North American railways are poised to regain large chunks of the freight business they started losing to the trucking industry in the late 1970s, the head of Canada's largest rail company says.

"If rail's not doing well now, we're probably not going to do well -- and I'm serious," Hunter Harrison, chief executive officer of Canadian National Railway Co., told an investor conference in New York yesterday.

"The stars are set up for this industry going out the next five, 10, 15 years to make big, big leaps and regain market share."

Mr. Harrison cited "some of the problems that our friends in the trucking industry are having," including soaring fuel prices, labour shortages "and quality of life and risk management issues."

He also said, however, that some potential customers, who have built new plants since abandoning rail cannot "make the shift overnight" because they did not design the facilities with rail transport in mind.

CN and Canadian competitor Canadian Pacific Railway Ltd. have seen business and their stock prices take flight in the past 2