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.
Employment on U.S. Class I railroads reached 159,340 in June, an increase of 1.15%, or 1,688 workers over May and a 5.16% increase over June 2010.
Train crew employment (transportation-train and engine) showed the strongest increase. The June figure of 64,111 was 1.64% higher than in May and 7.49% higher than in June 2010.
The number of maintenance-of-way and structures employees rose by 244 to 36,279 in May, an 0.7% increase, and was 3.79% higher than in June 2010.
Other employment groups also reported increases over a year ago, with the number of executives, officials, and staff assistants up 3.95% to 9,331; professional and administrative, up 3.3% to 13,824; maintenance of equipment and stores, up 3.8% to 29,126; and transportation (other than train and engine), up 2.36% to 6,669.
The figures are compiled by the Surface Transportation Board from numbers reported by the railroads.
The latest freight car market analysis from Economic Planning Associates shows that the carbuilding backlog grew about 10% in the second quarter of 2011, compared to the previous quarter
“In spite of a slowing economy, the railcar market continues to improve,” EPA said. “First-quarter orders of 36,903 units were followed by second quarter orders of 16,900 cars and intermodal platforms. Thus, even with an evaporation of 900 cars from the backlogs, and a 38.7% hike in assemblies, total industry backlogs rose from 51,900 units at the end of March to 57,300 units at the end of June. This mid-year backlog level is 2.5 times higher than the beginning year level and represents 5.4 quarters of deliveries at current production rates.”
EPA’s outlook is optimistic: “Carbuilders can expect further orders as we proceed through this year and into 2012. Already in the third quarter, a major leasing company (CIT Rail Resources) has ordered 5,000 tank cars and hoppers from a number of builders. At the same time, CSX increased capital spending by $200 million to accommodate the growing coal export market by investing in facilities, locomotives, and additional freight cars.”
In its previous report, EPA said it was “concerned about the availability of parts and components.” That appears to have changed, because carbuilders “were able to ramp up production almost 40% without any problems.” Also, “we have allowed for continued high levels of assemblies in the second half of this year to arrive at our 2011 deliveries estimate,” EPA said. “While the slowing economy might dampen demand for some car types, we remain optimistic about further gains in railcar orders and deliveries.”
Based on current backlogs and anticipated further gains in demand for a variety of railcars, EPA has forecast 37,900 cars to be delivered this year, followed by an increase to 48,300 units in 2012. Beyond 2012, EPA is projecting deliveries to climb to 51,500 units in 2013 and 62,500 units in 2016.
Such gains, EPA said, will be attributable to several factors:
• “Far stronger economic activities will provide support for certain railcar assemblies, while an improvement in the financial environment, high gasoline prices, and strong government backing will stimulate greater demand for ethanol and DDG cars,” EPA said. “Replacement pressures and technological advances as well as legislative measures will also play a role in promoting the demand for a variety of railcars.
• “Construction activities are expected to return to higher levels, which should support movements of aggregates and structural steel products. Continued expansion in demand for petroleum products, chemicals, and food and beverages will prop up haulings of a variety of liquid products and the demand for tank cars.
• “Domestic demand for coal continues to struggle while exports are advancing at a rapid clip. We are expecting some rebound in coal’s market share of electricity generation during the remainder of this year, although the sluggish nature of the economic recovery does not indicate much of rise in electricity generation in the quarters ahead. Nonetheless, any increase in electricity generation, along with a modest rebound in coal’s share of electric power output, should result in not only a pickup in coal consumption, but also in production. As of March of this year, coal stocks held by the utilities amounted to 167.0 million tons, significantly below the 177.8 million tons of inventories in March 2010. Stricter air emission standards will promote the use of lower sulphur western coal, which is also lower BTU value coal, leading to greater volumes of coal traveling longer distances. This in turn, will lead to replacements of older, smaller, steel bodied coal cars with the larger volume aluminum gondolas and hoppers of today and tomorrow. At the same time, eastern coal fleet requirements could stimulate some demand for technologically advanced steel and hybrid coal cars.
• “On a brighter side, coal exports are booming. Due to the nuclear disaster in Japan, the European reaction to a potential nuclear meltdown in Europe, and flooding in Australia that is impacting their coal exports, demand for U.S. metallurgical and steam coal is rising. Through April of this year, U.S. coal exports amounted to 35.5 million tons, 40.9% above the comparable period of 2010. Should this momentum continue through the rest of this year, we will be reaching annual export levels not seen since 1990. Foreign demand for our coal will intensify as steel producers in Asia and South America continue to drive demand for metallurgical coal while Japanese and European countries look to move away from nuclear to coal fired facilities for power generation.
• “The covered hopper market remains vibrant. Stronger production of ethanol from corn as well as a rebound in chemicals and plastics activities are stimulating demand for hi-cube equipment, while increased export volumes and greater domestic grain consumption bolster demand for midsized cars. Sharply higher energy prices are stimulating oil and gas exploratory activities, and a large number of the small-cube cars are destined to oil and gas field service companies as well as other sectors of construction.
• “Growing worldwide nutritional needs and expanding exports will pressure the current grain service cars as we proceed through the longer term while long neglected segments such as equipment to haul waste, aggregates, and limestone show signs of revival and should add to the railcar delivery mix in the years to come.
• “Light vehicle sales and production activities are improving, and we should eventually see a rebound in demand for auto parts boxcars and autorack cars, especially for replacements in the extremely aged box car fleet.
• “At the same time, interest in mill gons and steel coil cars rebounded in the second quarter. During the first four months of this year, domestic steel shipments were running 7.8% above the comparable period of last year, while first half steel mill product imports were 24.8% ahead of last year’s first half.”
“The fact that the major railroads continue to report strong revenue and profit performances due to commodities traffic growth also will benefit the railcar industry,Æ EPA concluded. “We expect the roads to continue to invest in order to accommodate anticipated commodity haulings growth. This will involve expenditures for facilities, power, and rolling stock. And, we expect railroad traffic to continue advancing over the foreseeable future, which will justify these investments. Due to the sluggish performance of coal, we look for commodity haulings to increase 2.2% this year. The 2011 momentum will carry over into 2012, at which time, commodity haulings will increase 2.0%. From 2013 through 2016, annual growth in carloadings will moderate from 1.6% to 1.4%.”
CSX is building a privately funded $15 million, 34-acre intermodal terminal in Louisville, Kentucky. The terminal, which is slated to begin operations in early 2012, will provide intermodal service to customers and consumers in the greater Louisville area.
The new terminal will be built and operated by CSX Intermodal Terminals and will employ about a dozen people. It will provide inbound and outbound daily rail service connecting through the company's Northwest Ohio Intermodal Terminal to markets across CSX Transportation’s 21,000-route-mile network. “Initial service will be designed to capture the immediate market demands of the Louisville area and provide capacity for growth,” CSX said.
The new facility will be located between CSXT’s Osborne Yard and the Louisville Industrial Center near Louisville International Airport. Trucks serving the terminal are expected to use I-65, the Outer Loop, and National Turnpike. The terminal development project includes the installation of new track, pavement, drainage, gates for inbound and outbound containers, and the refurbishing of two buildings for use as office facilities.
“CSX consistently looks to provide quality rail service for the regions it serves,” said CSX Intermodal Terminals President Wilby Whitt. “We have a long and proud history of helping Kentucky's economy thrive, and we believe this new facility will help increase the benefits available to businesses and residents in the greater Louisville region.”
Louisville Mayor Greg Fischer said the CSX’s investment “is welcome news on many fronts. It is a statement of confidence in the region’s economy by a private sector company. It will create jobs, and it will further strengthen the region’s transportation infrastructure, providing businesses access to more efficient, cost-effective transportation.”
A preliminary count by the Federal Railroad Administration Office of Safety Analysis shows that U.S. railroads reported 290 rail-related fatalities in the January-May period of 2011. Fatalities at highway-rail grade crossings totaled 110, vs. 104 in the 2010 period, an increase of 5.8%. Trespassing fatalities were essentially flat—167 in this year’s first five months vs. 166 in the corresponding 2010 period.
Total accidents/incidents reported by 730 large and small railroads added up to 4,273 in January-May this year, down 5.9% from last year’s ago 4,675.
The number of collisions increased 20.4% to 65; derailments were up 7.7% to 587; and yard accidents declined 1.8% to 427.
The number of employee fatalities increased to nine in January-May this year, compared with seven in the 2010 period.
Iowa Pacific Holdings, LLC has agreed to sell the Arizona Eastern Railway Co. to Genesee & Wyoming, Inc. in a $90.1 million cash transaction, subject to post-closing adjustments.
The Arizona Eastern was chartered in 1895 as the Gila Valley, Globe & Northern, and was constructed between Bowie and Miami, Ariz., about 133 route-miles. In the final two decades of the 20th Century, it changed hands several times. When IPH purchased it in 2004, “it was in severely deteriorated condition,” the company said. “IPH worked with all stakeholders to improve track and bridge conditions, and to develop additional freight business.” In 2008, the Arizona Eastern purchased an additional line between Clifton, Ariz., and Lordsburg, N.Mex., and connected through trackage rights over the Union Pacific to the original Bowie line.
“As a result of all these actions, since 2004, the Arizona Eastern’s freight traffic has grown dramatically, track speeds have increased, and there has been a significant reduction in derailments and a corresponding improvement in other safety metrics,” said IPH President Ed Ellis. “We are grateful to the hard working men and women of the Arizona Eastern for their diligence and creativity in assisting us with the turnaround of this important rail property. We also acknowledge the instrumental contributions of the major customer, Freeport McMoRan Copper and Gold, toward track and bridge rehabilitation. We are confident that G&W will take Arizona Eastern to the next level in service and condition of its physical plant, and are pleased to hand the reins to G&W.”
IPH is a privately-held operator of freight and passenger short line railroads in the U.S. and U.K., focusing its acquisitions on turnaround opportunities.
Rising from the destruction inflicted by the 9/ll 2001 terrorist attack, the New York Metropolitan Transportation Authority’s new, $1.4 billion Fulton Street Transit Center in lower Manhattan reached a milestone Tuesday with the opening of the 135 William Street entrance.
The Center is more than 50% complete and on schedule for a June 2014 completion. When finished, it will connect five subway stations and eleven subway lines, improving access for more than 300,000 daily riders.
“We have reached yet another significant milestone as we move forward to complete what will become a landmark transportation facility,” said MTA Chairman and CEO Jay H. Walder. “Once complete, this complex will provide our customers with a more seamless experience at this major downtown hub. The Transit Center will improve travel for hundreds of thousands of daily commuters and Lower Manhattan residents and visitors while providing a modern and convenient retail location.”
MTA said other elements of the complex continue to progress. Superstructure steel for the transit center building is slated for completion this fall. The southbound Cortlandt Street platform will reopen on or before Sept. 11. Station rehabilitation on the 4/5 lines continues and the Dey Street Concourse is structurally complete. Restoration of the historic Corbin Building is continuing inside the 1888 landmark and is expected to be complete in late 2012.
Short line holding company Regional Rail LLC on Aug. 1 commenced operations in southeastern Pennsylvania on the York Industrial Track, which it has leased from Norfolk Southern. The York Industrial Track, which runs from York to Stony Brook, Pa., is now operated as part of Regional Rail subsidiary East Penn Railroad LLC, which serves southeastern Pennsylvania and Delaware. The new operation connects to NS and York Railway at York.
“We want to thank Norfolk Southern for its efforts and support in achieving a seamless start of our operations in York, and we look forward to working with NS to grow the business on this new line,” said Regional Rail President and CEO Bob Parker. Added Regional Rail Vice President Al Sauer, “We have been pleasantly surprised by the number of new business opportunities that customers have shared with us already. East Penn’s operation of the York line is off to a nice start. ”
Regional Rail LLC, based in Kennett Square, Pa., is also the parent company of the Middletown & New Jersey Railroad LLC, which owns and/or operates four short lines in southeastern New York State.
In the past two months, the Greenbrier Companies has received orders for 3,700 new railcar platforms valued at approximately $285 million. Combined with orders received since September 1, 2010 (the beginning of Greenbrier's fiscal year), Greenbrier’s cumulative number of railcar orders order now exceeds 18,000 units.
The latest orders are primarily for doublestack intermodal platforms, boxcars, covered hopper cars, and tank cars for the North American market, and various car types for the European market. Delivery of these orders is anticipated to occur principally in calendar 2012.
Greenbrier opened an additional new railcar production line in July and expects to open another in the first quarter of fiscal 2012, “in order to accommodate the increased demand in North America,” the company said. “In addition, production rates for tank cars are expected to increase on an existing production line in North America in late calendar 2011 to accommodate the expanding customer base for this type of railcar.”