Archive for the ‘Featured Stories’ Category
Four More Cat-Powered Locomotives for Norfolk Southern
September 8th, 2010On Sept. 1, Progress Rail Services Corporation, a wholly-owned subsidiary of Caterpillar Inc., and Norfolk Southern (NS) announced an order for additional PR43C locomotives.
In 2008, Norfolk Southern and Progress Rail began a cooperative effort to develop an EPA Tier 2 compliant, high-horsepower locomotive. Since then, two PR43C prototype locomotives have been built and placed in service on the Norfolk Southern system for developmental and operational testing. With the testing of the first two prototypes coming to a close, Norfolk Southern has decided to order four additional PR43C locomotives, scheduled for delivery later this year.
The PR43C locomotives are remanufactured from reusable locomotive cores. They have a dual-engine configuration: the primary engine, a Caterpillar C-175 rated at 3,600 horsepower, and a secondary engine, a Caterpillar C-18 rated at 700 horsepower, work in tandem to power the locomotive, to provide a total of 4,300 horsepower.
“Progress Rail is extremely pleased to have had the opportunity to jointly develop this locomotive with Norfolk Southern,” said Billy Ainsworth, president and CEO of Progress Rail. “Progress Rail and our parent company, Caterpillar Inc., share Norfolk Southern’s passion for environmentally-friendly locomotives. This project is about maximizing fuel efficiency and reducing emissions, while taking a locomotive that was built 20-plus years ago and giving it another 20-plus years of life. Simply put, this is about building a sustainable locomotive.”
The four new PR43C locomotives will feature upgraded traction systems, control systems, and modernized cabs.
Union Pacific Unveils Prototype Convertible Vehicle Carrier
August 25th, 2010 
Union Pacific Railroad (UP) has unveiled its AutoFlex™ convertible multi-level rail car for transporting vehicles. The new 90′ rail car can be adjusted to accommodate bi-level or tri-level vehicle transport while using the same rack structure.
“Improving safety and efficiency create greater value for our customers,” said Julie Krehbiel, Union Pacific vice president and general manager - automotive. “With the AutoFlex™ convertible multi-level, we can more easily adjust to changes in consumer purchasing trends and keep our customers’ products moving. This is a newly engineered rail car, not a converted bi-level car, and our engineering group did an outstanding job in developing this new rail car.”
The AutoFlex™ is intended to allow the railroad to adjust quickly to differing vehicle loads. UP said it also incorporates an improved panel end-door structure, improved tie-down chock systems, and upgraded in-transit damage protection. The railroad has also eliminated exterior ladder access to the rail car roof and upper decks; the ladder is accessible only when the end doors are open.
“Results of our preliminary tests have been very promising in terms of vibration, stability and overall ride quality,” said Barry Kanuch, UP’s chief mechanical officer. “We are excited about the car’s performance so far.”
Union Pacific holds 15 patents related to the design and process that resulted in developing the rail car.
Modest Dip for Weekly Freight Rail Traffic
August 16th, 2010Rail traffic retreated slightly from the previous week’s highs in the week ending Aug. 7, 2010, the Association of American Railroads (AAR) has reported. U.S. railroads originated 284,507 carloads for the week, up 3.5% compared with the same week in 2009, but down 13% from the same week in 2008. This marked a decline from the 300,292 carloads originated in the week ending July 31.
Intermodal traffic dropped a bit as well, to a total of 231,208 trailers and containers (down from 232,895 trailers and containers in the week ending July 31). This total was up 18.6% from the same week in 2009, but down 1.2% compared with 2008. Compared with the same week in 2009, container volume increased 19.8% and trailer volume rose 12%. Compared with the same week in 2008, container volume increased 6.8% and trailer volume dropped 30.7%.
A majority of the carload commodity groups (16 of 19) increased from the comparable week in 2009; metallic ores, up 61.2%, and metals and metal products, up 37.8%, saw the most significant increases. All 19 commodity groups were below the corresponding 2008 levels, however.
Carload volume on Eastern railroads was up 3.2% from last year, but down 16.1% from 2008. In the West, carload volume was up 3.8% from last year but down 10.8% from two years ago.
Canadian railroads reported volume of 70,624 cars for the week, up 27.3% from last year, and 49,384 trailers or containers, up 29.7% from 2009. For the first 31 weeks of 2010, Canadian railroads reported cumulative volume of 2,238,453 carloads, up 21.2% from last year, and 1,430,229 trailers or containers, up 15.1% from last year.
Mexican railroads reported originated volume of 13,445 cars, up 19.8% from the same week last year, and 7,087 trailers or containers, up 18.6%. Cumulative volume on Mexican railroads for the first 31 weeks of 2010 was reported as 424,917 carloads, up 20.8% from last year; and 199,881 trailers or containers, up 32.2%.
Combined North American rail volume for the first 31 weeks of 2010 on 13 reporting U.S., Canadian and Mexican railroads totaled 11,409,148 carloads, up 10.1% from last year, and 8,180,163 trailers and containers, up 14.3% from last year.
For further details, consult the AAR’s weekly rail traffic charts.
Union Pacific and Denver’s RTD Sign Agreements on Property Purchase
August 5th, 2010On August 4, officials from Denver’s Regional Transportation District (RTD) and the Union Pacific Railroad (UP) held a signing ceremony to finalize agreements for RTD’s purchase of railroad property and the construction and relocation of UP facilities necessary for expansion of the FasTracks transit program. The signing ceremony was held at the law office of Jacobs Chase LLC in Denver, Colo.
The agreements, which total $78 million, will provide property needed to build FasTracks’ East Corridor (from Denver Union Station to Airport Boulevard), Gold Line (from Pecos Junction to Ralston Road), and West Corridor (relocation of UP’s Burnham Yard Lead to the south).
“It is great to celebrate yet another milestone for the FasTracks investment initiative,” said Phil Washington, RTD General Manager. “The agreement we came to with Union Pacific is a demonstration of how well agencies can work together to benefit the greater good.”
“Today marks the culmination of several years of diligent work by many,” said Tony Love, Union Pacific Railroad Assistant Vice President of Real Estate. “The end result of this hard work is an agreement with a focus on safety and customer service for both freight and commuter rail traffic.”
This is the second property transaction between RTD and UP for FasTracks. The first, which totaled $118 million to purchase the right-of-way to build the North Metro Corridor, occurred in 2009.
Washington Port Secures Funds for Rail Construction
August 2nd, 2010Washington’s Port of Grays Harbor is $4 million closer to its goal of more than $15 million for construction of additional rail storage tracks in the marine terminal complex. The Pacific Coast port is looking to create rail infrastructure to handle thousands of automobiles and nearly one million tons of U.S. agricultural products and liquid bulk cargoes.
The port said its officials have been working with both private and public partners to develop a rail system master plan to increase the port’s cargo-handling capacity. It estimates that increasing its rail capacity will generate additional export and import trade volumes projected to reach more than $1 billion in value by 2015.
U.S. Senator Patty Murray (D-Wash.) has announced the port will receive $2 million for the construction of auto terminal tracks to handle growing auto export cargoes, the port said. The improvements will also accommodate increased agricultural product exports.
In addition, the Washington State Community Economic Revitalization Board has awarded the port a $2 million, no-interest loan for Phase 1 of its planned rail improvements.
“Senator Murray’s announcement, and the commitment of the CERB financing, means we are on track to construct the additional rail needed to meet today’s demand and accommodate future cargo growth. This news has positive short-term and long-term impacts,” said Gary Nelson, executive director of the Port of Grays Harbor.
“Investing in rail capacity on Washington State’s Pacific Coast is the key to providing American shippers and producers with a direct route to our Pacific trading partners,” said Port of Grays Harbor Commission President Jack Thompson. “This project directly creates strong, marine related jobs in our community while improving our Nation’s position in the global marketplace.”
Last December, the Pasha Group, a diversified global transportation services and logistics company headquartered in Corte Madera, Calif., announced that Chrysler Group LLC had selected Pasha’s automotive facilities at the Port of Grays Harbor to support its exports of vehicles from the Pacific Northwest to destinations in Asia. Since January, Grays Harbor has processed and shipped more than 10,000 Chrysler automobiles to countries throughout the Pacific Rim.
Moreover, in March, soybean meal cooperative AG Processing Inc. announced expansion plans for its Grays Harbor operations. This summer the company began construction on a $60 million storage facility slated to open in 2012.
Foster Expects DOJ Ruling Shortly on Portec Deal
July 27th, 2010L.B. Foster Co. expects final word within two or three weeks from the Department of Justice (DOJ) as it completes its antitrust review of the company’s proposed acquisition of Portec Rail Products, Inc. And the rail supply company says that ruling may call for some type of deal restructuring for the proposed acquisition to gain federal antitrust clearance.
In an earnings conference call with analysts on July 27, company officials confirmed that they are working closely with DOJ and furnishing requested information. “With regard to the Portec acquisition, we were pleased to learn that the courts had lifted the preliminary injunction that had enjoined the completion of our tender offer,” said Stan Hasselbusch, president and CEO. “However, after working with the Antitrust Division of the Department of Justice, we believe that the DOJ will seek some type of restructuring solution to alleviate their concern that the acquisition, as proposed, would have an anti-competitive effect with respect to the insulated bonded rail joint product.”
In a deal announced Feb. 17, L.B. Foster and Portec, two Pittsburgh-based railroad suppliers, agreed to merge. The deal calls for L.B. Foster through a wholly owned acquisition subsidiary to make a cash tender offer to acquire all of Portec’s outstanding shares of common stock for $11.71 per share.
The companies targeted closing the transaction before the end of the second quarter, but the timetable was pushed back because of delays from court action and from DOJ seeking more information because of competitive concerns about the merged company’s rail joints business.
L.B. Foster is a leading manufacturer, fabricator and distributor of products and services for the rail, construction, energy, utility and recreation markets. Its railroad product line includes new rail products, relay rail, insulated rail joints, rail lubrication systems, rapid transit rail systems, and trackwork materials.
Portec manufactures and supplies a broad range of rail products, including rail anchors, rail spikes, railway friction management products and systems, rail joints, railway wayside data collection and data management systems, and freight car securement systems.
L.B. Foster said its second quarter 2010 net sales increased 20.3 percent to $119.5 million compared to $99.3 million in the prior year quarter. Its net income for the quarter increased by 125.8 percent to $6.0 million, compared to $2.7 million in the second quarter of 2009.
“Sales were up across all segments in the second quarter of 2010 and our backlog continued at a substantially higher level than it was a year ago. While business activity continues to be inconsistent, especially in the industrial markets, we continue to see a general strengthening in activity in most of our businesses,” Hasselbusch noted. “Bookings for the quarter were $120.6 million compared to $115.0 million last year, a 4.9-percent increase, and backlog was $207.2 million, up 41.1 percent from last year.”
For the six months ended June 30, 2010, L.B. Foster reported net income of $7.7 million compared to net income of $5.7 million for the same 2009 period.
Cash generated from operations was approximately $16.7 million for the first six months of 2010, compared to $10.8 million in 2009. Capital expenditures were $2.7 million compared to $2.3 million in the prior year, the company said.
“We continue to expect that in 2010 we will generate positive cash flow in excess of our capital expenditures and debt service. As we operate our businesses through 2010, we expect to be challenged by a difficult, highly competitive business environment and will review measures to win new sales opportunities, control costs and improve our operational processes while we continue to look for opportunities to leverage our strong balance sheet,” noted Hasselbusch. He added that the company has strong liquidity and available credit and will “continue to look for value through synergistic and accretive acquisitions.”
KCS Expects Near-Term Lifting of Service Embargoes
July 21st, 2010Kansas City Southern (KCS) (NYSE: KSU) on July 20 reported that its Mexican subsidiary, Kansas City Southern de Mexico, S.A. de C.V. (KCSM), expects that its Nuevo Laredo gateway will be reopened for service sometime this weekend if there are no new complications, with the Anahuac Bridge repairs underway and expected to be in service by then. The company anticipates taht all current service embargoes imposed on July 3 will be lifted early next week.
“I have just completed my third inspection of the area and am pleased to report that very significant progress has been made,” said David L. Starling, KCS president and chief operating officer from Mexico. “As a result, we anticipate, if there are no further unforeseen complications, the Anahuac Bridge will reopen sometime this weekend and that we can restore service to the KCSM Nuevo Laredo gateway at that time. As a result, we plan to lift all current service embargoes imposed on July 3 early next week.
Divers at the Anahuac Bridge inspected the bridge’s piers under the water line earlier this week. No pier damage was found; in addition, a missing beam was located that will be reused in the bridge repairs that are underway. Reopening of the Anahuac Bridge will allow the Nuevo Laredo gateway and the main line to Saltillo to reopen.
KCSM’s Matamoros to Monterrey “F” line is being used to divert some cross-border traffic, the company said. That line has reopened, and traffic is moving at reduced speeds. Ballast and large rock has been added to segments of that line washed out over the weekend, allowing restoration of service to this line on a restricted basis.
The “F” line was closed on Friday for 12 hours as local authorities in Reynosa prepared for flooding anticipated by the release of water from the nearby Falcon Dam upstream from Reynosa. On Saturday, July 17, the International Boundary and Water Commission had to open flood gates at the Falcon Dam, as the water level was at 128% of capacity. As a result, the Rio Bravo/Rio Grande and Salado rivers overflowed and washed out track at two locations near Reynosa on Sunday afternoon.
KCSM is continuing to monitor water levels in various areas around the “F” line but is hopeful that they will continue to recede over the coming days. Rain is however expected over the next couple days, so the situation remains uncertain at present.
The company posts service status updates on its website.
KCS Says Repairs Needed to Anahuac Bridge Approaches
July 15th, 2010Kansas City Southern (KCS) (NYSE:KSU) has reported that inspection of the Anahuac Bridge on the Kansas City Southern de Mexico, S.A. de C.V. (KCSM) line between Nuevo Laredo and Monterrey in Nuevo Leon revealed significant damage to the bridge’s approaches as a result of the recent flooding. The company thus expects that it will be a few weeks before service can be restored, without further complications.
In the interim, the Kansas City Southern Railway and KCSM are working with Union Pacific Railroad Company (UP) and Ferrocarril Mexicano, S.A. de C.V. (FXE), to reroute trains over the Brownsville/Matamoros and Eagle Pass crossings as capacity permits. KCS also said it is working with both Mexican and U.S. customs officials to extend service hours and streamline procedures at Brownsville and Matamoros to expedite rerouted traffic over this gateway
“As the water receded below the track level, we were able to determine more clearly the extent of the damage done to the Anahuac Bridge approaches by the surge of debris,” said David Starling, KCS president and chief operating officer. “I have just returned from a personal inspection of the bridge and damage done resulting from Hurricane Alex. We believe it will be a matter of a few weeks before we can make the bridge operational again if there are no further complications. We have Mexican and U.S. personnel on site and have deployed reconstruction resources with more on the way. Reopening of the KCSM Nuevo Laredo-Monterrey mainline is our highest company priority and we are deploying our resources accordingly.”
The hurricane caused significant track damage around the Monterrey and Saltillo areas as well as on the lines to Nuevo Laredo and Matamoros. KCSM issued freight embargoes at the U.S. - Mexico border and into Monterrey on Saturday, July 3, and these remain in effect while the damage is repaired.
KCSM is gradually restoring service. It is running trains over most of its Mexican network, including Brownsville/Matamoros to Monterrey and Monterrey south to Saltillo, San Luis Potosi, Mexico City, and the Port of Lazaro Cardenas. KCSM continues to operate service schedules in the following lanes:
- Lazaro Cardenas to/from Toluca and Mexico City;
- Mexico City to/from Veracruz;
- San Luis Potosi to/from Tampico; and
- Mexico City to/from Queretaro.
The company posts service status updates on its website.
RailAmerica Diversifies with Purchase of Atlas Railroad Construction
July 1st, 2010RailAmerica, operator of 40 short line and regional railroads in North America, is branching out into the railroad contracting market by acquiring Atlas Railroad Construction Co. and related assets for $21.5 million in cash plus about $2.5 million in closing adjustments for working capital. The transaction was expected to close on July 1.
Atlas is a western Pennsylvania-based railroad engineering, construction, maintenance and repair company operating primarily in the U.S. Midwest and Northeast. It provides railroad construction services to public transit agencies, industrial customers, and short line and regional railroads.
“We expect the next several years to see a dramatic increase in spending on railroad infrastructure driven by government stimulus programs and increased investments by North American railroads upgrading and improving their rail lines. Acquiring Atlas, a quality company with established relationships in the transit and freight rail sectors, positions RailAmerica to benefit directly from this spending,” said RailAmerica President and CEO John Giles.
In its first earnings conference call after RailAmerica went public last year, company executives said that they were fully engaged in scouting potential acquisitions of railroads and rail-affiliated companies and were encouraged by the opportunities they were seeing.
“We believe that RailAmerica will create new opportunities for Atlas to grow its business by expanding into regions where RailAmerica’s railroads already have a presence and by providing new services. We also expect to realize cost savings from this combination by leveraging the best practices of each organization,” Giles said. “With this transaction, we have started to implement our acquisition strategy, a key corporate priority that complements our organic growth. We continue to work to identify additional value-creating opportunities.”
For the next twelve months, RailAmerica estimates Atlas will generate approximately $25 million in revenue, $3.5 million in operating income and $2.1 million in depreciation and amortization. RailAmerica intends to use cash on hand to finance the purchase.
“I am pleased and proud for Atlas to join the RailAmerica family,” said Bill Stout, president of Atlas. RailAmerica expects to retain the Atlas brand and keep the headquarters in western Pennsylvania.
Starling Succeeds Haverty as CEO of Kansas City Southern
June 29th, 2010
On June 28, Kansas City Southern (KCS) (NYSE: KSU) announced that the KCS board of directors had elected Michael R. Haverty, who is currently chairman and chief executive officer, to the position of executive chairman, and had elected current president and chief operating officer David L. Starling as president and chief executive officer, both effective August 1, 2010.
The company said Haverty will continue to concentrate on the strategic direction of the company and oversee long-term business decisions. Starling will report to Haverty and focus on execution of the company’s long-range plan, with responsibility for oversight and management of all facets of the company’s operations, as well as those of its subsidiaries and affiliates.
Haverty noted that the succession had been planned when Starling first came to KCS two years ago.
“Dave came to Kansas City in July 2008 as president and chief operating officer of KCS with the thought in mind that he could succeed me as CEO. After two years, we are ready. David is a great team leader, and I truly believe we have the best management team, both north and south of the border, that we have had in the 15 years I have been associated with KCS.”
Prior to joining KCS, Starling served as president and director general of the Panama Canal Railway Company, which is jointly owned by KCS and Panama Holdings, LLC, of Hazelcrest, Ill, beginning in 1999.
“When Dave Starling assumed the position of president and director general of PCRC (Panama Canal Railway Company, a KCS affiliate) in June 1999, he began a reporting relationship to me as co-chairman of PCRC,” said Mr. Haverty. “In July 2007, we engaged him as executive representative of KCS, in addition to his position at PCRC, so that he could work with ocean carriers calling on the Port of Lazaro Cardenas in Mexico, as well as the Port of Balboa in Panama. This gave Dave exposure to our intermodal network in Mexico.”
Starling went to work for the St. Louis-San Francisco Railroad in 1971 and over the next 14 years held various positions in rail operations at that railroad and the Burlington Northern after the Frisco was merged into BN. He joined Mi-Jack Products in 1984 to help create a terminal operating company (ITS) and was later named vice president. In 1988, he moved to American President Lines (APL) as managing director of stack train operations in Chicago, then Atlanta, which included responsibility for Mexico. He was made managing director for APL’s Philippines operations in 1993 and managing director for Hong Kong/South China in 1994, and was promoted to vice president for Central Asia responsible for China, Taiwan, and Hong Kong in 1997.
“I am thrilled to have the opportunity to become CEO of KCS at a time that many positive things are happening with the company,” Starling said. “The past two years have been challenging, but also fulfilling as we weathered a deep recession and are coming out of it even stronger. The Kansas City Southern Railway Company and Kansas City Southern de Mexico are working closer together than ever and our cross border business now accounts for a quarter of KCS’ total revenue.”
Content Sections
More Headlines
- Four More Cat-Powered Locomotives for Norfolk Southern
- Union Pacific Unveils Prototype Convertible Vehicle Carrier
- Modest Dip for Weekly Freight Rail Traffic
- Union Pacific and Denver’s RTD Sign Agreements on Property Purchase
- Washington Port Secures Funds for Rail Construction
- Foster Expects DOJ Ruling Shortly on Portec Deal
- KCS Expects Near-Term Lifting of Service Embargoes
- KCS Says Repairs Needed to Anahuac Bridge Approaches
- RailAmerica Diversifies with Purchase of Atlas Railroad Construction
- Starling Succeeds Haverty as CEO of Kansas City Southern
- Rail Intermodal Volume Reaches New High for the Year, But Carloads Slip
- Freight Railroad Traffic Continues To Post Gains, AAR Reports
- Bombardier To Build Light Rail Vehicles for Metrolinx
- GWI To Buy Australia’s FreightLink
- Railroad Museum of Pennsylvania Gets $5 Million
RSS Feed
Railresource Articles
Category Feeds
Updates for Featured Stories