CN makes new offer to locomotive engineers' union in an effort to end the
strike in Canada

MONTREAL, Dec. 1 /CNW Telbec/ - In an effort to break the impasse with the Teamsters Canada Rail Conference (TCRC) and end the strike, CN (TSX: CNR)(NYSE: CNI) today made a new offer to the TCRC.

Contrary to the TCRC's claim this morning, CN has not seen substantive movement by the union to end the locomotive engineers' strike that started Nov. 28, 2009. Unfortunately, the union persists in raising the same issues the parties have negotiated for 14 months.

In a good faith effort to reach a settlement, CN is offering to:

    
    -   Agree to binding arbitration on wage and benefit issues, and

    -   Roll-back the 4,300-mile monthly cap for locomotive engineers to
        3,800 miles, on the condition that the TCRC withdraws its work-rule
        demands from the bargaining table.
    

CN notes the TCRC previously offered to submit the wage portion of the dispute to final and binding arbitration upon successful resolution of the other outstanding issues.

If the TCRC agrees to CN's offer today, the company would be pleased to draft an agreement for resolution of the labour dispute.

Forward-Looking Statements

This news release contains forward-looking statements. CN cautions that, by their nature, forward-looking statements involve risk, uncertainties and assumptions. Implicit in these statements, particularly in respect of long-term growth opportunities, is the Company's assumption that such growth opportunities are less affected by the current situation in the North American and global economies. The Company cautions that its assumptions may not materialize and that the current economic conditions render such assumptions, although reasonable at the time they were made, subject to greater uncertainty. The Company cautions that its results could differ materially from those expressed or implied in such forward-looking statements. Important factors that could cause such differences include, but are not limited to, the effects of adverse general economic and business conditions, including the current deep recession in the North American economy and the global economic contraction in 2009, industry competition, inflation, currency and interest rate fluctuations, changes in fuel prices, legislative and/or regulatory developments, compliance with environmental laws and regulations, actions by regulators, various events which could disrupt operations, including natural events such as severe weather, droughts, floods and earthquakes, labor negotiations and disruptions, environmental claims, uncertainties of investigations, proceedings or other types of claims and litigation, risks and liabilities arising from derailments, and other risks detailed from time to time in reports filed by CN with securities regulators in Canada and the United States. Reference should be made to "Management's Discussion and Analysis" in CN's annual and interim reports, Annual Information Form and Form 40-F filed with Canadian and U.S. securities regulators, available on CN's website, for a summary of major risks.

CN assumes no obligation to update or revise forward-looking statements to reflect future events, changes in circumstances, or changes in beliefs, unless required by applicable laws. In the event CN does update any forward-looking statement, no inference should be made that CN will make additional updates with respect to that statement, related matters, or any other forward-looking statement.

CN - Canadian National Railway Company and its operating railway subsidiaries - spans Canada and mid-America, from the Atlantic and Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key metropolitan areas of Toronto, Buffalo, Chicago, Detroit, Duluth, Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis, and Jackson, Miss., with connections to all points in North America. For more information on CN, visit the company's website at www.cn.ca.

SOURCE CN

For further information: For further information: Media: Mark Hallman, Director, Communications & Public Affairs, (905) 669-3384; Investors: Robert Noorigian, Vice-President, Investor Relations, (514) 399-0052


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