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FRA Issues Environmental Review for New BWI Rail Station

February 8th, 2016

The Federal Railroad Administration (FRA) has issued a Finding of No Significant Impact (FONSI) for the new Baltimore/Washington International Thurgood Marshall Airport (BWI) rail station. The completion of the environmental assessment and preliminary engineering allows the final design and construction to take place. Funding for final design and construction has not yet been identified.

The project will add a fourth track to nine miles of the Northeast Corridor surrounding BWI and will reconfigure the platforms to allow boarding from all four tracks. There are currently three tracks between the Grove Interlocking to the south and the Winans Interlocking to the north. The addition of a fourth track would increase rail capacity and reliability.

“The current rail station and infrastructure at BWI was built more than 30 years ago and does not support today’s needs or the region’s expected growth. The completion of the environmental review for this project brings BWI one step closer to a safer rail station, reduced rail congestion and increased reliability,” said U.S. Transportation Secretary Anthony Foxx.

Passenger rail service at the station is provided by Amtrak and Maryland Area Regional Commuter (MARC) trains. Both rail services have seen increased ridership by daily commuters and airline passengers. The station is Amtrak’s thirteenth busiest station in the country.

“A new BWI rail station will allow both airline and rail passengers to get to their destinations safely, reliably and efficiently,” said FRA Administrator Sarah Feinberg. “Today’s announcement is a significant step toward achieving that goal.”

Beyond Traffic, the U.S. Department of Transportation’s (USDOT) draft framework for the future, projects a population growth of 70 million more Americans over the next 30 years. The Northeast megaregion, which includes the area of Baltimore, is projected to add an additional 18.4 million people during this time, a 35.2 percent growth from 2010.

Timken Reports 2015 Full Year Results

February 8th, 2016

The Timken Company has reported financial results for the 2015 fourth quarter, with sales dropping by approximately 6 percent to $714.4 million compared to the fourth quarter of 2014. Excluding the impact of currency, sales were down just under 2 percent. This was primarily due to market-related declines in Process Industries, partially offset by sales from the recently acquired Carlisle belts product line.

The company reported a net loss from continuing operations of $35.7 million or $0.44 per basic share, versus a net income of $41.2 million or $0.46 per diluted share for the same time period last year.

Adjusted net income from continuing operations was $49 million or $0.59 per diluted share compared to the prior year’s fourth quarter results of $57.9 million or $0.65 per diluted share.

“Given the soft industrial environment globally, we were pleased with our fourth quarter results,” said Timken President and CEO Richard G. Kyle. “Demand declined slightly less than anticipated and our cost-reduction initiatives continued to gain momentum, resulting in a solid finish to a challenging year.”

For the 2015 full year, sales declined 7 percent to $2.9 billion. Excluding the impact of currency, sales declined almost 2 percent, primarily driven by weaker end-market demand across both Mobile and Process Industries, offset partially by the benefit of acquisitions. Net loss from continuing operations was $70.8 million or $0.84 per basic share, compared to the 2014 year net income of $146.8 million or $1.61 per diluted share.

Adjusted net income from for the 2015 full year was $189.1 million or $2.21 per diluted share compared with $232.9 million or $2.55 per diluted share in 2014.

“In 2015, we gained share in sectors like automotive, wind and rail, maintained double-digit operating margins, generated strong cash flow, acquired the Carlisle belts product line and made structural improvements to our cost-competitiveness and operating margins,” added Kyle. “We also continued to return capital to shareholders by increasing our dividend and buying back nearly 10 percent of our outstanding shares.”

“We enter 2016 with a lower backlog and a significant degree of market uncertainty. As such, we are planning for 2016 revenue to be lower than 2015, reflecting softer end-user demand across most of the industrial landscape and a continued strong U.S. dollar,” said Kyle. “Our strategic priorities remain the same: We will continue to focus on outgrowing our end markets through our DeltaX initiative, driving operational excellence with an emphasis on cost reductions and cash generation, as well as effective capital deployment to increase shareholder value.”

LIRR and Metro-North See Ridership Increases

February 8th, 2016

The Metropolitan Transportation Authority (MTA) has announced that ridership increased significantly on the Long Island Rail Road (LIRR) and Metro-North Railroad in 2015. Metro-North reported an all-time record ridership of 86.1 million customers, up 1.6 percent over 2014. The LIRR, which remained the busiest regional railroad in the nation, recorded its highest total since 1949, with 87.6 million customers, a 2.1 percent increase over 2014.

“When ridership set records back in 2008, many said it was because of high gasoline prices, and that certainly is one factor,” said MTA Chairman and CEO Thomas F. Prendergast. “But gas prices have sunk to low levels and the trend is continuing.”

The LIRR’s total breaks the modern record set in 2008, when the railroad carried 87.4 million customers. Metro-North’s total ridership has more than doubled since the railroad was founded in 1983.

“We are seeing the confluence a strengthening regional economy, healthier downtowns around the region, a new generation of millennials who values public transportation, and greater productivity on board our trains through the proliferation of smartphones, tablets and laptops,” continued Prendergast. “Customers are also responding to improvements we have made, including more frequent trains, improving on-time performance, a fleet of modern new electric cars, expanding availability of real-time information, and more channels for customer communication.”

Metro-North’s non-commutation ridership increased faster than its commuters, with non-commutation increasing 2.3 percent, while commutation increased 1 percent. Metro-North broke ridership records on all three of its main lines east of the Hudson River; the prior records had been set in 2008 on the Harlem Line and last year on the New Haven Line and Hudson Line.

“We spent 2015 working hard to improve Metro-North’s safety record, to restore confidence in Metro-North’s safety culture, and to rebuild our tracks,” said Joseph Giulietti, Metro-North president. “We’re delighted to see the increase in ridership because we think it indicates that our attention to safety and improved reliability are encouraging more customers to ride the train.”

The LIRR’s growth was seen in commuters, who increased 2.1 percent to 50.4 million, or by 1.04 million riders, and non-commuters, who increased 2 percent to 37.3 million, or by 734,000 riders.

“We’re pleased by the growth, but we’re more pleased be able to provide the best service we can provide and to be a valuable, useful service to more people,” said LIRR President Patrick Nowakowski. “Looking toward the future, we’re pleased that we’re poised to increase our value to the region further, and grow ridership accordingly, through increased reverse-peak service that would result years down the road from the Main Line Expansion program that Governor Cuomo announced this month.”

LIRR and Metro-North ridership is positioned for even further growth in the future due to investments included in the MTA’s 2015-19 Capital Program, funded through a record contribution from the State of New York. The program will fund the construction of four new Metro-North stations in the Bronx, the expansion of Metro-North’s New Haven Line to Penn Station, and a major expansion of the LIRR’s Main Line between Floral Park and Hicksville, and construction of new LIRR stations in Queens, Elmhurst and Sunnyside.

STB Implements Reauthorization Act

February 5th, 2016

Surface Transportation Board (STB) Chairman Daniel R. Elliott announced that the STB will be posting monthly status reports of its implementation of the STB Reauthorization Act of 2015, which was enacted into law on December 18, 2015.

The Reauthorization Act establishes the STB as a wholly independent federal agency, no longer administratively aligned with the U.S. Department of Transportation. The Act also expands the STB’s membership from three to five Board Members, and allows a majority of STB Board Members to meet in private to discuss agency matters.

Elliott announced that he intends to have the first of such Board Member meetings in U.S. Rail Service Issues—Performance Data Reporting. The Board will proceed with proposing to establish new regulations requiring the reporting of certain railroad service performance metrics on a permanent basis.

“Rail industry stakeholders have waited 20 years for the Board to be reauthorized,” remarked Elliott. “There is no doubt that freight rail transportation will benefit from the thoughtful provisions of this law. Behind this reauthorization is a message of transparency and increased efficiency. That is what I will deliver to the public.”

The STB now has authority to investigate issues of national or regional significance and is required to establish regulations governing such investigations. The Act directs the STB to modify its voluntary arbitration process, including increases in the maximum damage awards.

The Act also requires shortening of timelines in large rate case proceedings,including limits on the time allowed for discovery and the time allowed for development of the evidentiary record. The STB must also produce a report on rate case methodology and assess procedures used to expedite litigation in the courts.

Siemens Opening Sacramento Rail Services Plant

February 5th, 2016
Siemens Maintenance Services. Photo: courtesy of Siemens.

Siemens Maintenance Services. Photo: courtesy of Siemens.

Siemens will open a new 60,000 square-foot plant in Sacramento, Calif., which will be dedicated to its growing rail service, maintenance and repair operations. The facility will be the U.S. headquarters for Siemens Mobility Customer Services and the West Coast logistics hub. The company will begin operations at the new facility in early February.

“We’re thrilled to expand our already significant footprint in the Sacramento region with the opening of this new rail service facility,” said Chris Maynard, head of Customer Service for Siemens Mobility. “This expansion signals our dedication to servicing and modernizing rail systems across North America while continuing to deliver industry-leading manufacturing expertise, ensuring that our customers can continue to make the most of their rail systems.”

The new site, located in McClellan Park, will house the company’s rail refurbishment operations, rail bogie service center, accident repair, spare parts delivery, and administrative offices.

“We worked aggressively to assure that the facilities at McClellan Park could be redesigned and built to accommodate Siemens specialized requirements,” said Ken Giannotti, senior vice president of McClellan Business Park LLC. “We are looking forward to a long term relationship with the Siemens organization at McClellan Park.”

One of the first projects at the new facility will be a $21 million contract to modernize 32 SD160 light rail vehicles for Calgary Transit in Alberta. The project includes upgrading passenger information systems, improved wheel-set systems, updated flooring and seating, and modernizations to the operators’ cab interior and dash. The improvements will provide a similar look and feel to the 63 new S200 light rail vehicles for Calgary currently being manufactured by Siemens Rolling Stock in Sacramento.

The Customer Services business is also partnering with Sacramento Regional Transit (RT) to complete the refurbishment of 21 light rail vehicles for the RT system, adding approximately 15 years of additional life to the vehicles. Refurbished light rail vehicles are currently in operation on the Blue Line to Cosumnes River College extension.

The new rail service facility will complement Siemens existing rail manufacturing operations in Sacramento.

Metrolink’s First Tier 4 Locomotive Complete

February 5th, 2016
Metrolink's first Tier 4 locomotive. Photo: courtesy of Metrolink.

Metrolink's first Tier 4 locomotive. Photo: courtesy of Metrolink.

Metrolink, Southern California’s regional commuter rail service, has announced that its first Tier 4 locomotive is complete. The Electro-Motive Diesel (EMD) F125 locomotives, compliant with the latest U.S. Environmental Protection Agency Tier 4 emissions standards, are being produced at the EMD plant in Muncie, Ind. The first of the locomotives are expected to begin operating on Metrolink’s system in late 2016, with the remainder arriving in 2017.

The locomotives will reduce particulate matter and nitrogen oxide emissions by up to 85 percent and will have up to 57 percent more horsepower.

“On behalf of the Metrolink Board of Directors, we thank our state and federal legislative delegation, along with local community, business and environmental stakeholders for their leadership and support in this effort,” said Metrolink Board of Directors Chair Shawn Nelson, who is also an Orange County supervisor. “Upgrading our fleet with Tier 4 locomotives has taken a great deal of support and collaboration. We could not have done this alone and we look forward to full implementation of the entire 40 locomotive fleet.”

California State Senate President pro tempore Kevin de León stated, “Completion of Metrolink’s first Tier 4 locomotive is an important milestone in the effort to improve California’s air quality. The emissions reductions promised by these state-of-the-art locomotives will lead to cleaner air and a healthier environment for the people of Los Angeles and Southern California.”

Funding for the new locomotives was received through the South Coast Air Quality Management District’s (SCAQMD) Carl Moyer Program, which has provided Metrolink with $74.85 million in the last three years and is considering an additional $36 million in future requests.

Funding for the locomotives was also received from the State of California’s Transit and Intercity Rail Capital Program (TIRCP), which provided $41.2 million. The remaining budget will be accounted for through a combination of Metrolink member agency contributions and other subsidies.

“Transitioning to cleaner locomotives is vital to achieving our clean air goals for Southern California,” said SCAQMD Chairman William A. Burke, Ed.D. “We are pleased that Metrolink is participating in this transition which will benefit the health of the 17 million residents in our region.”

Metrolink became the first commuter rail agency in the country to purchase Tier 4 locomotives in 2013. The long-term Metrolink fleet plan calls for up to 40 new Tier 4 locomotives expected to cost approximately $280 million.

U.S. Rail Traffic Drops 7.3 Percent in January

February 4th, 2016

The Association of American Railroads (AAR) has reported that U.S. rail traffic for the month of January 2016 when compared with January 2015 was down 7.3 percent or 158,224 carloads and intermodal units. Total U.S. rail traffic for the month was 2,007,663 carloads and intermodal units.

January 2016 U.S. carload originations totaled 968,042, a drop of 16.6 percent, or 192,747 carloads, compared to January of last year. Excluding coal, carloads for the month were down 5.9 percent or 42,089 carloads compared to January 2015.

Intermodal traffic for January reached a total of 1,039,621 containers and trailers, up 34,523 units, or 3.4 percent, compared to last January.

Four of the 20 commodity categories tracked by the AAR each month saw increases last month compared with January of 2015. Commodities showing the largest increases included miscellaneous carloads, up 45.2 percent, or 7,409 carloads; motor vehicles and parts, up 3.9 percent, or 2,435 carloads; and chemicals, up 2.1 percent, or 2,615 carloads.

Coal showed the largest decrease in the commodity groups, with a drop of 33.3 percent, or 150,658 carloads, and petroleum and petroleum products were down 19.4 percent, or 12,037 carloads. Crushed stone, gravel, and sand declined by 10.3 percent, or 8,475 carloads.

“Intermodal was solid in January, but carload volumes weren’t what railroads were hoping for,” said AAR Senior Vice President of Policy and Economics John T. Gray. “By all accounts, rail service right now is excellent, but volume just isn’t there. At some point, the problems currently plaguing the energy and manufacturing sectors — low oil prices, a strong dollar, uncertainties in emerging ​markets — will sort themselves out. When that happens, railroads will be positioned to provide safe, reliable service.”

For the week ending January 30, 2016, a decrease of 6.5 percent was reported in total U.S. rail traffic compared with the same week in 2015. Carloads and intermodal units totaled 512,746.

For the week, there were 248,961 carloads, down 16.6 percent compared with the same week in 2015, while U.S. weekly intermodal volume was 263,785 containers and trailers, up 5.5 percent compared to 2015.

Three of the 10 carload commodity groups that are tracked by the AAR posted increases compared with the same week in 2015. Miscellaneous carloads had the highest increase, up 45.9 percent, with a total 10,019 carloads; followed by motor vehicles and parts, up 5.8 percent, with a total of 18,556 carloads; and chemicals, up 2.8 percent to 31,981 carloads.

Coal reported the largest decrease for the week compared to the same time period in 2015, with a total of 77,416 carloads, a drop of 33.8 percent. Petroleum and petroleum products were down by 24.9 percent to 11,626 carloads, and metallic ores and metals decreased by 19.1 percent to 19,826 carloads.

North American rail volume for the week ending January 30, 2016, on 13 reporting U.S., Canadian and Mexican railroads totaled 672,625 carloads and intermodal units, down 6.3 percent compared with the same week last year. Carloads totaled 335,717 for the week, a drop of 15 percent, and intermodal units totaled 336,908 units, an increase of 4.3 percent compared to last year.

North American rail volume for the first 4 weeks of 2016 was 2,630,780 carloads and intermodal units, down 6.8 percent compared with 2015.

Sound Transit Awards Contract for Expanded Layover Facility

February 4th, 2016

The Sound Transit Board of Directors has awarded a contract to Shimmick Construction to design and build a $13.2 million expansion of the agency’s Sounder layover facilities in Lakewood. The improvements will add a third track to the existing yard, allowing Sound Transit to store more Sounder train cars for its Lakewood-to-Seattle service as the agency prepares to add three round-trip trains to meet demand.

“Sounder commuter rail is more popular than ever,” said Sound Transit Board Chair and King County Executive Dow Constantine. “This fall we’re adding another weekday round trip between Lakewood, Tacoma, South King County and Seattle, and two more in 2017.”

The existing layover facility is at capacity and must be expanded to allow for storage of additional equipment. Nine new Sounder train cars will begin arriving late this fall. When complete in 2017, the expanded layover facility will have the capacity to store up to seven eight-car train sets. When additional Sounder service starts this fall, crews will operate seven seven-car trains. The third track will be finished by December to accommodate storage for new passenger cars being delivered in 2016 and 2017.

Other elements of the expansion include permanent office space and parking for crew members, and new fencing, guard booths and surveillance systems for added yard security. Enhanced wayside power, air, water, fire protection and upgraded yard lighting will reduce energy use and support night-time train cleaning.

Sounder ridership continues to experience double-digit growth. During the third quarter last year, average weekday ridership between Lakewood and Seattle increased 15 percent compared to the same period last year. Ten round-trip trains now operate on the south line. Two peak-service round-trip trains will roll out next year.

Kelso Renews M1003 Manufacturing Status

February 4th, 2016

Kelso Technologies Inc., a railway equipment supplier, has renewed its M1003 manufacturing status under the Association of American Railroads (AAR) policies and guidelines.

Earlier this year, the AAR conducted a full manufacturing audit of Kelso’s Bonham, Texas, facility in accordance with the M1003 regulations. No adverse findings were reported, and the lead auditor recommended continuation of the company’s M1003 approval.

“Kelso continues to achieve and maintain the highest standards of design engineering and production capabilities,” said Chief Executive Officer James R. Bond. “Our primary objectives are to surpass regulatory compliance guidelines in order to produce the “best available safety technology” products designed to better protect the lives of first responders and all in harms way.”

This audit, which is required by all tank car valve manufacturers, is required to maintain M1003 certification. Kelso’s M1003 system also has been audited by some key customers who have approved the company’s M1003 program as compliant with their own M1003 requirements.

“We are pleased that Kelso has maintained the highest production standards recognized by the industry. We remain optimistic that our product strategies and our abilities to produce them will eventually lead to enhanced financial performance when economic conditions improve,” added Bond.

Greenbrier Promotes Rittenbaum and Tekorius

February 3rd, 2016

The Greenbrier Companies, Inc. has promoted Mark J. Rittenbaum, chief financial officer, to the newly created position of executive vice president, commercial, leasing and finance. The company also promoted Lorie L. Tekorius, senior vice president and treasurer, to senior vice president, chief financial officer and treasurer. Rittenbaum and Tekorius will report to Chairman and Chief Executive Officer William A. Furman.

“Greenbrier is fortunate to have incredible depth of talent on its executive bench. I am pleased to recognize the many contributions made by Mark and Lorie and to increase their roles in senior management of Greenbrier,” said Furman. “I am proud of our entire management team and see these changes as an opportunity to put our seasoned executive expertise to even greater use in a fluctuating environment.”

Rittenbaum will now focus on commercial activities, with particular emphasis on new railcar sales, leasing and integration/enhancement of customer service design. Senior Commercial Officer William Glenn, Senior Commercial Officer Brian Comstock, and Greenbrier Leasing and Management Services President Jim Sharp will report to Rittenbaum.

“Greenbrier has built a tremendous ‘go to market strategy’ that serves its integrated business model and expanded world-wide activities. In the process, we have grown a very successful asset-light leasing and asset management business,” said Furman. “We continue to add value solutions for our customers and shareholders, as our business becomes larger and adjusts to a changing environment. It is time to further integrate our commercial and leasing functions to better serve our goals of cost-efficient growth and service to our customers.”

Rittenbaum will chair a newly created executive committee reporting to Furman. The committee will be responsible for helping to frame policy over a wide range of business, administrative, financial and strategic areas. In addition, it will be responsible for streamlining service design and achieving service and cost synergies across the company.

Executive Vice President and Chief Strategic Officer Victoria McManus and Senior Vice President, General Counsel and Chief Compliance Officer Martin Baker will be on the committee.

“The Executive Committee will free up a substantial portion of my time to focus more on longer term strategies for Greenbrier, and to operate the Company,” said Furman. “Global Manufacturing, the Wheels and Parts business, and GBW Railcar Services, a repair joint venture with Watco Companies, will continue to report to me.”

Tekorius has been employed by Greenbrier for more than 20 years, working in various financial capacities, most recently as senior vice president and treasurer since 2012. She began her career at Coopers & Lyrband. Tekorius is a Certified Public Accountant and earned a bachelor’s in accounting from Texas A&M University.

“Mark and Lorie have done an excellent job at the financial helm of Greenbrier and have worked closely together for years. I’m confident we will continue our solid financial footing, and be well positioned for growth and change,” said Furman.

“Lorie also has the discipline and Company knowledge to help review, manage and adjust our General and Administrative expense profile to appropriate levels during changing market environments. She has chaired our strategic and budget process for several years and will continue to work with Victoria McManus and me in that important function. Adrian Downes, Greenbrier’s Senior Vice President and Chief Accounting Officer, will report to Lorie. Adrian has done a great job with our IT, accounting and tax organization, and will continue to play a strong role on our senior management team,” concluded Furman.