Transportation (train and engine) employees led the way in employment gains for the second straight month, increasing 5.59% in July vs. one year ago, powering an overall Class I railroad employment rise of 1.91% to 152,925 in the 12 months ended mid-August, the Surface Transportation Board reported.
Total employment fell a slight 0.08% from levels reported for mid-July, with Transportation (train and engine) down 0.14%, STB reported.
Professional and Administrative also gained over year-ago levels, up 3.54%. Those gains helped offset year-over-year declines in Executives, officials and staff assistants (down 1.84%), Transportation (other than train and engine), down 1.09%, Maintenance of way and structures (down 1.02%), and Maintenance of equipment and stores (down 0.74%).
Categories of employment gaining from July included Executives, officials, and staff assistants (up 1.02%), Maintenance of equipment and stores (up 0.02%), and Transportation (other than train and engine), up 1.07%.
Declines from July were relatively modest. Professional and administrative employees declined by 0.21% month over month, as did Maintenance of way and structures (down 0.49%) and Transportation (train and engine), down 0.14%.
The debate is heating up over suspension of any new work on New Jersey Transit’s planned new trans-Hudson commuter rail tunnels, a project for which ground was broken last year but whose $8.7 billion estimated cost has led to second thoughts in a financially strapped state.
New Jersey Gov. Chris Christie, a Republican and a fiscal conservative, last week put the project on a 30-day hold, asserting, “If I can't pay for it, we'll have to consider other options.” He said work already started will continue on the New Jersey side of the river pending a final decision.
New Jersey’s two U.S. senators, Frank Lautenberg and Robert Menendez, on Friday joined other Democratic leaders at the work site to defend the project, which is designed to significantly increase commuter rail capacity across the Hudson.
“Don't throw away $6 billion; don't throw away thousands of jobs,” Lautenberg (pictured at left) urged. Advocates claim the project would generate around 6,000 jobs.
The Port Authority of New York & New Jersey has pledged $3 billion toward the cost of the project, and the Federal Transit Administration has agreed to match that.
Raymond J. Lesniak. the Democratic chairman of the Economic Growth Committee of the State Senate, acknowledged that “there's going to be a couple of billion dollars shortfall,” but he said the state should be looking for ways to close the funding gap rather than abandon the project.
An FTA spokesman said Thursday, following a meeting of Governor Christie with U.S. DOT Secretary Ray LaHood: “Given that this project represents the single largest transit investment ever made by the Federal Transit Administration, the secretary and governor agreed to have staff work together to further refine estimated cost of the entire project.”
A hearing on the project was scheduled Monday in Trenton, the state capital, by the Assembly Transportation, Public Works and Independent Authorities Committee.
In a story dispatched from Lucknow, India, on Friday, the Business Standard, a daily newspaper in that country, reported that LaGrange, Ill.-based Electro-Motive Diesel announced in a conference call that it will invest $100 million in India during the next three years in a manufacturing unit. The occasion was the launch of the EMD Centre of Excellence at Lucknow.
“Although the exact location of the plant has yet not been finalized, the company has prospective sites in consideration, including Uttar Pradesh,” EMD COO Ossama Hassan said. “After North America, India is our most important market. ... While still in the initial stages, the production unit would cater to the domestic demand in India. We will later try to tap the export market, too.”
EMD is a wholly-owned subsidiary of Progress Rail Services, based in Albertville, Ala.
The Ottawa Chamber of Commerce has issued a statementbacking the city’s C$2.1 billion (US$2.7 billion) Light Rail Transit Plan. The backing is considered politically significant, given the contentious nature of the project stretching across many years.
The group is recommending that the city “accelerate” its east-west LRT expansion plans, saying the current time table will “reduce the accessibility of the system and negatively impact ridershipand revenue generation for OC Transpo.”
LRT is the “best option” for keeping operational costs down and providing environmental benefits, the Chamber said. Executive Director Erin Kelly said businesses across Ottawa will "benefit from an easy-to-use transit infrastructure.”
But Kelly also said the City of Ottawa should accelerate plans to expand light rail east into Orleans and west into Nepean and Kanata, saying “if people are forced to transfer at Tunney's Pasture or Blair Road ridership will suffer.”
Last June the federal government committed C$600 million (US$783 million) in funding for the project, which includes a two-mile tunnel in downtown Ottawa. Ontario committed another C$600 million to the project last December.
Russian Railways announced Friday that it and the French National Railways (SNCF) will sign a Joint Declaration on Developing Cooperation in International Passenger Transport at the InnoTrans-Messe Berlin International Trade Fair, Sunday, Sept. 26, in Berlin.
The signing will take place at the Russian Railways booth. The signatories, Russian Railways President Vladimir Yukinin and SNCF Chairman Guillaume Pepy, will describe the goals of the declaration at a press briefing following the signing.
Mike Franke, Amtrak Assistant Vice President-State and Community Partnerships and Senior Director, Planning and Business Development (below), presented on “The Future of High Speed Rail and the Role of the Supply Community”:
“Why do we need passenger rail? Competing modes are congested and getting worse. The number of urban areas with more than 20 hours of annual rush hour traffic delay increased sevenfold between 1982 and 2007. Between 2000 and 2008, the number of flight delays due to airport terminal volume increased by 42%. Passenger rail’s niche is the sub-500 mile intercity market, and it's a big one. More than 79% of total trips the USDOT classified as ‘long distance’ (50-plus miles) falls into this category, and the number of Americans living in urban areas is expected to double to 300 million by 2050. As well, passenger rail is a safer, greener, healthier choice.
“Amtrak currently partners with 15 states to offer service.The long-distance routes provide the national network. On top of this foundation, we are focusing on developing state-supported corridor services-isa foundation. The magic number for ridership growth is offering at least five round-trips a day, and the keys are service reliability and frequency. High speed is a noble goal, but unless we fix the terminal problems, there's little benefit to going 90-110 mph in the cornfields of Iowa.
“We've got to fix Chicago. It's key to the entire Midwest. The CREATE Project is designed to do this, and there are several of them critical to the Chicago Hub high speed and intercity rail network.”
As an example, Franke pointed to the $1.1 billion federal grant to the Chicago-St. Louis HrSR (higher speed rail) corridor, which usesUnion Pacific right-of-way. Completion of this project, including installation of PTC, will increase maximum speed to 110 mph and service frequency to eight roundtrips per day (it’s currently five). The federal grant is the third-largest award overall in the FRA’s high speed rail program. The initialinvestment will result in faster service by decreasing trip times by a little over an hour between end points.
Franke spoke about Amtrak’s fleet replacement program and implications for the domestic supply base:
“Amtrak equipment is run very, very hard. The age of equipment is at an all-time high. The average Amtrak car is now older than the average car we inherited from the freight railroads in 1971. Our Heritage Fleet equipment is pushing, and in some cases past, 60 years. Our annual car-miles are the highest in U.S. passenger rail. The lack of homogeneity—multiple classes of equipment for short and long distance and corridor service—complicates maintenance. Some classes have 300-plus cars, some 50 or fewer. Complete standardization will never be possible, but we need to reduce the number of classes and mechanically distinct variants. Mass obsolescence is a problem.
“The supply base for new equipment is limited, as a lack of market demand led to market exit. Transit and commuter rail have taken the attention of remaining manufacturers. Amtrak needs to take a lead, or the market will not offer equipment optimized for intercity service, the limited range of choices may lead to increased cost and risks, and the industry may continue to atrophy.”
Franke touched upon the Section 305 Committee, which was established under PRIIA (Passenger Rail Improvement and Investment Act of 2008) to the determine types of equipment and quantities needed for corridor service, establish an equipment pool to be used on corridors funded by participating states, and involve Amtrak in the process of design, maintenance, and rebuilding:
“There are a whole range of goals. Interoperability, and opportunities for economies of scale and all-around savings, are significant. Seeding the domestic railcar manufacturing industry is also important. There is a need to be able to provide production runs that will attract and sustain an industry. Creation of a specification for bilevel cars, which the FRA approved on Aug. 31, 2010, is an important step toward standardization.”
With regard to federal surface transportation reauthorization, which is now in progress, Franke said it “represents a major opportunity to address issues of national interest, including congestion, pollution, and energy costs. This bill can build on recent progress by establishing a policy foundation we will need for real growth in rail. This will establish a level playing field that will make up for decades of neglect by establishing a dedicated funding source for intercity passenger rail; embrace a mode-neutral policy framework as an end goal; define the Federal vision, define Amtrak's role; and identify and select strategic outcomes.”
Franke concluded by commenting on Amtrak’s relationship with its freight railroad hosts: “It gets a little cantankerous with the legislation that the railroads have had rammed down their throats, like PTC. However, day-to-day operation are on good footing, and there are mechanisms in place to address things like on-time performance isues. We are cognizant of the fact that the freight railroad franchise has to be protected. Unfortunately, some passenger rail advocates don't understand the importance of that. They mistakenly think that it’s simply a matter of selecting a section of railroad and putting passenger trains on it. It doesn’t work that way.”
—William C. Vantuono, Editor
David Nahass (below), Senior Vice President, Railroad Financial Corporation, spoke about the present state of the freight car and locomotive leasing marketplace, and a fundamental change coming in federal accounting standards:
“From Railroad Financial's perspective, there isn't a whole lot of optimism in the marketplace, despite that freight traffic is coming back. We see opportunistic railcar and locomotive sales and purchases going on throughout the marketplace. There is a lack of a fundamental appetite for risk today—no speculative appetite for off-lease equipment or equipment coming off lease.
“Changes in federal accounting standards from FASB (Federal Accounting Standards Board, which reports to the Securities and Exchange Commission) are under way that will significantly impact the freight car andlocomotive leasing marketplace. There are three basic things to keep in mind”:
• The end of off-balance-sheet leasing, where everything is treated as a capital lease.
• The end of traditional leveraged leases. Banks will be required to take non-recourse debt and put it on their balance sheets.
• No more grandfathering for existing leases.
“Timing for implemenation is roughly 2015, but we will see the market begin to respond once the final changes are approved,” Nahass concluded. “Exactly how is a challenge to figure out, but the cost of leasing is expected to increase.’
Added RFC President and Railway Age Financial Editor Tony Kruglinski (at left), “Certain elements in the industry are considering selling thelessee the transportation services, much like FedEx and UPS, instead of leasing the equipment. The interesting thing is that today’s lessors would become the railroads' customers.”
The Association of American Railroads Thursday said U.S. freight carload traffic slowed duringthe Labor Day holiday; while traffic rose 5.1% compared with the same week in 2009, it was down 15.5% compared to the same week in 2008. The comparison weeks from 2010 and 2009 included the Labor Day holiday, while the comparison week from 2008 did not, AAR noted.
Fifteen of the 19 carload commodity groups increased from the comparable week in 2009, led by metallic ores, up 129.9%, and farm products excluding grain, up 38.7%. Three carload commodity groups, led by farm products excluding grain, posted an increase over the 2008 comparison week.
U.S. intermodal advanced 18.1% from the same week in 2009, but was down 12.7% compared with 2008.
Canadian freight carload traffic was up 12% from last year, while intermodal gained 23%. Mexican railroads reported freight carload traffic rose 24.5%, while intermodal advanced 9.1%.
Combined North American rail volume for the first 36 weeks of 2010 on 13 reporting U.S., Canadian, and Mexican railroads was up 9.9% from the 36 weeks of 2009, while intermodal notched a 15.1% increase.