Freight Forecasting

“In 2022, we anticipate the steady recovery in the North American railcar leasing market will continue,” GATX President and CEO Brian A. Kenney said during a Jan. 25 earnings announcement. “We expect market lease rates to increase above average expiring rates for railcars renewing during the year.”

GATX: ‘Steady’ Leasing Recovery to Continue in ’22

At GATX, Rail North America’s 2021 “outperformance was driven by improving market conditions,” President and CEO Brian A. Kenney said during the company’s fourth-quarter and full-year 2021 earnings announcement on Jan. 25; in addition to achieving “higher fleet utilization and a higher renewal success rate, we have now experienced six consecutive quarters of sequential increases in absolute lease rates,” he reported.

For CN, a Hat Trick

January 25, 2022, will be remembered as the day CN achieved, in hockey parlance, a hat trick (three successes of the same kind, especially consecutive ones within a limited period; i.e. a hockey player who scores three goals in the same game). The Class I appointed a new President and CEO—who spent nearly 30 years at rival Class I Canadian Pacific; entered into a “Resolution Agreement” with beneficial shareholder and 2021 antagonist hedge fund TCI; and posted fourth-quarter 2021 results it calls “outstanding.”

Cowen Insight: 4Q21 Rail Shipper Survey Says …

Rail shippers expect price increases of 4.5% over the next 6-12 months, up 30 bps sequentially and above both our survey’s 3.4% five-year average and long-term 10-year average of 3.6%. The business outlook declined slightly sequentially, and economic confidence ticked up sequentially, while still below the survey’s average. Shippers appear to be largely supportive of reciprocal switching ahead of the pending Surface Transportation Board hearings. We see results as net neutral for the group, and continue to favor Canadian Pacific.

“The Union Pacific team concluded its most profitable year ever in 2021,” UP Chairman, President and CEO Lance Fritz said during a Jan. 20 earnings announcement. “We produced double-digit fourth-quarter revenue growth by leveraging our great rail franchise to generate positive business mix and core pricing gains, despite ongoing global supply chain challenges that impacted volumes.”

UP’s Fritz: 2021 ‘Most Profitable Year Ever’ (UPDATED)

Union Pacific (UP) on Jan. 20 reported fourth-quarter 2021 results, including operating revenue of $5.733 billion, up 12% from the same period in 2020 and 10% from 2019. This was driven by “higher fuel surcharge revenue, a positive business mix, and core pricing gains,” which were partially offset by a 4% decrease in business volumes, as measured by total revenue carloads. The Class I railroad also posted results for full-year 2021, which Chairman, President and CEO Lance Fritz called the “most profitable year ever.”

2022 Railroaders of the Year: Keith Creel and Pat Ottensmeyer, ‘Transnational Team’

RAILWAY AGE, JANUARY 2022 ISSUE: The Railroader of the Year Award, our 59th annual, goes to two exemplary and visionary North American rail industry leaders: Canadian Pacific President and Chief Executive Officer Keith Creel, and Kansas City Southern President and Chief Executive Officer Patrick J. Ottensmeyer. The two are reconfiguring the North American rail landscape by completing, if all goes as planned, what will be the first Class I merger in more than 20 years, and creating North America’s first transnational freight railroad, Canadian Pacific Kansas City, or CPKC.

Week 1: Double-Digit Losses for U.S. Carloads, Intermodal

U.S. rail traffic for the week ending Jan. 8, 2022, came in at 440,761 carloads and intermodal units, dropping 16% from the same week last year, based on 210,020 carloads—down 10.6% from 2021—and intermodal volume of 230,741 containers and trailers—down 20.4%, the Association of American Railroads (AAR) reported on Jan. 12.