CN orders 65 new locomotives, doubling 2007-2008 total to 130 new units

New locomotives will increase fleet efficiency, reduce fuel consumption and emissions

MONTREAL, June 21, 2007 — CN (TSX: CNR)(NYSE: CNI) announced today it will acquire 65 new fuel-efficient, high-horsepower locomotives in 2007 and 2008, in addition to 65 locomotives already on order for delivery this year.

CN's latest orders are for 40 ES44DC locomotives from GE Transportation Rail, a unit of General Electric Company, and 25 SD70M-2 locomotives from Electro-Motive Diesel, Inc. The GE units will be delivered between December 2007 and February 2008, with the EMDs arriving in August 2008.

CN previously ordered 50 SD70M-2s for delivery between August and October 2007, and 15 ES44DC units to come in November of this year. The SD70M-2s produce 4,300 horsepower, the ES44DCs 4,400 horsepower.

E. Hunter Harrison, president and chief executive officer, said: “The new locomotives will help CN to improve the efficiency and reliability of its fleet, reduce fuel consumption significantly and lower exhaust emissions. Rail is the environmentally friendly mode, and our new locomotives will further enhance our environmental performance.

“The new units are about 15 per cent more fuel efficient than the locomotives they will replace, and will comply fully with the latest regulatory requirements for reduced locomotive emissions. The latest locomotive orders announced today will permit CN to retire 145 older locomotives.”

The new locomotive orders are part of a major fuel conservation program by CN, which spent almost C$900 million on fuel in 2006.

The 65 locomotives CN previously ordered for this year will be largely used to accommodate growth in traffic from the new Port of Prince Rupert container terminal, scheduled to start operations in October of this year.

All of the 130 new locomotives CN has ordered for 2007 and 2008 will be equipped with distributed power capability, which allows them to be placed in the middle of a freight train and to be remotely controlled from the lead locomotive.

Distributed power technology improves fuel efficiency and train handling, and permits CN to maximize the productivity gains associated with its extended siding program.

This news release contains forward-looking statements. CN cautions that, by their nature, forward-looking statements involve risk and uncertainties, including the assumption that, while CN expects a moderate slowdown in the North American economy in the near term, its business prospects assume positive economic conditions in North America and globally, and that its results could differ materially from those expressed or implied in such statements. Important factors that could cause such differences include, but are not limited to, industry competition, legislative and/or regulatory developments, compliance with environmental laws and regulations, various events which could disrupt operations, including natural events such as severe weather, droughts, floods and earthquakes, the effects of adverse general economic and business conditions, inflation, currency fluctuations, changes in fuel prices, labour disruptions, environmental claims, investigations or proceedings, other types of claims and litigation, 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 CN's most recent Form 40-F filed with the United States Securities and Exchange Commission, its Annual Information Form filed with the Canadian securities regulators, and its 2006 Annual Consolidated Financial Statements and Notes thereto and Management's Discussion and Analysis (MD&A), for a summary of major risks.