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.
Bellevue, Wash., has released drafts of a proposed agreement between Sound Transit and the city to finance a $300 million light rail transit tunnel through the municipality’s downtown. Bellevue’s City Council has the option of passing the agreement, asking for more time, or taking no action at all at its next meeting, set for Monday night. Some council members have made clear their desire for more time to evaluate the proposal. Under the agreement with Sound Transit, Bellevue would be responsible for as much as $160 million of the tunnel's projected cost. Of that, $100 million of that would come in 2014 or 2015 through actions such as donation of land and utility improvements, leaving Sound Transit to commence construction with its share of funding. If tunneling costs are less than anticipated, Bellevue would pocket any savings. Bellevue has said it welcomes light rail transit, part of Sound Transit's East Link project, a 22-mile extension linking Seattle with Redmond, Wash. But Bellevue has expressed concern that LRT could disrupt businesses and generate safety concerns. Sound Transit has noted that tunneling drives up the cost of LRT construction.
The document includes several options for both parties to terminate the agreement if future disputes arise. The city reportedly gets an out if Sound Transit refuses to adopt the city's requested design changes. Sound Transit reportedly can opt out if Bellevue does not grant a number of permitting changes by the end of 2012. Sound Transit is expected to act on the agreement at its Oct. 27 meeting.
Milestone Equipment Corp. and Scrap Metal Services LLC on Monday announced the acquisition of 7,300 intermodal dry van trailers.** The heavy-duty dry van trailers are operated under leases throughout North America in rail intermodal service. Financial terms of the transaction were not disclosed. Tiburon, Calif.-based Milestone Equipment and Burnham, Ill.-based Scrap Metal Services said they have created a new joint venture, Scrapstone Intermodal Services, LLC for this transaction as well as for future intermodal opportunities. In a statement, Milestone’s President and founder Robert Thull said, “Milestone is now the largest domestic intermodal container and intermodal trailer equipment lessor. We are committed to continued rapid growth and investment in intermodal equipment to provide flexible operating leases to our customers.” Scrap Metal Services CEO Jeffry K. Gertler said, “This acquisition allows Scrap Metal Services to expand its role in the intermodal marketplace, a market segment that we believe will experience considerable growth over the next several years.”
**Editor's Note: The original report stated the intermodal equipment was purchased from GE Capital. An amended statement issued Tuesday by Milestone Equipment Corp. noted the attribution was in error.
Wilmerding, Pa.-based Wabtec Corp. Tuesday reported record third-quarter earnings of $46.6 million, or 96 cents per diluted share, 33% higher than the comparable quarter in 2010. Sales also set a record at $499 million, also up 33% from a year ago, which Wabtec attributed to strong growth in its Freight Group. Per-share earnings beat Wall Street consensus analyst estimates of 87 cents per share.
Wabtec’s backlog at the end of the third quarter was $1.5 billion, 38% higher than at the beginning of the year. Albert J. Neupaver, Wabtec’s president and chief executive officer, said: “Wabtec continued to perform at a high level in the third quarter and we expect to finish the year strongly. We are executing our growth strategies well, benefiting from favorable market conditions in the freight rail sector, and beginning to see a ramp-up in positive train control activities. We remain optimistic about our outlook for the balance of the year, and believe we are well positioned over the longer term to take advantage of growth opportunities in our core markets around the world.”
Neupaver’s optimism was backed by Steve Barger, an analystwith KeyBanc Capital Markets Inc., who noted, “On the back of this strongperformance, [Wabtec] increased its 2011 guidance to $3.65-$3.70 from$3.45-$3.55, and increased the top-line expectations to 25% growth (from theprevious guidance of 20%). We estimate this implies 4Q11 results of $0.90-$0.95and revenue of around $450 million.”
Alcatel-Lucent and Adif, a Spanish state-owned company responsible for the management of Spain’s railway infrastructures, on Tuesday said they have signed a collaboration agreement for the testing of communications technologies for use on railway transportation systems. Teams will test how a single IP-MPLS multi-service and mission critical network can support GSM-R systems, fulfilling the highly demanding railway quality and security specifications, optimizing network build and operation, and improving network service capabilities.
Additionally, the teams will investigate how a LTE mobile broadband system for railways in conjunction with IP convergence can handle different types of traffic such as voice, data and video, to standardize communications across railway networks. The companies will also develop integrated multimedia solutions for improving passenger information systems. Alcatel-Lucent and Adif will test these technologies in Adif’s new Railways Technology Centre in Malaga, Spain, which has been created to foster innovation and enterprise collaboration around railway technology. The center is intended to be a base for global research and development of communications for high-speed train transportation. This collaboration project is designed to help strengthen Spain’s position at the head of global and European railway system technology.
The framework agreement also covers related activities such as: the collaboration and submission of joint R&D proposals for European and domestic grant opportunities; the development of innovative scientific projects of interest to both companies; the creation of working groups and reports for the development and follow-up of scientific findings; and joint co-operation in training programs if required by the projects.
A $250,000 study by Parsons Brinckerhoff, due to be publicly released soon, is expected to endorse a proposal to extend New York City Transit’s No. 7 subway line under the Hudson River to Secaucus, N.J. The proposal, strongly backed by Mayor Michael Bloomberg, is becoming a rising priority for the mayor, who already has committed city funding to extending the No. 7 from Times Square to Manhattan’s West Side. The mayor reportedly wants to get the project under way before leaving office at the end of 2013. A No. 7 extension to Secaucus would expand the city’s subway system outside the boroughs—let alone across the state line—for the first time ever. Though the New Jersey terminus would be at New Jersey Transit’s Secaucus Junction Station on the Northeast Corridor, other stops might also occur in Hoboken or Weehawken, N.J. Officials in Hudson County, N.J., and the New Jersey Governor’s office also have expressed interest in the idea. Christie last year terminated an $8.7 billion tunnel project to expand NJ Transit rail capacity under the Hudson River, labeled Access to the Region's Core (ARC). Early cost estimates for a No. 7 tunnel are in a similar cost range.
A spokesman for New Jersey Gov. Chris Christie said Tuesday, “We have been intrigued all along by this as a potential alternative” though New Jersey rail advocates point out the ridership market of the No. 7 subway extension would be more local and urban, and therefore different, from the now-dead ARC project.
Norfolk Southern Corp. late Wednesday announced record third-quarter net income of $554 million, up 24% compared with the same period of 2010. Diluted earnings per share were a record $1.59, up 14%.
Railway operating revenues rose 18% to $2.9 billion, primarily due to result of a 14% increase in revenue per unit. The operating ratio improved by 2.1 percentage points to a third-quarter record 67.5%.
“Norfolk Southern produced another outstanding quarter, setting all-time records for income from operations and earnings per share, while also establishing third-quarter records for net income and operating ratio,” said Norfolk Southern President and CEO Wick Moorman. “We continue to see modest improvement in most of our business groups, and we remain focused on the long-term enhancement of our franchise.”
General merchandise revenues were $1.4 billion, 12% higher compared with third-quarter 2010 results. Coal revenues increased 27%, to $899 million, compared with the same period last year. Intermodal revenues were $551 million, 19% higher compared with the third quarter of 2010.
Railway operating expenses for the quarter were $2.0 billion, 14% higher compared with the same period of 2010, primarily due to increased fuel expenses, which rose by $126 million, and compensation and benefits costs.
Income from railway operations climbed 26% to an all-time record $938 million compared with the same period last year.