Latest News Continued

The Surface Transportation Board has determined that the railroad industry's pre-tax cost of capital for 2008 was 11.75%, slightly higher than the previous year's 11.53%.

stb_logo.jpg

This means there's still a wide gap between the cost of capital and the industry's return on investment (ROI). The STB recently announced that the average ROI in the 12 months ended June 30, 2009 was 8.94%, down from the 9.20% ROI posted in the prior 12-month period.

In the STB's most recent calculation, two railroads earned an ROI that exceeded the cost of capital—Norfolk Southern (10.33%) and Soo Line (CP), 12.09%. The ROI of other Class I railroads ranged from Kansas City Southern's 7.13% to BNSF's 9.69%.

In announcing its new cost of capital determination, the STB noted that it uses the figure "in evaluating the adequacy of individual railroads’ revenues each year" and in “determining the reasonableness of a challenged rail rate, considering a proposal to abandon rail line, or valuing a particular railroad operation.”

--> The Surface Transportation Board has determined that the railroad industry's pre-tax cost of capital for 2008 was 11.75%, slightly higher than the previous year's 11.53%. ...

bombardier-584-web.jpgBombardier Transportation's joint venture, Bombardier Sifang (Qingdao) Transportation Ltd., will build 80 ZEFIRO 380 very high speed (236 mph) trains (1,120 cars) for the Chinese Ministry of Railways (MOR). The contract covers the supply of 20 eight-car trainsets and 60 sixteen-car trainsets; Bombardier's share of the contract is estimated at $2 billion. The first train is scheduled for delivery in 2012.

“The new trainsets will be an integral part of an evolving high speed rail capability in China, which is developing more than 6,000 kilometers of new high speed lines to create one of the most advanced high speed rail networks in the world,” Bombardier said in an announcement Monday. The trains will be based on Bombardier's next-generation ZEFIRO high speed rail technology and powered by the energy-efficient BOMBARDIER MITRAC propulsion and control system.

Bombardier said the trains will also incorporate its advanced ECO4 energy saving technologies to create  “best-in-class energy and operating efficiencies.”

The ZEFIRO 380 trains will be manufactured at Bombardier Sifang (Qingdao) Transportation production facilities in Qingdao, China. Engineering will take place in Qingdao and at Bombardier centers in Europe, with project management and components provided from sites in Europe and China.

Established in 1998, Bombardier Sifang (Qingdao) Transportation Ltd. is a joint venture of Bombardier and CSR Sifang Locomotive and Rolling Stock Ltd. dedicated to supplying passenger rail rolling stock for China. It has delivered more than 1,000 passenger railcars into China since its inception, including a range of high speed trains and high-grade passenger coaches.

Bombardier Inc. President And CEO Pierre Beaudoin commented: "We are very pleased to be delivering leading-edge very high speed rail technology through Chinese expertise and resources. This illustrates the strategic importance of delivering the most advanced rail technology for China from within China."

--> Bombardier Transportation's joint venture, Bombardier Sifa ...
As rail freight traffic rebounds, making sense of “volume volatility” has been difficult, says Dahlman Rose & Co. Director Equity Research and Railway Age Contributing Editor Jason Seidl in his latest weekly analysis ...
Safetran Systems Corp., an Invensys Rail company, has appointed Glenn Sieja Vice President, Projects & Engineering, with responsibility for the strategic direction and daily management of Safetran’s transit project and application engineering organizations both in North America and int ...

Iowa Pacific Holdings says it has filed two TIGER Grantstimulus funding applications, one for each of two short line propertiesSouthwest. Each of the packages, if approved, will dramatically improve freighthandling capabilities and position the carriers to offer long-term,unsubsidized local passenger operations in their respective service territorie,the company says.

IPH seeks funds for improvements to its San Luis and RioGrande Railroad, serving south-centralColorado, including a new inland port facility to transfer products betweenrail and truck, new local passenger operations between local communities, andtrack upgrades to support heavier volumes and higher train speeds for passengeroperations. IPH claims the short line would commit to provide local passengeroperations at its own expense, without subsidy, for 20 years, linking SouthFork, Alamosa, and Antonito, Colo., with four trains per day.

A second short line, Arizona Eastern Railway, in partnership with Arizona’s Department ofTransportation, has developed a proposal to upgrade rail facilities andposition the carrier to divert thousands of truckloads of mining-relatedfreight from the two-lane highways and rural communities of southeastArizona.  Federal stimulus fundsare sought to develop a new rail spur to the Freeport-McMoran Safford minefacility and for new local passenger operations between Globe and Safford,Ariz.,  via the San Carlos ApacheReservation. 

--> Iowa Pacific Holdings says it has filed two TIGER Grantstimulus funding applications, one for each of two short line propertiesSouthwest. Each of the packages, if approved, will dramatically improve freighthandling capabilities and position the carriers to of ...

Garold B. Adams has been appointed executive vice president and Global Business Development manager of Parsons Transportation Group, Inc. (PTG), effective October 1. In his new role, Adams will lead PTG's global sales and marketing program.

parsonsadams.jpg

Adams (pictured at left) joined Parsons in 1991 and has held a succession of positions with increasing responsibilities, including manager of PTG’s Transportation Operations sector, manager of the Road & Highway Division’s Western United States sector, manager for PTG’s Southern California operations, and office manager for a former Parsons subsidiary.  His most recent position wassenior vice president and manager for the Road & Highway Division.

“Gary has a diverse engineering background and has held key roles in several of North America’s largest highway corridor design-build projects,” said Tom Barron, current executive vice president and Global Business Development managerof PTG, who will take on the position of PTG President on October 1. “He has made significant contributions to our business, and we are excited to have him serve in this capacity.”

PTG is the primary global business unit of Pasadena, Calif.-based Parsons Corp. Adams is based in Parson’ Washington, D.C., office.

--> Garold B. Adams has been appointed executive vice president and Global Business Development manager of Parsons Transportation Group, Inc. (PTG), effective October 1. In his new role, Adams will lead PTG's global sales and marketing program. ...

Rail carload traffic in the week ended Sept. 19 posted only a single-digit decline--9.6%--compared with the corresponding week in 2008. But the improvement was more apparent than real.

As the Association of American Railroads noted: "While the weekly year-over-year percentage decline was better than for the previous week ending Sept. 12, 2009, down 19.8%, this week in 2008 was impacted by service disruptions associated with Hurricane Ike." Regionally, loadings were down 4.8% in the West and 15.8% in the East.

Intermodal traffic of on U.S. railroads was down 12.4 % from last year. Container volume fell 6.29% and trailer volume was off 35.5%.

While most of the 19 carload commodity groups were down from last year, chemicals were up 17.4%, petroleum products were up 6.7 %, and farm products (excluding grain) rose 3.3%.

For the first 37 weeks of 2009, U.S. railroads reported cumulative volume of 9,831,638 carloads, down 18.2% from 2008; 6,936,253 trailers or containers, down 16.8%, and total volume estimated at 1.05 trillion ton-miles, down 17.3%.

Canadian railroads reported carload volume for the latest week down 10.7% from last year, and intermodal volume was down 11.4%. For the first 37 weeks of 2009, Canadian railroads had total volume of 2,235,077 carloads, down 22.8% from last year, and 1,500,252 trailers or containers, down 16.3%.

Mexican railroads reported 10,836 carloads in the week ended Sept. 19, down 0.8% from last year, and 6,223 trailers or containers, down 7.8%. Volume for the first 37 weeks of 2009 was 420,254 carloads, down 14.1%, and 189,297 trailers or containers, down 19.1%.

--> Rail carload traffic in the week ended Sept. 19 posted only a single-digit decline--9.6%--compared with the corresponding week in 2008. But the improvement was more apparent than real.As the Association of American Railroads ...

San Diego’s Metropolitan Transit System Thursday awarded Siemens Transportation Systems a $205 million contract for 57 light rail vehicles specifically designed to increase consist size and avoid blocking intersections in downtown San Diego. The 60-passenger LRT cars are 81 feet long, nine feet shorter than existing ones, and will be used as part of three-car consists on C Street in downtown without blocking intersections, according to MTS.

siemens_logo.jpg

"This is a major purchase of new vehicles and allows MTS to bring the convenience of low-floor light rail vehicles to our entires ystem," said Harry Mathis, chair of the MTS board, citing another customer convenience (while also complying with the Americans with Disabilities Act). "It also marks the beginning of a rehabilitation project for our Blue and Orange lines to significantly enhance our operations and customer experience.”

Siemens will manufacture the cars at its facility inSacramento, Calif, with delivery beginning in late 2011. 

--> San Diego’s Metropolitan Transit System Thursday awarded Siemens Transportation Systems a $205 million contract for 57 light rail vehicles specifically designed to increase consist size and avoid blocking intersections in downtown San Diego. The 60-pa ...

Brushing aside doubts raised by several of its own members, the Los Angeles County Metropolitan Transportation Authority Board of Directors, in an 8-3 vote, Thursday awarded a AnsaldoBreda a contract option for 100 additional light rail vehicles, holding the Italian company to its pledge to build a new rail manufacturing plant with union labor in Los Angeles.

"This means that LA is going to be the center of green jobs in the nation," said city Mayor Antonio Villaraigosa, who ardently supported AnsaldoBreda’s package. "This facility will not only provide railcars for the MTA, but for the [California] High-Speed Rail Authority, for virtually every transit facility in the hemisphere."

Countered LA County Supervisor Mike Antonovich, who voted against the contract proposal, ". . . . [Ansaldo]Breda has failed to deliver on time in two previous MTA contracts, and the current contract is already three years behind schedule in delivering certified railcars." MTA Chief Executive Art Leahy had also expressed reservations over exercising the contract option.

MTA staff has struggled with AnsaldoBreda over the production of the first 50 LRT cars, though AnsaldoBreda repeatedly has pledged to address all outstanding problems. Under the contract option, AnsaldoBreda must reduce the weight of its cars, which are 6,000 pounds too heavy, and make them compatible with the rest of the fleet.

Before the Board vote, AnsaldoBreda officials circulated an email indicating that the firm’s parent company, Finmeccanica, would back AnsaldoBreda's financial guarantees. The parent firm offered a $300 million performance bond, and a $75 million irrevocable letter of credit that could be used by the MTA if the company fails to perform. Mayor Villaraigosa and other board members said those financial terms were unprecedented.

AnsaldoBreda has contracted with Shangri-La Construction to build a 240,000-square-foot manufacturing plant on a 14-acre parcel of city-owned land at 15th Street and Santa Fe Avenue.

AnsaldoBreda Inc. President Giancarlo Fantappiè said the MTA set “very, very tough terms,” but that the move to Los Angeles would position the company to compete for future rail contracts. Among others, AnsaldoBreda faces competition from Siemens Transportation Systems, which is expanding its workforce and existing facility in Sacramento, Calif., to handle an expected surge in U.S. LRT orders. AnsaldoBreda has an assembly plant for railcars in Pittsburg, Calif., though the bulk of its manufacturing takes place in Italy. 

--> Brushing aside doubts raised by several of its own members, the Los Angeles County Metropolitan Transportation Authority Board of Directors, in an 8-3 vote, Thursday awarded a AnsaldoBreda a contract option for 100 additional light rail vehicles, holding th ...

Los Angeles County Metropolitan Transportation Authority Chief Executive Arthur Leahy says LACMTA should open a competitive bidding process to acquire 100 new light rail transit vehicles for the city’s growing LRT system. The position comes in stark contrast to the indecision of the Boardof Directors which, for months, has shied from committing to a vendor for 100 new light rail transit cars to bolster the area’s LRT fleet.

The board had repeatedly weighed the merits of a contractoption with AnsaldoBreda, currently delivering 50 cars of a base order, which offered some attractive options, including the promise by the manufacturer to establish a production facility in the Los Angeles basin. But Leahy, acknowledging that AnsaldoBreda "has made every effort to be responsive" during negotiations, nonetheless believes AnsaldoBreda’s "commitments have not been satisfactory in all areas." 

Labor unions reportedly favor the AnsaldoBreda offer, but LACMTA staff insist the company’s vehicles are too heavy and also are being delivered up to three years late. AnsaldoBreda officials defend the delays, citing change orders from MTA. LACMTA seeks the cars specifically for its Gold and Expo light rail lines, the latter of which now is under construction.

AnsaldoBreda SpA, based in metropolitan Bologna, Italy, maintains an assembly plant for rail cars in Pittsburg, Calif.

--> Los Angeles County Metropolitan Transportation Authority Chief Executive Arthur Leahy says LACMTA should open a competitive bidding process to acquire 100 new light rail transit vehicles for the city’s growing LRT system. The position comes in stark con ...
525
Page 525 of 597