William C. Vantuono, Editor-in-Chief

William C. Vantuono, Editor-in-Chief

With Railway Age since 1992, Bill Vantuono has broadened and deepened the magazine's coverage of the technological revolution that is so swiftly changing the industry. He has also strengthened Railway Age's leadership position in industry affairs with the conferences he conducts on operating passenger trains on freight railroads and communications-based train control.

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A reduced expansion plan for Interstate 5 in San Diego could free up nearly $800 million to be redirected to light rail transit (LRT) expansion, as well as pedestrian and bicycle improvements, according to the San Diego Association of Governments (SANDAG).

SANDAG has approved the redistribution plan, following a decision by the California Department of Transportation expand I-5 by only four lanes instead of six. SANDAG had originally budgeted for a six-lane expansion in the metropolitan transportation organization’s 40-year regional transportation plan.

Almost $600 million would be directed toward smart-growth developments and railroad at-grade separation projects. SANDAG also would accelerate some LRT projects, including the Mid-City LRT route running from downtown to San Diego State University along El Cajon Boulevard.

The "Safe Routes to Transit" program would receive about $200 million, with much of the money used to establish safe biking and pedestrian routes.

Progress Rail Services plans to locate a locomotive manufacturing facility in Sete Lagoas in the state of Minas Gerais, Brazil, to serve the South American diesel-electric market.

progress_rail_services_cat_logo.jpgProgress Rail, a subsidiary of Caterpillar Inc., said in an announcement Monday that it will operate the facility through its subsidiary, MGE Equipamentos e Servicos Ferroviarios Ltda. (MGE). The project could create up to 600 jobs at full capacity.

The company said it will make a “significant investment to reopen and modernize the existing manufacturing plant.”

The facility will assemble and manufacture Electro-Motive Diesel-branded locomotives in the 12,000 square-meter space. Electro-Motive Diesel Inc. is a subsidiary of Progress Rail Services.

“We are proud to announce the opening of this state-of-the-art facility, which will allow us to produce locomotives locally for our Brazilian customers, and also continue to provide quality products to our customers around the world,” said Billy Ainsworth, president and chief executive officer of Progress Rail Services.
Monday, 25 July 2011 11:39

Intermodal helps drive CN earnings up

CN Monday reported second-quarter results, saying its net income increased from the year-earlier quarter to C$538 million, with earnings per share rising 4% to C$1.18. Excluding a deferred income tax expense, adjusted diluted EPS for the second quarter of 2011 rose to C$1.26.


Revenue for the second quarter was up 8% to C$2.2 billion as carloadings increased 4% and revenue ton-miles rose 5%. Operating income increased 8% to C$874 million. CN’s operating ratio, 61.3%, was essentially in line with the operating ratio of 61.2% for second-quarter 2010.

Claude Mongeau, president and chief executive officer, said: “CN delivered a solid second-quarter performance as a result of continued improvements in freight volumes and strong operational execution. CN railroaders responded quickly and effectively to a series of weather challenges including floods, forest fires, and mudslides. Their tireless efforts and dedication helped to protect the integrity of our network, the reliability of the supply chain we serve, and our service to customers.”

Mongeau said that intermodal—CN’s largest revenue segment—was “a bright spot,” benefiting principally from higher import volumes over the ports of Vancouver and Prince Rupert and increased domestic retail shipments. Total intermodal volumes rose 10% and intermodal revenue increased 14%.

“Intermodal was one of the first areas where we applied our new end-to-end supply chain collaboration approach,” Mongeau said. “This approach is really starting to pay off, and we hope to enjoy gains in other segments of our business where we have brought forward a similar focus on innovation and service excellence.”

CIT Rail, which owns more than 100,000 railcars leased to approximately 500 customers in North America, has announced orders for 5,000 new tank cars and hoppers from “multiple manufacturers.”

Deliveries are scheduled throughout 2012. The orders include an option for an additional 1,750 railcars that was part of an order for 3,500 cars earlier this year. The company said the new orders respond to increasing demand as the the economic recovery continues.

“It is important that we maintain a young, modern fleet of high-quality railcars that enable carriers and shippers to maximize loading efficiencies while transporting goods,” said George Cashman, president of CIT Rail. “These orders reinforce our commitment to the rail transportation industry and will allow us to capitalize on growth opportunities within the market.”
Tuesday, 26 July 2011 06:46


Fairport, N.Y.-based RailComm says ithas been chosen to provide its Track Warrant Control (TWC) System for Chile’s Empresa de los Ferrocarriles del Estado (EFE). RailComm’s Domain Operations Controller (DOC®) train control system will be used for dispatching and train management.

railcomm_logo.jpgEFE will have two dispatch centers in Santiago City and Concepcion City for the monitor and control of trains within 2,000 kilometers of the rail system.

The DOC System will interface with EFE’s existing software systems and will be able to be toggled between Spanish and English, with the Spanish language included in all track warrant and track bulletin forms, as well as in the Graphical User Interface.
Tuesday, 26 July 2011 07:04

Wabtec backlog hits record $1.51 billion

Wabtec Corp. has reported second-quarter results, including sales of $479 million, 28% more than the year-ago quarter, and a backlog of undelivered orders totaling $1.5 billion. The company also increased its full-year guidance excluding a previously announced charge for a court ruling that Wabtec is planning to appeal.

wabtec_logo.jpgExcluding special items, earnings per diluted share were a record 94 cents, 45% higher than in the 2010 quarter, and income from operations was a record $72 million, or 15% of sales compared with 13.3% a year ago.

Based on second-quarter results and the outlook for the rest of the year, Wabtec increased its 2011 guidance for earnings per share to between $3.45 and $3.55 excluding special items, with revenue expected to be up about 20%.

Albert J. Neupaver, Wabtec’s president and chief executive officer, commented, “The company's second-quarter operating performance was strong,as we continued to execute our growth strategies and benefited from favorable market conditions, particularly in the freight rail sector. Based on our performance to date and our record backlog, we are optimistic about our outlook for the balance of the year. Longer-term, we are well positioned to take advantage of growth opportunities in our core markets around the world.”
Tuesday, 26 July 2011 11:11

NS notches 2Q earnings record

Norfolk Southern Tuesday reported record second-quarter net income of $557 million, 42% higher than the $392 million notched during the same quarter in 2010. Diluted earnings per share were a record $1.56, up 50% compared with $1.04 per diluted share earned in the same period a year ago. NS said the results reflect favorable, non-recurring income tax-related benefits totaling $63 million, or $0.18 per share.

ns_logo.jpgThe company’s operating ratio improved to 69.5%, a second-quarter record, compared with 69.8% during the second quarter of 2010. Operating revenue increased 18% to $2.9 billion, also a second-quarter record.

“Norfolk Southern delivered excellent financial results in the second quarter, setting all-time records for net income and earnings per share, as well as second-quarter records for revenues, operating income, and operating ratio,” said Chairman, President, and CEO Wick Moorman. “We’re seeing opportunities in the global economy, and we are moving forward with initiatives to drive business growth, productivity, and efficiency across our company.”

General merchandise revenue, at $1.4 billion, was up 12% from the year-ago quarter, while coal revenue rose 28% to $893 million compared with the year-ago period. Intermodal revenue of $540 million was up 20% from a year ago.

Railway operating expenses for the quarter were $2.0 billion, 17% higher compared with the same period of 2010, which NS attributed primarily to increased fuel expenses and compensation and benefits costs.
Wednesday, 27 July 2011 04:03

Flooding bogs down CP 2Q profitability

Flooding kept Canadian Pacific from joining its Class I brethren in setting record-breaking second-quarter results, with CP Wednesday reporting its second-quarter net income fell to C$128 million (US$135.7 million), or 75 Canadian cents per share. That still beat analyst expectations by two cents, but was 23% lower than the C$166 million, or 98 Canadian cents a share, posted in the second quarter of 2010.

cp_logo_2009.jpgRevenue rose slightly to C$1.26 billion, up from C$1.23 billion in 2010, but the improvement was limited by the impact of flooding on operations. CP said it recorded nearly 90 separate outages on its tracks during the three-month period ended June 30.

"We rerouted and detoured traffic over other railways and incurred significantly higher operating costs to ensure delivery of our customers' shipments," said President and CEO Fred Green in a release.

CP said operating expenses rose to C$1.03 billion from C$960.1 million a year earlier, prompted largely by increased fuel prices.
Wednesday, 27 July 2011 09:33

China crash mars stellar HSR safety record

The collision of two high speed rail trains near Wenzhou, China, on July 23 has triggered doubt, both domestically and internationally, not of HSR’s viability but of China’s expertise to implement its HSR plans, in part because HSR for decades has operated nearly flawlessly in Europe and in Japan.

At least 43 were killed, and more than 200 seriously injured, when one HSR train reportedly lost power, attributed by Chinese railway officials to a lightning strike, which then disabled safety devices. The first train was then hit by a second HSR consist following the first train. The incident occurred roughly 860 miles south of Beijing.

Many rail industry observers have expressed outright skepticism about China’s explanation of the HSR incident. “I’ve never heard of lightning doing that, but if it did, everything else would stop, too,” Vukan R. Vuchic, professor of City and Regional Planning, University of Pennsylvania, told The New York Times. “And the signal system should keep trains at a safe distance.”

China’s aggressive push for HSR has been criticized on several levels, with its reliability and safety questioned from the onset when power problems plagued the debut of Beijing-Shanghai service in June. Corruption forced the government to fire at least three high-ranking railway officials, including Railways Minister Liu Zhijun in February.

Immediately following the crash, the Ministry of Railways called for a two-month nationwide safety check and announced that three senior officials in the Shanghai Railway Bureau had been dismissed pending an investigation.

Manufacturers of HSR equipment, particularly from Japan, have alleged both privately and publicly that HSR equipment in China, produced by China South Locomotive and Rolling Stock Corp. Ltd. (CSR), have liberally “borrowed” from proprietary designs of other, more established HSR equipment producers.

More openly, CSR has formed a partnership with General Electric Co. to develop HSR technology for global export, and had been considered a likely, even favored, bidder for California’s 700-mile HSR project. The Wenzhou accident could seriously damage any marketing push of Chinese HSR technology in California or elsewhere, one source knowledgeable of California’s efforts tells Railway Age.

As for safety, “If China is going to take HSR from international to global, then we will need a global body devoted to rail safety like the Flight Safety Foundation does for aviation,” Anthony Perl, director, Urban Studies Program, at Simon Fraser University in Vancouver, British Columbia, told Railway Age.


 “In part, that’s because China’s visions for HSR far exceed that of even existing HSR mileage now in operation. “A rail analog to the Flight Safety Foundation” might be required “if HSR is to remain a safe mode while meeting much higher volumes of global mobility, Perl said.

Wednesday, 27 July 2011 10:42

Trinity 2Q earnings grow, as does backlog

Dallas-based Trinity Industries, Inc. Wednesday reported a second-quarter earnings of $30.0 million, or 37 cents per diluted share, up from $18.4 million, or 23 cents per diluted share, in the second quarter of 2010. Revenue of $710.5 million was up from $543.1 million for the year-ago period. Wall Street analysts expected 38 cents per diluted share, however, and shares of the company fell as much as 10% Wednesday afternoon on the New York Stock Exchange.

For the quarter, the Rail Group reported revenue of $280.7 million and an operating profit of $15.4 million, compared with revenue of $112.9 million and an operating loss of $2.7 million in the second quarter of 2010. The Rail Group shipped approximately 3,115 railcars and received orders for approximately 7,860 railcars during the second quarter. As of June 30, 2011, the Rail Group backlog grew to approximately $2.2 billion, representing approximately 27,240 railcars compared with a backlog of approximately $1.8 billion as of March 31, 2011, representing approximately 22,490 railcars.

“We continue to be encouraged by the level of demand for products in our railcar and barge businesses. This is reflected in their improving order backlogs,” said Timothy R. Wallace, Trinity's chairman, CEO, and president. “Subsequent to quarter end, we also announced a successful refinancing of a portion of our railcar leasing company’s debt, which is important for the growth of that business.”

Also encouraged is Steve Barger, director, Industrial Manufacturers, KeyBanc Capital Markets Inc. “Given the strength of Trinity's and the industry's second-quarter orders, our view that industry pricing is improving, and our general thesis that railcar manufacturers enjoy significant operating leverage as volume improves, we think investors should be buyers on weakness as we continue to think TRN is on the front end of accelerating EPS as the cycle improves,” Barger said in an analyst note Wednesday.
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