RBMN: Growth in the Time of COVID

RBMN Owner and CEO Andy Muller, Jr.

In the midst of a COVID-19-driven substantial economic slowdown that impacted North American 2020 freight rail traffic, Class II Reading & Northern Railroad (RBMN)—Railway Age’s four-time Regional Railroad of the Year (2002, 2011, 2015, 2020)—posted another banner year, breaking previous records for carloadings and freight revenue.

“Although rail traffic in North America fell 7.4% and our principal connection, Norfolk Southern, had an 11.9% drop-off, we managed a slight increase in carloadings, ending the year hauling more than 34,000 carloads,” RBMN reported. “Revenues were also up almost 4% The increase in revenues resulted in shifts in traffic mix and increasing tonnage moved in our coal car fleet.

“Our coal business increased as measured in tonnage moved and revenues. Although our export business was down in part due to foreign exchange rates, which made Russian anthracite cheaper, our strategy of developing rail/truck facilities throughout the Midwest and southeast to handle anthracite for steel mills led to increased business. We expect that business to increase significantly in 2021 as additional steel-making capacity comes on line.”

Another area of growth was RBMN’s transloading and warehouse business. “2020 brought with it a demand for warehousing raw materials, as a result of the COVID-19 pandemic,” RBMN noted. “This resulted in a 54% increase in carloads moving to our owned and operated Ransom warehouse. 2020 was also the first full year of operation for our steel coil transload at West Hazleton, where our customer has been able to streamline its supply chain while taking nearly 700 trucks off the highways.”

RBMN added that two “significant industrial development projects were completed in 2020. Iris USA is now up and running in the Humboldt Industrial Park, and Crossroads Beverage outside of Reading began new rail service last June. Both are expected to continue ramping up production and their inbound plastics by rail over the course of 2021. We are currently working with other prospects to begin construction on plants that will need rail service in years to come.”

RBMN shut down its passenger train service during the height of the pandemic, but resumed it June 27 with COVID-19 protocols. “We added more cars to our trains so people could social distance, and canceled all full-day train rides and focused on operations from Jim Thorpe (Pa.)” the railroad said. “Even with these restrictions and with the cancelation of the Fall Foliage festival in Jim Thorpe, we had an excellent year. More than 91,000 people came out to ride our trains, which continued into the Christmas season. We’re hopeful that we will be able to proceed with a full slate of passenger offerings in 2021.”

RBMN noted the “hard work and dedication” of its nearly 300 employees responsible for “year after year growth As we grow, we continues to add and promote its employees. In 2020 R&N continue to add people to our ranks to help manage the freight business,” including new VP Transportation Eric Peters, a former Norfolk Southern Harrisburg Division Superintendent, and a VP Coal Marketing, who came from the local anthracite industry.

In addition to investing in its employees, R&N also heavily invested in capital assets in 2020. Under the direction of owner/CEO Andy Muller, Jr., RBMN purchased 143 railcars for anthracite coal service, 17 locomotives from NS, a welded rail train and more than 34,000 ties. RBMN also completed its investment in its Nesquehoning Bridge project, which opened for business Feb. 4. R&N invested more than $4 million of its own capital to build this “critical link in the Northeastern rail system.” The bridge project was among the reasons Railway Age selected RBMN as 2020 Regional of the Year.

“2020 was a difficult year for many,” said Andy Muller, Jr. “I am proud of the way the men and women of Reading & Northern responded to the situation. We stayed focused on serving our customers. And we stayed focused on keeping ourselves and our co-workers safe. As a result, we were able to remain open throughout the pandemic. We were able to not only survive, but to thrive. We handled more cars and earned more revenue, all while staying safe. I am committed to our employees and our communities, and I will continue to invest money into the railroad so we can continue to grow for years to come.” 

Reading & Northern Railroad, with its corporate headquarters in Port Clinton, Pa., is a privately held railroad company serving more than 70 customers in nine eastern Pennsylvania counties (Berks, Bradford, Carbon, Columbia, Lackawanna, Luzerne, Northumberland, Schuylkill and Wyoming). It has expanded its operations over the past 30-plus years and now handles more than 34,000 carloads of freight and 91,000 excursion train riders over 400 miles of track. RBMN operates freight services and steam and diesel-powered excursion passenger services, owns almost 1,300 freight cars, and employs nearly 300.