “Green”Alternative

Three Times More FuelEfficient Than Trucks

One Intermodal TrainCan Take Up To 280Trucks Off The Highway

Source: FHWA HPMS data

Source: FHWA HPMS Data

24

The Opportunity for Growth

Total Western Market*:

$103 Billion

Truck/Other71%

WesternRails29%

*Truck, rail, barge and air traffic – haul lengths over 500 miles

Source: Company Reports and Reebie Data

25

Auto Parts Intermodal ServiceDetroit – Mexico Bi-directional Service

Chicago

Detroit

Laredo

Mexico

Salem

Daily Seamless InterlineService Between Detroit andMexico

More Capacity Available toHandle Business Growth

Equivalent to 35,000 Trucks Offthe Highway

26

Produce Railexpress

Links Growers and Shipperswith Retail and Food ServiceDistribution

Currently One 55-Car TrainPer Week

Only Railcar Service in theU.S. Which is Faster thanRefrigerated Trucks

Starting Late 2008 –Delano, CA Facility

Wallula, WA So. Schenectady, NY

99.9%DeliveredOn-TimePerformance

15,015TruckloadEquivalents

4.4Transit Days

78Train Starts

Success Factors

Delano, CA

27

Legacy Contracts

Total Percent of Revenue

6%

3%3%

6%

8%

Re-priced

74%

Percent of Legacy Revenue

Autos

10%

Industrial Products

& Agricultural

2%Chemicals

8%

Energy

44%

Intermodal

36%

2008

2009

2010

2011

2012+

28

Going Forward

Franchise ProvidesOpportunities for Growthin All Market Conditions

Well-Positioned to Movethe Resources the WorldNeeds

Legacy Contracts

Customer Value DrivesGrowth and PriceImprovement

5-Year Outlook

CAGR

Revenue 6 - 8%

Volume 2 - 3%

Price 5 - 6%