July 2007
Train accidents down 17.7% in five monthsPreliminary figures released today by the Federal Railroad Administration show that train accidents on U.S. railroads dropped 17.7% in this year's first five months compared with the prior-year period, with declines of 8.0% in collisions, 12.9% in derailments, and 21.7% in yard accidents. Fatalities were down 6.9% to 322. There were improvements in both grade crossing fatalities, down 13.5% to 135, and trespassing deaths, down 5.3% to 177.
US&S CEO Burk steps down Union Switch & Signal Inc. (US&S) announced Kenneth R. Burk has stepped down as president and chief executive officer, effective today. Burk has served US&S as CEO since February 2001. Sergio De Luca, CEO of Ansaldo STS, US&S’s parent company, stated, "We would like to wish Ken Burk the very best in his new endeavors and to thank him." A search is under way for Burk's successor; Ansaldo named Emmanuel Viollet as interim CEO.
Ottawa backs Great Lakes freight corridorThe Canadian government has pledged C$2.1 billion of infrastructure funding to support the Ontario-Quebec Continental Gateway and Trade Corridor, a public-private project to raise the efficiency of intermodal freight transportation between Montreal, Toronto, and the U.S., the Montreal Gazette reports. The federal government, in concert with the provinces of Quebec and Toronto, seeks to improve eastern Canada's rail freight operations, including border crossings with the U.S. and security, to bolster global competitiveness, Transportation Minister Lawrence Cannon said. The governments will create a working committee, with input from the private sector, to study emerging trade patterns and the challenges of improving intermodal efficiency.
Bowen named Managing Editor of Railway AgeDouglas John Bowen has joined the Simmons-Boardman Publishing Corporation Rail Group editorial staff as Managing Editor of Railway Age, effective Aug. 1.
Bowen has returned to Simmons-Boardman after 16 years. He was Intermodal Editor of Railway Age from 1989 to 1991 as well as Editor of Intermodal Age. An experienced business-to-business journalist, he has worked in editorial capacities for Inbound Logistics, High Speed Transport News, The Journal of Commerce, CNN/Money, and The Deal LLC. He began his journalism career as a reporter at The Asbury Park Press, a New Jersey daily newspaper.
Bowen holds a B.A. in History from Rutgers University. He resides in Hoboken, N.J., with wife Mary Ann and son Mark. He is also president of the New Jersey Association of Railroad Passengers.
Bowen succeeds Marybeth Luczak, who is leaving Simmons-Boardman to start a family. Luczak, who joined the company in 1997, “has been a tremendous asset,” said Simmons-Boardman Senior Vice President and Rail Group Publisher Robert P. DeMarco. “We wish her the best and will miss her.”
Railway Age is the flagship publication of the Simmons-Boardman Publishing Corporation Rail Group, which also publishes Railway Track & Structures and International Railway Journal and European Rail Outlook. First published in 1856, Railway Age, with a circulation of 25,000, covers the $25 billion North American freight railroading and rail transit industry.
EPA sees continued "solid" freight car demandDespite a slowing momentum in orders during the current traffic downturn, Economic Planning Associates in a newly revised forecast says there are signs that "demand for railcars will remain on solid footing for a number of years to come." EPA cited "replacement pressures and technological advances as well as legislative measures" as reasons for optimism. EPA expects builders to deliver 66,500 cars this year and 63,000 in 2008.
Global Railway set to acquire CAD, doubling revenuesGlobal Railway Industries, Ltd., has signed a letter of intent to acquire most of the working capital and other assets of Canada Allied Diesel Co. Ltd. and its affiliates. The tentative purchase price is $22.0 million. Global Railway Chairman, President, and CEO Terry McManaman said the acquisition will double the company's revenue base to more than $65 million. "With the acquisition of the CAD assets, Global expands its customer service offering to include locomotive refurbishing and parts sales and will be able to leverage this additional range of services to expand is business with the North American Class I railroads."
New Orleans urged to grow streetcar systemDespite its severe fiscal and infrastructure woes, New Orleans should still pursue aggressive expansion of its streetcar operations, officials from the Regional Planning Commission assert. Commission Executive Director Walter Brooks is urging the city's Regional Transit Authority to support a streetcar loop serving the Loyola Avenue "corridor," one of the neighborhoods making an economic comeback, according to the Times-Picayune. The project, estimated to cost $30 million, would take up to seven years to build. But Brooks said the large number of developments being planned for the area makes the timing right to discuss the streetcar proposal. The commission has pledged $5 million to construction; federal funding is envisioned for much of the remaining cost.
Siemens lands DART substation contractSiemens Transportation Systems has signed a $30 million contract with Dallas Area Rapid Transit (DART) to provide 24 substations for DC traction power supply. The substations will be equipped with Sitras thyristor controlled rectifiers (TCR) to ensure virtually constant voltage, thus increasing energy efficiency for DART's Green Line, running from northwest to southeast Dallas. Delivery will take place between 2008 and 20010. The agreement includes an option for an additional 14 substations.
DM&E ponders its own saleAnalysts say the Dakota, Minnesota & Eastern Railroad has approached several prospective buyers, including private-equity firms and Class I railroads, over a prospective sale, the Pittsburgh Business Times reports. The discussions are prompted by DM&E's failure to finance its expansion into the coal-rich Powder River Basin of Wyoming, after the Federal Railroad Administration rejected its application for a $2.3 billion loan last February. One analyst said DM&E executives have made several presentations to potential buyers, though he declined to identify any interested parties. Pittsburgh-based L.B. Foster Co. currently owns 13.4 percent of the railroad.
New Hampshire establishes rail authorityNew Hampshire Gov. John Lynch has signed legislation creating the New Hampshire Rail Transit Authority, charged with overseeing the return of passenger rail service between Lowell, Mass., and Nashua and Manchester. Other locations within the state, such as Manchester-Boston Regional Airport, may also be considered. No specific timetable for the authority is set. Nor is funding settled; the state Supreme Court ruled in 2004 that the state constitution prohibits use of gas tax money to pay for the project. Pan-Am Railways owns most of the route linking Lowell, Nashua, and Manchester.
APTA applauds Congress for security fundsThe American Public Transportation Association (APTA) has praised congressional approval of H.R. 1, "Improving America’s Security Act of 2007," authorizing a "significant increase" in transit security funding. APTA notes the bill authorizes $3.4 billion of direct funding to public transportation agencies, without the requirement for a state or local funding match, during the next four fiscal years: $650 million for FY 2008; $750 million for FY 2009; $900 million for FY 2010; and $1.1 billion for FY 2011. H.R. 1 also authorizes funding for continuation of the Public Transportation Information Sharing Analysis Center (ISAC). APTA President William W. Millar, in a statement, urged President Bush to sign the bill.
U.S. rail operating employment dropsU.S. railroads employed 69,298 transportation (train and engine) workers in mid-June 2007, the first time this year the monthly figure has dropped below 70,000. It was down 2.31% from June 2006 and 1.53% from May 2007. Total employment in May--166,722--was down 0.55% from June 2006 and 0.68% from May 2007. The biggest percentage increase in employment this May was in the category of executives, officials, and staff assistants, up 3.78% to 10,152.
U. S. rail traffic up over prior weekU.S. railroad freight volume added up to 33.4 billion ton-miles in the week ended July 21, up 2.7% from the previous week but down 1.3% from the corresponding week last year. The weekly increase was one of the few favorable traffic comparisons the Association of American Railroads has been able to find in weeks. Compared with last year, intermodal volume in the most recent week was down 3.2% and carload traffic was off 2.2%. Seven of the 19 commodity groups showed improvement over last year, led by grain, up 8.7%; metallic ores, 8.2%; and motor vehicles and equipment, 7.4%.
Canadian railroads reported a 2.2% increase in carload traffic compared with the same week last year and a 9.3% increase in intermodal volume. Carload freight on the Kansas City Southern de Mexico was up 4.9% and intermodal was up 37.1%.
Alstom tests Nice Citadis LRT; battery includedAlstom began testing its Citadis light rail cars July 20 in NIce, France, employing a battery-powered on-board system that can supplant overhead catenary power for short distances (under one kilometer). Alstom developed the technology to enable Nice's historic center to be served without affecting the visual character of Place Massena and Place Garibaldi. Alstom said 20 trainsets will be delivered to the Nice Cote d'Azur Community of Municipalities by the end of September.
L.B. Foster income doubles as sales soarL.B. Foster Co. has reported that its sales increased 50% to $148.5 million in this year's second quarter compared with the same period last year, as income from continuing operations rose to $6.8 million from $3 million in the 2006 quarter.
President and CEO Stan Hasselbusch commented: "Overall, Rail, Tubular, and Construction Products sales were very strong and bottom line results increased across all segments. However, while our Tubular and Construction segments expanded gross profit margins, the Rail segment was hampered by lower distribution and concrete tie margins. On a positive note, Rail margins including concrete tie margins were improved over the first quarter of this year."
Harsco posts record sales and earningsHarsco Technologies reported today that second quarter sales rose 24% to $946 million from the corresponding period last year, while income from continuing operations reached a record $77.0 million, an increase of 45%. "The diversification of the operating and geographic balance of the company stood us in good stead for the quarter," said Harsco Chairman and CEO Derek C. Hathaway. "The growing strength of our Access Services Segment and the strong contributions of our recent Excell Minerals acquisition and the overall Mineral & Rails Technologies Group were very encouraging."
Hathaway was optimistic for continued strong performance throughout the company, including Harsco Track Technologies, which he said "should continue to see improved year-over-year operating performance in 2007's remaining quarters. New contract bidding activity for both Excell and Harsco Track Technologies remains high, which adds confidence to the longer-term outlook as well."
GATX Rail keeps fleet busy and earnings upGATX Corp. reported today that its GATX Rail unit earned $68.1 million in the second quarter compared with $64.0 million in the year-earlier period. The improvement was attributed to "an increased number of cars on lease, higher average lease rates, improved contributions from European operations, and increased remarketing income."
On June 30, GATX Rail had approximately 111,000 cars in its North American fleet with a 98% utilization rate vs. 98.9% a year earlier. The average term on lease renewals increased to 70 months during this year's second quarter, up from 65 months in the same quarter last year.
Pricing pressures, lower volume hurt FreightCar America earnings FreightCar America today reported second-quarter net income of $11.5 million on sales of $195.4 million, down sharply from earnings of $36.6 million and sales of $365.4 million in the second quarter of 2006. The company said the decline "reflects lower volume and the impact of a more competitive pricing environment."
FreightCar America received orders for 2,262 new cars in the second quarter compared with 3,763 for the corresponding 2006 period. The backlog of unfilled orders was 5,589 units on June 30 compared with 6,606 on March 31 and 16,846 on June 30, 2006.
German states resist DB privatization plansGermany's Die Welt newspaper reports a growing number of German states are opposed to the proposed partial privatisation of Deutsche Bahn AG, approved by the German cabinet Tuesday. The current plan calls for the government to divest 25% of the company, worth an estimated $4.1 billion, by the end of 2008. Die Welt said the states unhappy with the plan, at least in its current form, include Hesse, Saxony-Anhalt, Saxony, Brandenburg, Rhineland-Palatinate, North Rhine-Westphalia, Berlin, Hamburg, Saarland, and Lower Saxony. The proposal must be approved by the German legislature, but the states collectively could carry enough political clout to block the bill, particularly in the upper house, or Bundesrat, which may consider the measure in October.
Wabtec sales and earnings riseWabtec Corp. today reported its 13th consecutive quarterly earnings increase, noting earnings per diluted share were up 33% above second-quarter 2006 levels. Net income for the quarter was $28.1 million vs. $21.1 million for the comparable period a year ago. Second-quarter sales increased 24% to $326 million, attributed by the company primarily to growth in its Transit Group. Wabtec also projected 2007 sales growth estimates of 16%-to-18%; its previous target was 12%-to-14%.
Kansas City Southern shows earnings strengthKansas City Southern today reported a 3.4% increase in second-quarter revenue, at 427.1 million, over the same period a year ago, which it attributed to strong pricing. KCS' operating income of $83.1 million was up 7.2% over the 2006 second quarter, while its operating ratio improved to 80.5% compared with 81.2% in the year-ago period. The company's automotive group business increased 17.8%, as Mexico's influence on the North American automotive industry continues to grow. Coal revenue rose 10.4% on strong volume.
New York places billion-dollar subway car orderThe Metropolitan Transportation Authority of New York voted today to exercise options to acquire an additional 620 subway cars for New York City Transit at a cost of more than $1.1 billion. Delivery is to take place in 2008-2009. In Paris, Alstom announced that it would supply 360 R160 cars for approximately $675 million. The cars will be assembled and tested in Hornell, N.Y. Body shells will be manufactured at Alstom's Lapa facilities in Brazil. Kawasaki will supply the remaining 260 cars.
FEC shareholders approve buyout planShareholders of Florida East Coast Industries Inc., the parent company of Florida East Coast Railway, overwhelmingly have approved a $2.2 billion buyout offer from New York-based private equity group Fortress Investment Group LLC. Nearly 99% of the shares voted were in favor of the transaction. The deal is scheduled to close on Thursday.
Route cost climbs for nuclear waste haulingA government plan to construct a 319-mile rail route through rural Nevada to carry nuclear waste now sports a price tag of $3.2 billion, and the cost is expected to increase before groundbreaking occurs, according to the Department of Energy. The route from Caliente in eastern Nevada to the Yucca site in Nye County, about 100 miles northwest of Las Vegas, carried a cost estimate of $2 billion in December 2005 of $2 billion, the Las Vegas Review-Journal reports. The rail cost estimates, a small portion of the overall funding required for the proposed waste handling facility, include an equipment yard, maintenance facilities, a train control center, and sidings to connect the line to existing track in Caliente, according to a DOE transportation document.
Norfolk Southern notches increased earningsNorfolk Southern Corp. today reported second-quarter earnings increased 5 percent to $394 million, compared with $375 million in the second quarter of 2006. Revenue of $2.38 billion dipped slightly from $2.39 billion in the prior-year period. The company said general merchandise revenue grew 1 percent during the quarter, as higher revenue per unit offset a decline in traffic volume, which fell 4 percent vs. the second quarter of 2006. NS attributed the decline to weakness in the automotive and housing industries. The company said its second-quarter operating ratio of 71.0%, an improvement from 71.7%, was its lowest for a second quarter since the 1999 absorption of Conrail properties.
All 98 Railpower units due at UP by July 31Railpower Technologies announced today that all 98 refurbished road switcher locomotives ordered by Union Pacific are expected to be delivered by July 31. So far, 90 units have been shipped. UP has indicated that all units shipped before the end of July will be accepted. The $C94 million contact was awarded in 2005. "This is a tremendous achievement as we designed this new product according to the client's specifications and will have delivered 98 locomotives in less than 24 months," said José Mathieu, president and CEO of Railpower.
Poland orders Bombardier double-deckersA suburban network operated by Koleje Mazowieckie in the Mazovia region of Poland has placed a $76 million order with Bombardier Transportation for 37 new generation double-decker coaches of a type already popular in Germany, where 1,600 are in daily operation, as well as in Luxembourg, Denmark, and Israel. Delivery is to be completed in 2008. Features include full climate control, multi-purpose compartments, wide entrances, and low-floors in intermediate coaches to facilitate access for riders with special needs.
Despite strike, CPR posts strong resultsCanadian Pacific today reported operating income for the second quarter that was 9% higher than in the second quarter of 2006 and an operating ratio that improved to 74.7% from 75.0% last year. "We produced 12% growth in diluted earnings per share and posted further improvement in our operating ratio in spite of a 26-day strike and tough weather-related operating conditions," said CP President and CEO Fred Green. These comparisons do not reflect foreign-exchange gains in long-term debt and certain other items. Strong global demand for bulk commodities produced double-digit growth in sulphur, fertilizer, and coal traffic in the second quarter. Grain traffic was up 9%, industrial and consumer products were up 6%, and intermodal was up 3%. Operating expenses increased 7% owing mainly to a 21% increase in fuel costs. "We still face some significant challenges through the rest of 2007 with rising fuel refining margins and the strengthening Canadian dollar," said Green. "However, with continued focus on our Integrated Operating Plan, we expect to deliver on our targets." Excluding special items, CP's outlook for earnings per diluted share remains in the range of $4.30 to $4.45 for 2007, compared with EPS of $3.95 in 2006.
DB privatization plan is revivedGerman Chancellor Angela Merkel has endorsed an oft-postponed plan to privatize Germany's rail operator Deutsche Bahn AG, Reuters reports. The government would divest a 25% stake of DB by the end of 2008, at an estimated worth of 3 billion euros ($4.1 billion). But the plan still requires approval by both houses of the German legislature, where its prospects are uncertain.
BNSF earnings slip despite revenue gainBurlington Northern Santa Fe Corp. said second-quarter earnings fell 8% to $433 million, compared with $471 million in the same quarter one year ago. Revenue was up 4 percent from the year-ago quarter from $3.6 billion to $3.7 billion. The railroad's second-quarter operating ratio also improved, up to 77.5% versus 75.9% one year ago. BNSF cited rising fuel expenses for the earnings decline, compounded by flat coal volumes, attributable to mine production and weather-related issues. BNSF foresees a rebound in coal activity, and increased agricultural growth in fertilizer and ethanol products, in the second half of 2007.
Anti-Amtrak amendments loomAt least three amendments will be offered today to cut Amtrak funding, currently pegged at $1.4 billion for fiscal year 2008 by House bill H.R. 3074, according to the National Association of Railroad Passengers. An amendment by Rep. Michelle Bauchman (R-Minn.) would reduce Amtrak's operating grant by $106 million and transfer funds to homeless housing programs. Two amendments by Rep. Jeff Flake (R-Ariz.) would cut Amtrak's operating grant by $475 million, and reduce the corporation's capital grant by $425 million. A fourth amendment, offered by Rep. Pete Sessions (R-Texas) to eliminate funding for Amtrak's Sunset Limited, could also be presented for a House vote.
CN increases quarterly revenue, lowers expectationsCanadian National Railway Co. reported income of C$516 million ($493 million) for the second quarter, on revenue of C$2.03 billion ($1.94 billion), down from C$729 million in income over the same period last year. Results included a deferred income tax recovery of C$30 million, resulting from a lowered federal corporate tax rate in Canada. CN lowered its full-year earnings guidance for 2007, citing "the difficult start in the first half of 2007, the significant appreciation in the Canadian/U.S. dollar exchange rate, and expectations of continued revenue weakness in certain segments," notably forest products. Weather woes, including the June flooding of CN's line to Prince Rupert, also hindered the company's fiscal picture. CN also announced a stock repurchase program, beginning July 26 and running up to one year, with a potential goal of acquiring approximately 340,800 common shares.
GE finance unit buys into Indian freight-car builderFreight cars are in urgent demand in India, with a current waiting time of approximately 18 months for a new car. GE Equipment Services of Stamford, Conn., has positioned itself to help fill this demand by acquiring a 15% equity interest in a leading Indian car manufacturing company, Titagarh Wagons Ltd. "This is Equipment Services' first equity investment in Indian transport," said an announcement issued simultaneously today in Stamford and New Delhi. "As a result Equipment Services will have preferred access to Titagarh [cars], which it will lease to Indian Railways and private shippers in India. Equipment Services will also become the preferred provider of vendor financing for Titagarh." The announcement said GE and Titagarh will consider incorporating GE’s forthcoming VeriWise RAIL asset management technology in the manufacture of future equipment to "enable railways and shippers to locate specific cars and monitor their condition and the condition of their freight, thereby helping to enhance the visibility security, and productivity of the rail system."
Tentative agreement reached for 1,300 Amtrak engineersThe Brotherhood of Locomotive Engineers and Trainmen announced that it has reached a tentative agreement with Amtrak covering approximately 1,300 engineers who operate the passenger railroad’s trains. PProvisions of the agreement are being withheld until they have been sent to affected BLET members for review and ratification. Like more than 13,000 other Amtrak employees, the engineers have been working without an updated contract for several years. Retroactive pay increases have been a main point of contention in negotiations that are complicated by Amtrak’s uncertain funding.
Central Midland Railway acquiredProgressive Rail Inc. announced today it has acquired the Central Midland Railway, effective 12:01 a.m. CMR operates more than 50 miles between Rock Island Jct. in metropolitan St. Louis to Union, Mo., and connects to all six Class I carriers serving St. Louis via the Terminal Railroad Association. Lakeview, Minn.-based Progressive Rail also operates several short lines lines in Minnesota and one in Wisconsin, handling more than 14,000 carloads annually.
VIA, union reach tentative accordCanadian Auto Workers officials will meet in Montreal today to review a tentative accord reached with VIA Rail Canada, before presenting it for a vote by the union members. The agreement, reached Sunday, postpones and possibly averts a strike, scheduled to commence at 12:01 a.m Eastern Time Sunday, that would have shut down the intercity passenger railroad. Union officials said the agreement avoids wage and benefit reductions that management had sought, and offers a package comparable to past agreements. But no specifics were offered by either side pending ratification, which is expected in about two weeks.
Ton-mile volume down 4.2% in latest weekTon-mile volume on U.S. railroads was down 4.1% in the week ended July 14 from the same week a year ago. Carload traffic dropped 5.5% and intermodal volume was off 3.0%.
Five of the 19 carload commodity groups showed increases in the latest week: led by motor vehicles, 7.5%; food products, 5.8%; and petroleum products, 9.34%. The loss column included lumber and wood products, off 22.4% as the housing slump continued; farm products other than grain, down 22.8%; and stone, clay, and glass products, down 17.7%.
For the first 28 weeks of 2007, carload traffic was down 4.1%; inermodal was down 1.3%; and total ton-mile volume was off 2.9%.
In Canada, the week ended July 14 saw carload traffic decline 0.8% while intermodal volume increased 4.3%. Year-to-date, carload traffic was off 0.7% and intermodal was up 1.8%.
On the Kansas City Southern de Mexico, carload freight was up 18.2% in the week ended July 14 and intermodal increased 27.8%. For the year, KCSM reported that carload traffic was down 4.2% and intermodal up 11.1%.
Hub Group posts record income as intermodal revenue growsThe Hub Group's intermodal revenue increased 5.2% to $300.9 million in the second quarter, helping the company post record net income of $13.8 million from continuing operations, 13% higher than in the second quarter of 2006. Gross margin from continuing operations increased 4.1% to $58.1 million. Intermodal growth helped offset declines in truck brokerage and logistics revenues.
Siemens begins Russian Railways car productionRussian Railways (RZD) officials today formally certified bodyshell production of the first Russian high speed train, Velaro RUS, according to Siemens Transportation Systems. RZD plans to inaugurate the nation’s first high speed rail service, linking Moscow and St. Petersburg at speeds of 150 mph, by the end of 2009. The 600 million euro ($829 million) contract calls for Siemens to build eight high speed trainsets at its Krefeld-Uerdingen, Germany, plant, with all equipment delivered by 2010. Siemens also will oversee service and maintenance of the equipment for 30 years.
Bombardier to refurbish MARC push-pull carsBombardier Transportation announced today that it has won a $14 million contract with the Maryland Transit Administration (MTA) for the refurbishment and overhaul of 34 MARC IIB push-pull commuter cars. Work will cover the car body, trucks, HVAC, brakes, door controls, and other systems and components. The project will also include addition of new bike racks. Work will be carried out at Bombardier's overhaul facilities in Kanona, N.Y. The cars will be returned to service by 2010.
Infrastructure set for final Paris-London high-speed link After years of delay and frustration, the final track and overhead catenary system sections of the Paris-London high-speed line, betwen Ebbsfleet (Kent) and St Pancras Station, London, are ready for testing. Alstom Transport has announced it is handing the line over to customer Union Railways North (URN). The segment is scheduled to enter high-speed service on November 14, cutting trip times between Paris and London by 20 minutes to 2 hours, 15 minutes; at that time, St Pancras will become the terminal point for all Eurostar trains. Eurostar services have been sharing the section between Ebbsfleet and London’s Waterloo station with suburban trains, but the new section of the line will be reserved exclusively for high-speed operations, including Eurostar and, as of 2009, high-speed regional trains. The work involved the installation of 40 kilometers of double track, half of which is in tunnels, the overhead lines, management of railway access on behalf of other contractors, and system integration tests. It also included the management of the overall commissioning of the integrated systems.
STB solicits utilities service complaintsThe Surface Transportation Board's Wednesday hearing in Kansas City gathered comments from utility and railroad executives on the current state of the delivery system, particularly from the coal-rich Powder River Basin in Wyoming and Montana. Utility representatives assert that shipping rates have nearly doubled in the past two years, while rail delivery of the coal needed to generate electricity at power plants has become increasingly erratic and unreliable, requiring utilities to often buy power on the spot market at higher costs. For their part, railroad representatives highlighted the capital investments that were being made to handle the greater volumes the industry has experienced in the past several years. The prospect of a growing ethanol market and the ability of railroads to handle that commodity in the future were also discussed.
Bombardier wins Delhi metro contractBombardier Transportation announced today that it has won an order for 340 Movia metro cars from the Delhi Metro Rail Corp. Ltd. (DMRC), valued at roughly $590 million. Deliveries of the trains are scheduled to begin in the last quarter of 2008, with completion in 2010, in time to serve the Commonwealth Games that will be held in New Delhi in October 2010. The vehicles are configured in four-car sets with capacity for 1,480 passengers. Carbodies, bogies, and propulsion system for the first units will be manufactured by Bombardier sites in Germany and Sweden. Thereafter, the main production will be undertaken by Bombardier in India. The propulsion system for 60 four-car units will be produced by Bombardier's site in Baroda; 77 four-car units will be manufactured by other Bombardier sites in India.
You can say it again: Butte, Anaconda & PacificThe Rasrus Railway announced today that it's reverting to its ancestral name, the Butte, Anaconda & Pacific. Parent company Patriot Rail Corp. commented, "The name has historical significance, as the Rarus Railway traces its Montana heritage to the historic BA&P Railroad, which was built in the 1890s." Today's announcement said the name change is effective immediately. The new BA&P operates over a 163-mile route, including 26 miles of main line running between Anaconda and Butte, Mont. The railroad was originally built to serve the Anaconda Copper Mining Co., transporting ore from the mines in Butte to a smelting operation in Anaconda. In 1913, the BA&P became the first U.S. freight railroad to electrify. The electrification was abandoned in 1967. In 1985, the railroad was sold to local investors and eventually reconstituted as the Rarus Railway.
Alstom lands Rotterdam contractAlstom announced today that it has been selected by RET, the public transport operator of Rotterdam in the Netherlands, to supply 53 Citadis tramway trainsets. The $138 million-plus contract is expected to be signed in October, with vehicle delivery slated for mid-2009. Alstom will produce the trainsets at its La Rochelle, France, facility. One of Citadis's first users, Rotterdam ordered 60 trainsets for its Tram-plus network in 2000, with the last of those entering service in December 2004. The new Citadis fleet will run on the inner-city network and replace Duewag ZGT trams, which have been operating for 25 years.
Union Pacific Distribution Services launches new business unitCarload shippers using Union Pacific Distribution Services now have a one-stop shop for transloading and logistics services. UPDS has formed a new business unit, the Carload Solutions Group, to integrate two former departments: OnePlus Transload Services, which has provided material-handling expertise for more than 20 years, and Rail Shipment Management Business, which has provided tactical supply chain management for more than 200,000 carloads annually.
Commenting on the move, UPDS President Beth Whited said: "Combining multiple product offerings into a single business unit affords us the opportunity to add a higher level of customized logistics services for our customers."
The Carload Solutions Group will support "critical aspects of customers’ supply chain, including transload management, forward inventory management and distribution, rail shipment management, in-transit visibility (including inventory), logistics network design, forecast management, outsourced carload transportation management, transportation systems integration, enterprise resource planning, and private rail asset management.
Red River Valley & Western turns 20Today marks the 20th anniversary of the 514-mile Red River Valley & Western, Railway Age's 1997 and 2005 Regional Railroad of the Year. Since 1987, RRV&W has handled more than 500,000 carloads of grain, corn sweetener, sugar, machinery, and other products over track acquired from the former Burlington Northern in southeastern and central North Dakota. The regional has increased freight volumes 133%, with last year's total coming in at 53,600 carloads, and boosted employee numbers from 46 to nearly 100.
"The RRV&W is proud to celebrate this milestone," RRV&W President Andy Thompson said during an announcement late yesterday. "We are particularly grateful to our employees, our customers, and the many partners who have been instrumental in our growth. We also want to thank our suppliers, BNSF Railway, public officials, and surrounding communities for their support over the past 20 years."
According to the railroad, many new businesses have located or expanded along its line. Among them: six high-volume grain elevators capable of handling 110-car shuttle trains. RRV&W is said to have spent $20 million-plus on such capital improvements as track rehabilitation, in addition to an annual $4.5 million on track maintenance. It also has replaced its locomotive fleet with Generation II diesels equipped with Caterpillar engines, and acquired 150 freight cars, primarily used to haul grain.
In addition to being recognized for its success by Railway Age, the regional was selected by the American Short Line & Regional Railroad Association as a winner of the 2005 Marketing Competition and by BNSF Railway as a recipient of the Short Line Achievement Award.
To celebrate its anniversary, RRV&W is operating a series of special passenger trains July 19-21.
UP earnings, revenue up in second quarterUnion Pacific Corp.'s second-quarter earnings rose on strong commodity revenue, the company reported. Earnings of $446 million were up more than 14% over the $390 million in the year-ago period. Second-quarter revenue of $4.05 billion was up 3% from $3.92 billion in the second quarter of 2006. Commodity revenue rose 3% to set a quarterly record of $3.9 billion. UP stock has gained about 14% during the quarter that ended June 30 and has risen 33% so far this year, in line with the industry overall.
Metronet companies seek PPP administrationBombardier Transportation noted today that two London Underground public/private partnership concession companies in which it has a 20% interest--Metronet BCV Ltd. And Metronet SSL Ltd.--have asked to come under PPP administration (a move similar to a request for bankruptcy protection). This followed an arbitrator's decision sharply reducing the amount of an interim payment requested by Metronet, whose companies hold concessions for the maintenance and upgrade of 75% of the London Underground Tubes. Bombardier said this development will have no impact on Bombardier's consolidated financial statements as it has already announced the write-down of the total carrying value of its Metronet investment to be recorded in the second quarter of FY 2008. Bombardier also pointed out that its has turnkey contracts worth $6.7 billion for new and refurbished trains, and fleet maintenance for the Underground, and "these contracts are progressing well and Bombardier will continue to work upon them as per the requirements contained in its contracts."
Five more unions ratify rail agreements The National Carriers' Conference Committee announced that tentative or final agreements have now been reached with unions representing more than 96,000 or two-thirds of the 145,000 employees of Class I railroads covered in national bargaining. Still looking for a contract is the United Transportation Union, which has sued the railroads in federal court demanding that the carriers enter into negotiations on entry-level pay and training.
The latest unions to agree on new contracts are the Transportation Communications International Union, the Brotherhood of Railway Carmen, the Transportation Workers Union, the International Association of Machinists and Aerospace workers, and the International Brotherhood of Electrical Workers.
Layoffs coming at FreightCar America plantA significant number of FreightCar America’s 180-member unionized work force at its Johnstown, Pa., plant will most likely be furloughed next month due to a falloff in business, according to a report published in the Tribune-Democrat, a local newspaper.
The report cited an anonymous FCA source who said that workers belonging to United Steel Workers Franklin Local 2635 were issued warning notices in May regarding the furloughs. The source said that, due to “market conditions,” all new contracts received by FCA are being handled by the company’s “lower-cost facilities” in Danville. Ill., and Roanoke, Va. All three plants are unionized, but the Johnstown plant’s union contracts date back to the Bethlehem Steel days and, compared to the relatively new Danville and Roanoke operations, are saddled with higher costs, some of which stem from work rules that have been in place for many years.
FreightCar America had no official comment for Railway Age.
STB seeks nominations for energy advisory panelFollowing up on a proposal first floated in March, the Surface Transportation Board has decided to establish a Rail Transportation Energy Advisory Committee. The committee will consist of "a balanced cross-section of energy and rail industry stakeholders to provide independent, candid policy advice and to foster open, effective communication among the affected interests on issues such as rail performance, capacity restraints, infrastructure planning and development, and effective coordination among suppliers, carriers, and users of energy resources."
In a decision announced yesterday, STB invited nominations for membership on the advisory panel, due by Aug. 9.
STB said the committee "will consist of not less than: five representatives from the Class I railroads, three representatives from Class II and III railroads, three representatives from coal producers, five representatives from electric utilities, four representatives from biofuel refiners, processors, or distributors, and two representatives from private-car owners, car lessors, or car manufacturers."
National Steel Car plans Alabama manufacturing siteNational Industries Inc., parent of National Steel Car Ltd., has announced plans for a new manufacturing plant in The Shoals region of northwest Alabama. Construction of the manufacturing unit, National Alabama Corp., is scheduled to begin during the next few months, with startup expected in early 2009. The new facility, along with the company’s existing operations in Hamilton, Ontario, will bolster National Industries’ product offerings to the North American market, the company said. Estimated to cost roughly $350 million, the new facility will provide annual production capacity of 8,000-to-10,000 units, and employ up to 1,800.
Private equity consortium eyes CPCanadian Pacific Railway Ltd. could become the latest Canadian company to be acquired by private equity concerns. According to published reports, Toronto-based Brookfield Asset Management Inc. is seeking to acquire CP, in partnership with Goldman, Sachs & Co. and the Caisse de dépôt et placement du Québec. The bid follows a failed earlier offer to CP made by the three in April. At that time, Calgary-based CP authorized a buyback of up to 10 per cent of its stock, seemingly in an effort to block any takeover attempt. In a statement, CP said it "is not at this time in negotiations with any party with respect to a business combination." Analysts suggest that if the consortium does make a bid, CP’s board of directors would initiate an auction by canvassing for other potential buyers, including Union Pacific Corp. Analysts also note CP's acquisition could cost nearly $15 billion.
Sacramento LRT system to store electricitySacramento's Regional Transit District (RTD) will receive a $400,000 grant to install a stationary energy storage system on city’s light rail system. The California Energy Commission and the Sacramento Municipal Utility District are providing funding for Sitras SES, developed by Siemens Transportation Systems, Inc. Sitras SES uses ultra-capacitors to store the potential energy released during regenerative braking and then feeds this energy into accelerating vehicles, thus resulting in peak power demand reduction, energy savings, and a boost to the line voltage. Siemens says it’s the first such application in the United States, though the storage technology is already in use in Europe and in China. Installation will be along an 8-mile stretch of the original Folsom line that has experienced low voltage during peak service times. The installation could save the RTD $25,000 per year in avoided energy costs, and also could offset the need for additional electrical substations.
LIRR addresses wheel-slip woesMTA Long Island Rail Road has initiated a three-point plan to combat train wheel "slip-slide" problems during braking caused by fallen leaves on the rails. LIRR is adding special software modifications to its fleet of M-7 electric cars, which adds wheel slip protection to automatic train control-initiated emergency brake applications. The railroad also has launched a pilot program to install "smart" sanders on 50 M-7 units. Other, less high-tech changes include more rigorous clearing and cleaning of railroad right-of-way, and more centralized procedures for train personnel to report slippery track conditions.
CSX quarterly results show underlying strengthCSX Corp. Tuesday reported net income for the three months ended June 30 fell to $324 million, or 71 cents a share, from $390 million, or 83 cents a share, a year ago. However, the year-ago numbers were skewed by one-time gains of 25 cents a share due to tax benefits and insurance payouts linked to losses from Hurricane Katrina. Excluding those items, CSX's per-share operating profit jumped 22% from the 58 cents it earned a year ago. Moreover, the company also reported that operating income from its surface transportation business rose to $603 million last quarter from $519 million a year ago. The results were helped in part by 7% higher freight volumes for agricultural products and double-digit revenue gains from phosphate and fertilizer shipments. Revenue for the quarter rose 4.5% to $2.53 billion from $2.42 billion a year earlier, with a 7% rise in freight rates overcoming a 2% drop in the volume of goods it carried. CSX already has announced it will increase its dividend by 25% to 15 cents per share, payable in September.
Congestion pricing plan stalls in AlbanyNew York City Mayor Michael Bloomberg's plan for congestion pricing to reduce the number of motor vehicles entering the busiest parts of Manhattan failed to win the necessary approval of the legislature in Albany in time to quality for up to $500 million in federal aid. Modeled after a similar plan that has reduced congestion in London, Bloomberg's proposal would have imposed a toll of $8 on automobiles entering Manhattan below 86th Street and a higher toll on trucks.
Union sets VIA Rail strike dateThe Canadian Auto Workers Union announced that its members at VIA Rail have authorized a strike deadline of 12:01 a.m., July 22, but added that it was optimistic that differences can be settled before that time despite "many key issues outstanding." After several weeks of negotiations, the two sides reconvened yesterday with two federal conciliators.
Intermodal drives J.B. Hunt improvementJ.B. Hunt Transport Services today announced a 2% growth in operating revenues, to $825 milliom, and a 25% improvement in operating income for the second quarter of 2006, thanks to a strong performance by its intermodal segment. "Intermodal segment revenue continued its steady expansion with load growth of 14% over the same period in 2006," said the motor carrier and pioneering railroad intermodal partner. "Year over year price per mile comparisons remain positive, up 1.5%, while moderating fuel surcharge revenues grew at a slower pace than overall revenue."
The announcement said that "healthy growth in volume and higher prices" in intermodal helped offset "slower net growth in our DCS (Dedicated Contract Services) segment, and stagnant freight volumes and lower prices in our Truck segment."
Employment remains steady as traffic declinesDespite a 3.1% decline in traffic in this year's first four months, Class I railroad employment during the period held its own and in mid-May was actually up slightly over the prior year. The mid-May employment figure was 167,869, 0.6% higher than at the same time last year. The biggest employment category, transportation (train and engine), remained virtually flat at 70,443. In the category of executives, officials, and staff assistants, employment rose 4.51% to 10,172 for the biggest percentage increase. Maintenance employment rose slightly, with maintenance of way and structures up 0.86% to 35,622 and maintenance of equipment and stores up 1.67% to 30,645. There were decreases in the categories of professional and administrative, down 0.4% to 13,800, land transportation (other than train and engine), down 2.35% to 7,198.
CSXT joins N.Y. and N. J. in first “rail security partnership”CSX Transportation has gone forward with a plan to share security information, resources, and strategies with the states of New York and New Jersey. Earlier this year, CSX Vice President-Public Safety and Environment Skip Elliott told attendees of Railway Age’s 2007 Railway Security Forum & Expo that such a partnership was on the horizon (RA, May, p. 45).
“We’re pleased to be the first railroad and among the first private industries to formalize security partnerships with the states in order to jointly safeguard both the communities we serve, and our ability to move the goods so critical to the economy,” CSXT Vice President and Chief Transportation Officer David Brown said during today’s announcement.
The railroad is giving state officials access to CSXT’s Network Operations Workstation System (NOWS), an online program that tracks the location of CSXT trains and identifies CSXT-hauled railcar contents by state in near realtime. CSXT also will work with law enforcement officials in both states on joint rail security training and preparedness exercises and provide round-the-clock access to CSX rail security professionals.
CSX has been providing NOWS access to American Chemistry Council's CHEMTREC team for about two years.
Bolivia will renationalize its railroadBolivian President Evo Morales announced that the government plans to recover control of the national railroad that it privatized in 1996, then known as Empresa Nacional de Ferrocarriles. The announcement had been expected for several months. Evo, the country's first Indian president, announced after his installation last year that he would seek to take back a number of formerly government-run businesses.
Anticipating that this would include the railroad, partial owner Genesee & Wyoming wrote down its $8.9 million investment by $5.9 million in the spring of 2006 and subsequently announced that it was discontinuing equity accounting for the remaining $3 million investment.
Freight-car backlog slips as orders declineThe Railway Car Institute Committee of the Railway Supply Institute reported today that builders delivered 16,643 new freight cars in this year's second quarter, down from 19,466 in the corresponding period last year. New orders were placed in the first quarter for 11,595 cars, compared with 19,190 in the 2006 quarter. The backlog of new cars on order but undelivered slipped to 73,921 on July 1, compared with 85,692 on July 1, 2006.
First-quarter 2007 orders included 4,236 tank cars, 2,706 open–top hoppers, 2,200 intermodal platforms, 831 non-intermodal flat cars, 632 covered hoppers, and 500 boxcars.
Bombardier writes off $164 million Metronet investmentBombardier announced today that it will write-off an investment of approximately $164 million in the UK's Metronet Rail BVC Limited, which is responsible for renewal of the London Tubes' Bakerloo Central, Victoria, and Waterloo & City lines. Bombardier said its decision followed the release of "the Public-Private Partnership Arbiter's draft directions on an interim infrastructure charge." (Reuters reported that the arbitrator's decision meant that London Underground would pay an extra $246 million rather the $1.1 billion requested by the Metronet consortium of which Bombardier is a member.)
Bombardier said today's development does not affect its turnkey supply contracts with Metronet valued at more than $6.7 billion for new and refurbished trains, signaling, and fleet maintenance.
Bombardier added that it remains committed to deliver "a world class, safe, and reliable Tube London."
Stan Bagley dies at 61Stan Bagley, who retired as Chief Operating Officer of Amtrak in 2005, died yesterday of cancer at age 61. He previously served as President of the Northeast Corridor and on the Board of Directors of the Washington Terminal Company. A private family service is planned.
MTA, NJ Transit offer bus/LRT bistate link Responding to demands for improved transit access from Staten Island residents and political officials, MTA New York City Transit (NYCT) will initiate a new bus service from Staten Island to the Hudson-Bergen Light Rail Transit (HBLRT) in Bayonne, N.J., beginning this fall.
The Metropolitan Transportation Authority said the new limited stop route will allow Staten Island residents to access the growing job market in Bayonne, Jersey City and Hoboken – New Jersey’s “Gold Coast” -- as well as connect to the PATH train to Manhattan. “Reverse peak” service will offer Hudson County residents access to jobs in Staten Island. MTA also expects the service to improve traffic flow over the Bayonne Bridge, linking New Jersey with Staten Island, and on other state and local roads.
MTA and NJ Transit also plan to offer a joint monthly ticket for service on both the MTA NYC Transit bus route and on HBLRT. The Port Authority of New York & New Jersey will provide a one-time contribution of $2 million to help buy buses that will be used on the service. No date was given for the implementation of such ticketing.
MTA anticipates 1,200 daily riders on the new route, paying a local fare ($2 base) and offering free MetroCard transfer to connecting Staten Island local bus routes. Standard MTA buses that normally provide local service will be utilized for the bus portion of the bus/rail intermodal link.
The new route, the S89 Limited, will run 12.5 miles from Hylan Boulevard-Richmond Avenue in Eltingville to the 34th Street HBLRT Station in Bayonne, traveling via Richmond Avenue and the Bayonne Bridge. The service will operate on weekdays during the morning and evening peak periods, from 5:30 a.m. to 8:30 a.m. and 4:00 p.m. to 7:30 p.m. Buses will depart every 15 minutes in the peak direction (toward Bayonne in the morning) and every 30 minutes in the reverse peak direction (to Staten Island in the morning).
MTA had come under fire for its lack of interest in such bus/rail service, particularly when the agency cited regulations prohibiting it from employing buses to serve New Jersey points. Critics in both New York and New Jersey, however, cited ongoing MTA rail services terminating in Hoboken, N.J., as an example of bistate transit coordination to serve as a template for other improvements.
Traffic decline continuesU.S. railroads handled an estimated 29.6 billion ton-miles of traffic in the week ended July 7, a decline of 2.3% from the corresponding week last year. Carload volume was down 3.6% to 282,888 cars, and intermodal volume was down 0.7% to 192,516 trailers or containers. Year-to-date, carload traffic was down 4.12%, intermodal was off 1.3%, and ton-mile volume was down 2.8%.
Canada's railroads reported that carload freight was down 1.0% in the week ended July 7, to 72,130 cars, and intermodal traffic totaled 43,828 units, up 3.1% from last year. Cumulative figures for the first 27 weeks of the year showed an 0.7% drop in carloadings and a 1.7% increase in intermodal volume.
Kansas City Southern de Mexico carried 10,433 carloads of traffic in the week ended July 7, down 8.3% from last year, and 4,007 intermodal units, up 17.7%. KCSM carload volume for the year so far was down 4.8% from 2006, and intermodal traffic was up 10.6%.
Track construction loan approved for Ohio ethanol plantThe Ohio Rail Development Commission has approved a $1 million loan to Greater Ohio Ethanol for construction of a 1.2-mile rail spur to service a new ethanol production plant at Lima, Ohio. The $145 million plant, which is currently under construction, would produce an estimated 54 million gallons of ethanol annually and at least 5,000 inbound and outbound carloads. ORDC says half of the ethanol produced, roughly 1,000 carloads, would be shipped by rail, as well as an estimated 1,150 carloads of Dried Distillers Grain (DDG) that can be reused as cattle feed. Additionally, a small amount of the carbon dioxide produced by the plant can also be shipped by rail for reuse by other industries. The Indiana & Ohio Railroad, which connects with both Norfolk Southern and CSX at Lima, will serve the new plant.
National Railway Equipment delivers six locomotives to Tennessee SouthernPatriot Rail subsidiary Tennessee Southern has taken delivery of six refurbished GP-10 locomotives from National Railway Equipment Co. Newly painted in TS's red, white, and blue color scheme, the locomotives have been upgraded with the N-Force wheel slip system that gives 1,700-h.p. locomotives the traction effort of 2,300-h.p. units. The GP-10s will replace older locomotives in TS's fleet.
Meanwhile, the 118-mile short line also announced that it has secured new business that is slated to bring in about 900-1,200 carloads annually. It will come from three new customers: Hassell & Hughes Lumber Co. (Collinwood, Tenn.); Synagro Technologies, Inc. (Houston, Texas); and Smelter Services Corp. (Mt. Pleasant, Tenn.). To help seal the deals, TS completed extensive track work for Synagro and worked to develop a new 1,200-foot spur track layout for Smelter. TS now has 32 customers and an annual carload traffic total of approximately 7,000.
RailAmerica co-founder and former chief executive Gary O. Marino formed small-road holding company Patriot Rail in 2006. TS was its first acquisition. Patriot purchased Montana-based Rarus Railway earlier this year.
Florida East Coast named UPS "Rail Carrier of the Year"After setting a new failure-free service record for UPS in May, Florida East Coast Railway has received a 2006 "Rail Carrier of the Year" award from that international shipping firm. The award recognizes FECR's "continuing commitment to UPS for daily on-time delivery."
"We rely on building strong relationships with partners like FECR who provide great customer-centric service," said UPS Vice President-Transportation Randy Welch. "UPS strives to provide leading edge service to our customers on a daily basis and FECR helps to facilitate that goal."
Over a 700-consecutive-day period ended in May, FECR handled more than 62,000 intermodal loads, allowing UPS to deliver 95 million-plus packages on time. This was a new record for any transportation company serving UPS, according to FECR, Railway Age's 2007 Regional Railroad of the Year. The Class II regional told RA in April that it was striving to surpass its previous 698-day record (set in 2005) in May 2007.
"Being chosen by UPS as a Rail Carrier of the Year is a powerful recognition of our ability to meet [its] service performance levels and our ability to adapt in critical situations to deliver high quality service, under adverse conditions," commented Assistant Vice President-Intermodal Marketing FECR David A. MacInnes. "UPS takes advantage of our scheduled intermodal service with multiple daily departures. By striving to continually improve our network performance for UPS, we have created an intermodal service that is competitive to over-the-road transit time and more reliable than trucking."
Florida East Coast Industries, parent company of FECR, is expected to be acquired by Fortress Investment Group, LLC, in the third quarter.
Hazmat shippers test enhanced GPS monitoringBourque Data systems, Inc., (BDS) and Satamatics, Inc., announced that they have integrated Satamatics' Inmarsat D+ satellite communications network with BDS's RAILTRAC® for railcar GPS location. “This robust XML data integration will provide our customers with real-time railcar location and asset monitoring for enhanced security and control," said BDS President Steve Borque. He said several pilot programs are under way with large shippers of hazardous chemicals.
Satamatics President and COO Brian Hester commented: "Being able to locate a fleet or a single tank car carrying hazardous materials in minutes is an incredible tool in times of crisis and is completely within the technical capabilities of both the BDS software and the Satamatics hardware and satellite airline services. With the equipment smaller than a lunch box, battery life of over five years, and real-time polling capabilities on a global basis, this technology has really matured to a point where it's affordable and completely warranted on all hazmat shipments."
High-speed train order strengthens Alstom quarterAlstom reported today that between April 1 and June 30, it booked orders valued at around $10.5 billion, including $2.9 billion for 80 "very high speed" trains in France. Alstom's total level of business was up 62% during the quarter from the same period last year, and its Transport business was up 148%. Alstom ended the quarter with a backlog valued at nearly $50 billion.
Alstom Chairman and CEO Patrick Kron commented: "The level of orders booked during the first quarter of 2007/2008 confirms our good positioning across all our sectors. This very strong quarter, highlighted by a book-to-bill ratio close to two, included large contracts such as the very high speed trains in Transport and turnkey gas projects in Power Systems but also a very healthy level of small and medium-sized contracts in all our businesses."
New MotivePower units arrive at Pacific Harbor LineIn a ceremony attended by the mayors of Los Angeles and Long Beach and other city and state officials, Pacific Harbor Line (PHL) formally accepted the first four of 16 remanufactured switching locomotives it has ordered from Wabtec subsidiary MotivePower, Inc. Each of the two cities is paying $5 million toward the $23 million project, with PHL paying $10 million and the remainder coming from a California clean air program.
MotivePower is supplying 14 MP20C-3 six-axle and two MP20B-3 four-axle units. All are equipped with 2,000-hp MUT Detroit Diesel engines, which are said to reduce particulate emissions by 70% and smog-forming nitrogen oxides by 40%, while burning 30% less fuel.
A unit of Anacostia & Pacific, PHL began operations in 1998, providing switching service to the Ports of Long Beach and Los Angeles and dispatching all BNSF and Union Pacific trains within the ports. PHL maintains 60 miles of track owned by the ports and serves seven on-dock intermodal terminals.
WMATA plans $25 million fare card upgradeWashington Metro plans to invest nearly $25 million in upgrading fare machines in 89 stations over next four years. A Metro announcement said the upgrade will permit fare card machines to dispense both regular and cheaper paper-based SmarTrip cards and also make it easier for riders to pay with credit cards. The plan is subject to final approval on July 26.
"The technology is still being tested for the paper-based SmarTrip cards," said Dave Couch, director-infrastructure renewal projects. "They would cost less than the current $5 charge but have a shorter life. We believe some riders, such as tourists, may prefer this type of card."
Grade crossing and trespasser fatalities declineU.S. railroads reported 251 fatalities in this year's first four months, down 6.3% from the same period in 2006. There was a decline this year in both highway-rail grade crossing fatalities, down 10.3% to 105 for the period, and trespasser fatalities, down 6.8% to 137. There were four employee fatalities in January-April of this year, compared with three in the same period in 2006.
A preliminary report by the Federal Railroad Administration showed a total of 3,910 accidents and incidents in the first four months of this year, down 8.3% from the prior-year period. Train accidents were down 14.8% to 793, derailments declined 10.5% to 605, and collisions increased 5.6% to 57. Yard accidents were down 21.8% 408.
New Michigan-Indiana freight service to come onlineEarly next year, Watco Companies plans to launch the 384-route-mile Michigan Central Railway (MCR) as part of a joint venture with Norfolk Southern, which will contribute rail lines and land. The new small road will operate between Ypsilanti, Mich., and Kalamazoo, Mich.; Jackson, Mich., and Lansing, Mich.; and Grand Rapids, Mich., and Elkhart, Ind. MCR also will acquire NS's trackage rights on the Amtrak-owned line beween Kalamazoo and the Michigan/Indiana state border. The railroad companies will share free-cash flow once MCR starts running, Watco Executive Vice President-Chief Commercial Officer Ed McKechnie told Railway Age. The deal is subject to Surface Transportation Board approval. Watco and NS are expected to file the appropriate documents later this month.
"In the first year alone, we plan to invest more than $6 million to improve track and equipment to capitalize on the rail-served economic development opportunities we envision for the region," said MCR Interim President David C. Eyermann. That figure will rise to about $30 million in capital investments over the first three years, according to McKechnie.
MCR will be headquartered in Kalamzoo and employ approximately 118 people.
Pennsylvania plans landmark transportation trust fundUnder a budget agreement that ended a brief shutdown of non-essential state services in Pennsylvania, the Philadelphia area's SEPTA system will receive an additional $150 million in operating funds for the new fiscal year, enough to avoid a threatened additional fare hike and severe service cuts. SEPTA will maintain a fare increase averaging 11% that went into effect Monday.
The agreement calls for a transportation trust fund that in future years will give state mass transit agencies funding totaling more than $400 million annually, with around 60% going to SEPTA. More than $500 million will go to highways and bridges.
In the current fiscal year, the new program would provide $300 million for transit and $450 million for highways and bridges.
Trust fund money would come from Pennsylvania Turnpike and I-80 tolls and a 4.4% share of state sales taxes.
Gov. Ed Rendell said the transportation portion of the budget agreement is "by far the most significant amount of money devoted to transportation needs in the history of the Commonwealth."
UP and Nebraska college offer new rail trainingUnion Pacific and Mid-Plains Community College in McCook, Neb., are ready to announce a new agreement that will create two 18-month programs offering Associate of Applied Science Degrees in Electrical Technology or Diesel Technology with an emphasis on railroad operations. The program will apply railroad-specific training and provide employment interviews with the railroad to graduates.
The program will be unveiled at a news conference on Friday at North Platte Community College's North Platte, Neb., campus. Mid-Plains College will immediately begin accepting students for the upcoming fall term beginning Aug. 20.
NJ Transit advances light rail extensionNJ Transit's plans for a one-mile extension of Hudson-Bergen Light Rail service to a new station at 8th Street in Bayonne moved ahead today when the agency's board of directors authorized acquisition of property for the new construction. Board Chairman and State Transportation Commissioner Kris Kolluri said the extension will provide new neighborhoods with connections to NJ Transit rail services, Trans-Hudson ferries, PATH trains, and park-and-ride facilities.
Design work is already under way for the project, which will extend the light rail system from its current southern terminus at 22nd Street along a Conrail line adjoining Avenue E. Construction is scheduled to start in 2008 with completion in late 2009.
Amtrak FY 2008 funding nearing final numberFiscal Year 2008 legislation covering transportation and housing programs marked up by the Senate Appropriations Transportation, Housing and Urban Development Subcommittee yesterday provides $1.4 billion for Amtrak—$100 million more than what Amtrak was appropriated in FY 2007, $600 million more than the amount requested by the Bush Administration, and identical to the amount marked up by a House appropriations subcommittee. In addition, $100 million is appropriated for intercity rail corridor development, an amount matching that requested by the Administration.
The Senate bill is scheduled for full Senate Appropriations Committee markup tomorrow. It “soundly rejects” several Administration proposals to cut funding for transportation and housing programs and “tracks closely” with the House version, according to the Congressional Quarterly. It “sets up a showdown with the White House, which has threatened to veto spending bills that exceed President Bush’s request.”
The full House Appropriations Committee is scheduled to mark up its transportation and housing bill today; some Republicans were expected to try to cut it to fit more closely with Administration requests for housing programs and Amtrak. The House bill contains $50 million for corridor development, half the amount proposed by the Senate and the Administration.
Senate Subcommittee Chairwoman Patty Murray, D-Wash., a staunch Amtrak supporter, characterized the rail corridor development grant program as “the one area of the President’s proposal for rail transportation” that lawmakers could agree with.
NJ Transit sets ridership recordNew Jersey Transit upped ridership 4.1% to 250.9 million annual trips during its 2007 fiscal year (July 1, 2006-June 30, 2007)--a new agency record. All bus, commuter rail, and light rail services showed gains. Total ridership is now approaching 900,000 trips per weekday, according to NJT, the third largest transit system in the country with 162 rail stations, 60 light rail stations, and more than 18,000 bus stops linking major points in New Jersey, New York, and Philadelphia.
"Given our strong regional economy and job market and sustained higher fuel prices, more New Jersey residents than ever are relying on public transportation," Governor Jon S. Corzine said, during yesterday's announcement. "This continuing trend of record-high ridership on our state's transit network underscores the critical need for additional capacity expansions such as the ARC [Access to the Region's Core] project and enhanced intrastate bus service."
Among top gains: Light rail ridership increased 22.4% to 18.8 million passenger trips vs. the record 15.4 million in 2006. Growth occurred along Hudson-Bergen Light Rail--which opened two new stations in February 2006--and the new Newark Light Rail extension to Broad Street Station, which launched in July 2006.
According to NJT, it has recorded ridership gains in 19 of the 28 years it has operated the State's transportation system. Ridership levels have increased 41.7% since the agency was established in 1980.
Final ridership data will be released with NJT's annual report in the fall.
Greenbrier ups earningsThe Greenbrier Companies today posted net earnings of $13.0 million, or 81 cents per share, for its fiscal third quarter ended May 31--a 21.5% jump over the year-earlier period. Current earnings include a $3.1 million charge (with no related tax benefit) associated with severance and other closure costs of the company's unprofitable Canadian railcar manufacturing plant, TrentonWorks. The facility, now in the process of being permanently shut down at a total cost of $10 million, completed its most recent order for about 300 cars in early May.
Greenbrier said total revenues for the quarter are up 45% at $387 million. The boost is due, in part, to a shift in product mix to more conventional railcars and from the acquisitions of Rail Car America and Meridian Rail Services and start-up of new locations. Thompson Financial-polled analysts anticipated a profit of 39 cents a share on revenue of $299.5 million.
Greenbrier delivered 3,000 new railcar units during the third quarter. With fiscal-year-to-date deliveries at 6,200 units, the company anticipates total FY 2007 deliveries to be 8,500 to 8,800 units--higher than its previous estimates of 8,000 to 8,500. "This upward revision reflects higher production rates resulting from orders received during the third quarter," Senior Vice President and Treasurer Mark Rittenbaum said during today's announcement. (Those orders include trimming down 2,500 existing 48-foot double-stack intermodal platforms to 40-foot versions for unnamed customers; and 1,700 new double-stack intermodal platforms for an undisclosed customer.)
The company’s railcar manufacturing backlog of 14,100 units worth $970 million is down slightly from last quarter's 14,300 units valued at $990 million. Scheduled for delivery through 2010, the backlog "has been priced to cover potential material price increases or decreases and surcharges," according to the company.
"Our third-quarter results reflect our strategic product and business diversification efforts, the decision to close our Canadian manufacturing facility, and focus on improving manufacturing productivity," summed up Greenbrier President and CEO William A. Furman. "While year-to-date rail loadings in North America have been muted due to a slowdown in the economy, we continue to believe that the secular forces that favor the rail industry will persist and that the fundamentals of markets we serve will translate into robust business activity for the rail supply sector over the long term."
BNSF repairs and reopens busy coal routeEarly today, BNSF Railway completed repairs to a busy coal route in Kansas that had been out of service since June 30 and reopened it to traffic. In a service advisory July 6, BNSF said that "high water, mud slides, and washouts due to torrential rains" had closed more than 20 miles of its main line south of Kansas City toward Springfield, Mo. Trains continued to move during the outage but via more circuitous routes that slowed the flow of loaded and empty coal trains to and from the Southeast.
Separately, BNSF announced its average loadings in the Powder River Basin, including Wyoming and Montana mines, averaged 50.5 trains a day in June, compared with 50.4 trains a day in the same period last year. "Continuing weather issues and planned and unplanned outages at some PRB mines resulted in the loss of an average of 5.0 train loading opportunities per day during June 2007," said BNSF. Year-to-date, BNSF has loaded an average of 49.2 PRB coal trains a day, up 1% from 2006. Systemwide, BNSF handled 141.5 million tons of coal through June, 2% more than in the same period last year.
CN ordered to supply cars to small grain shippersThe Canadian Transportation Agency has ordered CN to create a program allowing Great Northern Grain Terminals Ltd. (GNCG) to place advance orders for blocks of 50 railcars. The agency said its action responded to a complaint alleging that "CN discriminated against GNCG in the distribution of railcars, rendering GNCG and other small grain handling companies uncompetitive in the marketing of grain." The complaint suggested that CN's practice favored 100-car orders.
In a decision handed down July 6, the agency concluded that "in establishing car supply practices that have restrictive terms and conditions like minimum order durations and exclude significant segments of the shipper community, CN unilaterally becomes the arbiter of which of its captive shippers are eligible for competitive advances." The decision also found that "through its virtually exclusive control of rail service in portions of the western Canadian grain market, CN creates an imbalance and, inevitably, as seen in this case, a failure in the marketplace."
The agency said that although its jurisdiction in this case was limited to GNCG's service problems, "the systemic nature of CN's conduct has undoubtedly affected other grain shippers," creating a need for "a new and open dialogue between CN and its shippers, so that they are able to reasonably deal with car supply issues independent of regulatory intervention to the greatest possible extent."
RDC pulling up stakes in GuatemalaFrustrated by the efforts of the Guatemalan government’s effort to undermine and take over a successful privatized railroad, Pittsburgh, Pa.-based Railroad Development Corp. is pulling up stakes and walking away from Ferrovias Guatemala, following 12 years of investment and hard work.
On Aug. 25, 2006, the Government of Guatemala promulgated a “Declaration of Lesividad” (Declaration of Damage) on RDC’s usufruct contract for Ferrovias Guatemala’s rolling stock and equipment, an action “reflective of the government’s determination to put us out of business,” said RDC Chairman Henry Posner III. “As a result of this Declaration, our shipments have declined and our operating difficulties have increased. Among the problems created have been an inability to obtain credit; an increase in squatters of all types, ranging from families to private companies; judicial interference; and police indifference and neglect. Most significantly, and fundamental to our profitability, our ability to attract additional investment and revenue from various uses of our right of way has disappeared.”
“Through the tireless efforts of our employees and the determined support RDC, we have continued to operate in order to see whether there was anything that we could possibly do to overcome the effects of the Declaration,” said Posner. “Unfortunately, instead of improving, matters have gotten worse. It is therefore impossible for FVG to continue operations under the current circumstances.” FVG is honoring approximate three month’s worth of service commitments, he said. “RDC has agreed to continue its support of FVG to enable us to satisfy these commitments; this support will enable us to satisfy any other customer needs during that period and to enable our employees to plan for the future.” On Oct. 1, 2007, rail operations will be suspended “until further notice.”
“RDC will continue with the actions necessary to vindicate its legal rights,” said Posner. “We will also continue to set the record straight about the grave violations and abuses committed by the government of Guatemala that have obstructed the vision that we have had as a company to make the revival of the national rail system a reality. This has been a personal burden as well as a financial one, but because of the Government's action and the lack of rule of law in Guatemala, we have no other alternative.”
Bombardier wins two new orders worth $183 millionBombardier Transportation announced this week that it has won new contracts in France and Britain worth $183 million.
French National Railways (SNCF) placed a $111 million order for 19 additional high-capacity AGC (Autorail Grande Capacite) type trains for regional service. This means that by 2011 a fleet of nearly 700 AGC trains, manufactured at Bombardier’s Crespin plant, will be operating in France.
Bombardier also won a $72 million contract to supply an additional 36 Electrostar EMU cars to Transport for London, for operation on the East London and North London railways. This order represents the first part of an option attached to an original order for 152 cars. The 75-mph cars are designed specifically for suburban service.
Ton-miles down 2.8% in first half of yearTotal U.S. railroad volume for this year’s first six months is estimated at 857.9 billion ton-miles, down 2.8% from the same period last year. Carloadings dropped 4.1% to 8,431,687 units, and intermodal volume declined 1.3% to 5,952,375 containers and trailers. In June, U.S. carload volume was down 2.7% from June 2006, and intermodal traffic declined 1.8%.
“Rail volumes remained relatively soft in June, though they were up against some very strong comparisons from last year,” said Association of American Railroads Vice President Craig F. Rockey. “Most economists are fairly upbeat about economic growth in the second half of the year, and when the economy does pick up, we can expect rail volumes to rise commensurately.”
In Canada, first half-carloads were down 0.7% and intermodal volume was up 1.6%. June carloads were down 1.8% and intermodal was up 1.8%. Kansas City Southern de Mexico reported carloads down 4.7% in he first half while intermodal volume was up 10.7%. KCSM carloads declined 4.2% in June and intermodal volume was up 7.6%.
Flooding continues to disrupt BNSF and UP serviceUnion Pacific and BNSF say severe flooding in the Midwest continues to disrupt service, and it will take at least another week to complete temporary repairs.
In a July 5 service advisory, UP reported washouts on north/south main lines connecting Kansas City, Ft. Worth, and North Little Rock. “Restoration will continue for at least another seven days and traffic on the temporary repaired route will remain slow,” said UP. While trains are being rerouted wherever possible, customers can expect delays of two days or more on shipments moving in the corridor, added UP.
BNSF said line outages had required rerouting “high volumes of trains” between Avard, Okla., and Springfield, Mo. “This is impacting service with our California to Memphis, Birmingham, Fairburn (Ga.), and St. Louis lanes,” said BNSF. Customers were told to expect delays of two to three days on traffic moving through the flooded area.
Funding pledged for Quebec short lines and portsFederal and provincial funding totaling $C63 million has been pledged for Quebec’s nine short lines and the lower St. Lawrence ports for modernization projects. The short lines will put up an additional $C25 million for the program, which includes track rehabilitation, raising load capacity to North American Class I standards, and improving connections with the main line network. Over the next five years, Quebec will contribute $C21 million more for short line intermodal improvements.
Germany seeks to buy EWS, partly owned by CNGermany’s national railway, Deutsche Bahn AG, announced that it is seeking to buy all of the shares of English, Welsh & Scottish Railway Holdings Ltd., Britain’s major freight railroad, for around $560 million. CN has a 31%% stake in the British carrier as a result of its 2001 purchase of Wisconsin Central (which acquired EWS when it was privatized). In Ottawa, National Bank financial analyst David Newman wrote in a research note that the sale could bring CN between $175 million and $200 million, and “could further augment CN’s ability to announce a stepped-up share-buyback program, which could provide an important catalyst for CN shares.
Arizona governor vetoes rail oversight billArizona Gov. Janet Napolitano has vetoed legislation that would have given the Arizona Corporation Commission the power to review any railroad plans to build new facilities on property acquired by eminent domain or through state auction. The controversial legislation also would have empowered the state to order alternate sites to be considered. The bill was a response to a Union Pacific proposal to build a yard near Picacho Peak on land to be purchased from the state.
UP extends TieTek purchase agreementUnion Pacific has signed a multi-year amendment to a current sales agreement with North American Technologies Group, Inc. (NATK) under which “a substantial portion” of the latter’s TieTek production will be delivered to UP. TieTek is a composite crosstie made of recycled plastics, discarded ties, chemicals, and other materials.
“This agreement gives the company flexibility to focus on building a robust customer base and also delivers value to its investors,” said NATK and TieTek CEO John T. Corcia. “Union Pacific has been a long-term strategic customer for TieTek and the amendment demonstrates our ability to produce large volumes of high-quality products.”
London to New York: How to make congestion pricing workMayor Michel Bloomberg’s plan to encourage motorists to take transit—not their cars—into the busiest sections of Manhattan has met with mixed reviews. But the mayor of London, who initiated a similar plan in the British capital four years ago, has sent the mayor of New York a message via the op-ed page of The New York Times, and his advice is: Try it—you may like it.
London Mayor Ken Livingstone, writing in The Times of July 2, said that while the success of the strategy in London is no guarantee it will work in New York, “it is an indicator that properly executed congestion pricing works and works well.”
After London introduced a toll of $9 a day for entering central London (it’s now $16), there was a reduction of 70,000 cars a day entering the affected zone, traffic congestion fell by almost 20%, and emissions of the greenhouse gas carbon dioxide were cut 15%. Livingstone added that there has been “a marked shift away from cars and into public transport.”
But congestion pricing carries its own price, said Livingstone: “In London, as will be the case in New York or any other city, an enhanced public transportation system was critical. To ensure readiness, we made significant upgrades in public transport,” particularly buses.
Today, said Livingstone, about $200 million a year generated by congestion pricing tolls is helping to pay for continued transit improvement.
ARI, Amsted in a new joint ventureAmerican Railcar Industries (ARI) and Amsted Industries have entered into a joint venture to manufacture and sell railcar axles. ARI, a manufacturer of tank cars and covered hoppers, and Amsted, a freight car component supplier, will each have a 50% stake in the joint venture. The companies expect to begin construction on a new axle plant later this year and have it operational by year-end 2008.
This is the second such venture for ARI and Amsted. In 2003, the two companies and The Greenbrier Companies joined forces to form Ohio Castings Co. LLC to manufacture railcar components.
Draft EIS issued for new 43-mile Utah freight lineInterested parties have until Aug. 22 to submit comments on a Draft Environmental Impact Statement (DEIS) issued by the Surface transportation Board on June 29 for a new 43-mile freight line in Sanpete, Sevier, and Juba, Utah, that would serve the Southern Utah Fuel Company coal mine and other customers that now rely on trucks for transportation. The Six County Association of Governments proposes to build the new line from a connection with the Union Pacific main line near Juba to a terminus just south of Salina.
CSX decentralizing dispatchingOver the next two years, CSX will be decentralizing dispatching of its 21,000-mile railroad network, moving to distributed, fully redundant architecture out of nine centers spread out across the eastern half of the United States.
Since 1988, the majority of CSX dispatching has been handled at the Dufford Control Center in Jacksonville, Fla., a massive, centralized facility originally equipped by Union Switch & Signal. The 1999 integration of 42% of Conrail brought dispatching centers in Albany and Indianapolis into the fold; CSX also operates a center in Chicago to handle trains in that area. The new plan calls for CSX to convert Dufford into a regional center employing 54 dispatchers, eliminating about 300 positions there, including several signal maintainer and management jobs. The dispatch offices in Chicago, Albany, and Indianapolis will be upgraded, and new dispatch centers will be opened at existing CSX facilities in Baltimore, Nashville, Atlanta, Cincinnati, Huntington, W. Va., and Florence, S.C.
CSX said employees whose jobs are affected by Dufford’s downsizing will be offered employment at the new locations, which are scheduled to be operational in 2009.
CN main line back in businessCN said it expected to resume normal operations today on its busy Toronto-Montreal main line after First Nations protesters ended a blockade of the tracks near the eastern Ontario town of Marysville that began on June 29. CN halted freight operations and embargoed all traffic after the reportedly armed protesters erected the blockade, which affected about 25 freight trains and 22 VIA Rail passenger trains that operate daily on the corridor. CN said customers should expect some service delays.