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The Greenbrier Companies, Inc. has reported a total of 15,000 railcar units, valued at $1.37 billion, in new orders were received in fourth quarter, which ended August 31, and through September 17. The orders include the June 2014 order for 2,700 railcar units valued at approximately $320 million.
The orders cover a broad range of railcar types, including tank cars, small cube covered hopper cars for sand and cement service, medium cube covered hopper cars for grain service, automotive carrying cars, and a recent award for 3,100 double-stack intermodal units.
From September 1, 2013, to September 17, 2014, Greenbrier has received orders for almost 39,000 railcars in North America and Europe valued at $3.72 billion. The average sales price of $95,000 reflects the diversity of railcar types ordered.
“These new orders demonstrate that our strategy to diversify our product mix, add efficient capacity in lower-cost facilities, and drive considerably more volume through our leasing and asset management model is paying off,” said Greenbrier Chairman and CEO William A. Furman. “Our comprehensive new railcar product portfolio of virtually all railcar types includes innovative new products such as our Multi-Max™ automotive carrying railcars, large cube covered hopper cars for transport of plastic pellets and other commodities, pressurized tank cars, and our next generation Tank Car of the Future. Our flexible manufacturing footprint and capital programs will allow us to double our tank car manufacturing capacity to over 7,000 tank cars per year, while preserving the capability to nimbly produce other railcar types.”
In addition, Greenbrier received a recent deck cargo barge order, which brings total marine backlog to $112 million and extends Greenbrier’s marine backlog to 2016.
“Our leasing business continues to emphasize the syndication of increased volumes of leased railcars to investors who have access to low-cost capital and who value Greenbrier’s full range of products and services over the life of the railcar,” added Furman. “At the same time, we have reduced our longer-term ownership in leased railcars, liberating nearly $100 million in capital and improving our ROIC.”
“We are particularly pleased by demand and strength in the intermodal market and Greenbrier’s award of 3,100 double stack units, reflecting 100% market share of orders recently placed. This award, along with our marine backlog, stabilizes production at our flagship Gunderson facility in Portland, Oregon,” said Furman.
According to Greenbrier, intermodal car loadings are up nearly 6% compared to the same period in 2013. Shipments of petroleum and petroleum products, including crude by rail, as well as shipments of frac sand have each grown year to date by approximately 12%, continuing to drive demand for tank cars and small cube covered hoppers. Year-over-year railcar loadings for grain are up approximately 15%, leading to nearly 100% utilization of the existing North American grain railcar fleet.
“Strong automotive, agricultural and energy markets, and a recovering intermodal market are generating robust and broadening demand,” stated Furman. “In particular, the importance of the energy renaissance in North America cannot be understated. It is rapidly reshaping our industries and strengthening the American economy. Greenbrier appreciates its opportunity to lead as a provider of safe, reliable and high quality transportation equipment that moves energy products to market over both rail and marine routes.”
Furman continued, “We anticipate that the U.S. Department of Transportation will issue its final rule on the safe movement of flammable liquids by rail before the end of 2014. A final rule will provide the clarity the industry needs to make investments that ensure that crude oil and other flammable commodities are classified properly and transported in tank cars that are safer at any speed. We continue to advocate for safety and champion a new design standard which includes a 9/16-inch thick steel shell, a feature of our Tank Car of the Future. Other safety features of our car include thicker steel, more robust top and bottom outlet protection and jacketed shells with ceramic insulation.”
“We are gratified to have received awards for 3,500 Tank Cars of the Future. These cars are eight times safer than legacy DOT-111 cars most widely used in oil and ethanol service today and two times safer than the current state-of-the-art CPC 1232 tank cars, as measured by Conditional Probability of Release (CPR). Greenbrier is also prepared to meet the need for tank car retrofits through GBW Railcar Services, our newly launched joint venture with Watco Companies for railcar repair and retrofitting. With 38 shops, 14 of which can perform tank car repairs, GBW has the largest independent shop network in North America,” concluded Furman.
The Chicago Transit Authority (CTA) Board has approved the complete overhaul of all 257 of the 3200-series railcars on the Brown and Orange lines. The unanimously approved $92 million contract will be used for the materials necessary to substantially renovate the rail cars, originally purchased in 1992-1993.
The overhauls will extend the life and improve the performance of the rail cars by replacing or rebuilding many of the cars’ major components, including wheel trucks, axles, motors and the propulsion and power systems. LED lighting will replace the current fluorescent lighting and doors and door motors will be replaced.
“These improvements to the 3200-series cars, combined with the new 5000-series cars we continue to introduce, will provide the CTA one of the most reliable rail fleets in years,” said CTA President Forrest Claypool. “When overhaul work is complete in 2017, our new and overhauled rail cars will comprise 70 percent of the CTA’s rail car fleet, providing our customers with an improved rail ride.”
Last year, the CTA approved contracts for other components of the 3200-series overhaul work, including the replacement of all auxiliary power supply units and all existing heating and cooling units. New, color LED destination signs were also installed, similar to those on the CTA’s newest generation of rail cars, the 5000-series.
The CTA will invest more than $166 million in the 3200-series fleet overhaul. The overhaul work will be performed in-house.
In addition to the new 5000-series rail cars and the 3200-series overhauls, the CTA is also planning for the next generation of rail cars, the 7000-series. The CTA will seek bids from manufacturers for those cars this year.
Genesee & Wyoming Inc. (G&W) saw a 10.5 percent increase in traffic volumes for August 2014 when compared to August of 2013. Total carloads were reported at 179,184, an increase over last year of 17,083 carloads.
Commodities that showed the largest growth this month when compared to August 2013 were led by agricultural products with a 24.9 percent increase over August 2013. Minerals & stone carloads increased by 19.6 percent, primarily due to increased shipments in G&W’s Ohio Valley, Northeast and Central regions. Coal & coke carloads were up 14.8 percent, primarily due to increased steam coal shipments in G&W’s Central and Ohio Valley regions.
G&W’s same-railroad traffic for August 2014, which does not include the Rapid City, Pierre & Eastern Railroad, Inc. acquisition that started operations on June 1 of this year, increased by 7.3 percent, or 11,912 carloads, when compared to last August, with 174,013 carloads reported.
North American same-railroad traffic for the month of August increased 12,894 carloads, or 9.1%, and Australian traffic decreased 982 carloads, or 4.8%.
For the 2014 third quarter, G&W reported an increase of 8.9 percent, or 29,197 carloads, compared with the third quarter of 2013 through August.
Commodities that showed the largest jump in the third quarter of 2014 compared to the same time period in 2013 were minerals and stone with a 21.6 percent increase, agricultural products with a 17.1 percent increase, and coal and coke with a 12.6 percent increase.
G&W’s same-railroad traffic in the third quarter of 2014 increased by 5.7 percent, or 18,654 carloads, when compared to the 2013 third quarter. Same-railroad traffic for the 2014 third quarter totaled 345,827 carloads.
The Association of American Railroads (AAR) is concerned that the Surface Transportation Board (STB) Reauthorization Bill (S.2777) would harm railroads’ ability to move what the economy demands and deliver the service shippers expect. The AAR also believes that, if allowed to proceed in its current form, the legislation would have a negative effect on the industry’s continued reinvestment of record amounts of private capital into the freight rail system. The bill is scheduled to be marked up in the Senate Commerce Committee today.
Edward R. Hamberger, AAR president and CEO, said railroads have several serious concerns with the bill, beginning with the legislation directing the STB to pursue regulations that could cap rates and require railroads to turn over traffic to competitors.
“The rail industry believes this legislation will harm the ability of the nation’s railroads to invest in the network and improve service for our shippers,” said Hamberger, noting that railroads are moving the most freight in the last seven years and that some commodities are up double digits over last year. “These new restrictive regulations would be imposed on the nation’s railroads at a time when investments in capacity, new equipment and new hires are needed.”
According to the AAR, several other sections of the STB Reauthorization Bill would also negatively impact the rail industry. These includes directing the STB to prevent railroads from using the common approach of railroads and shippers alike in contract negotiations to “bundle” offers, but allowing shippers to continue to do so. The AAR says the STB has no authority over rail contracts and should not be directed to interfere in agreements that are arms-length transactions freely entered into by both parties.
The AAR also believes that the STB already has broad regulatory oversight over the railroads. The legislation, however, would give the STB expanded authority to launch investigations of a railroad even where no complaint against the railroad has been lodged.
“On the one hand everyone wants to see capacity grow and traffic flow unimpeded, and on the other hand there are those that want to undercut our very ability to get the capital necessary to invest,” stated Hamberger. “This is a perfect example of you simply can’t have it both ways. America’s rail industry is urging policymakers not to rush this legislation and instead give all stakeholders the opportunity to have a more productive conversation to try to find common ground.”
Watco Companies has named Bob Billings vice president marketing and sales for the newly formed Great Lakes Region, overseeing the commercial activity of the Wisconsin & Southern (WSOR), Ann Arbor (AA), Grand Elk, and Pennsylvania Southwestern railroads. Andy Laurent was recently named regional vice president marketing and sales for WSOR and will report to Billings.
Billings, who has 20 years of railroad industry experience, joined Watco in January 2013 with the acquisition of the AA as the general manager. Since March 2014, he has led the commercial efforts of the AA, Grand Elk, and Pennsylvania Southwestern railroads as regional vice president marketing and sales of the northeast region.
He began his career with Norfolk Southern (NS) and moved to AA in 1998. Throughout his career, he has been promoted to positions of increasing responsibility within the operating and sales and marketing departments. Most recently preacquisition, he served as AA’s vice president operations/marketing and sales.
Prior to joining NS, Billings attended college, served in the United States Navy and held various sales and marketing positions within the financial services industry.
In his new role, Laurent will be responsible for overall performance of the WSOR as it relates to growth and expansion of Watco’s existing commercial and customer relationships. He will work with and lead the WSOR marketing team and partner with Watco commercial, operating, and support services teams to meet and exceed customer expectations in accordance Watco’s Customer First Foundation Principles.
Most recently, Laurent led the commercial efforts of the Chicago South Shore and South Bend Railroad as director of marketing and sales. He brings to WSOR knowledge of interline settlement, navigation throughout the Chicago gateway railroad environment, economic development, and management of complex freight and passenger rail relationships.
Laurent earned a bachelor’s degree in urban planning and development from Ball State University. He contributes his time to several causes, including youth leadership programs, economic development organizations, and business task forces.
The U.S. Department of Transportation (DOT) has awarded a $10.3 million Transportation Investment Generating Economic Recovery (TIGER) grant to the Bi-State Development Agency of the Missouri Illinois Metropolitan District (Metro) for transit enhancements in St. Louis’ Central Corridor.
The TIGER grant will be used to build a new MetroLink light rail station to be located at Boyle Avenue and Sarah Street in the Cortex District and to expand the light rail’s Central West End Station. Funds will also be used to create the first section of a bike trail that will connect the new MetroLink station to the regional Great Rivers Greenway trail network.
“The new project will be a great example of transit oriented development,” said John Nations, Bi-State Development Agency president & CEO. “The strength of our transit system allowed us to successfully compete and secure this very competitive federal funding. We look forward to the job creation and economic vitalization that will result from this partnership with Cortex, the City of St. Louis, and our other great partners.”
The project supports transit alternatives for the estimated 13,000 permanent jobs to be created in the Cortex area and throughout the Central St. Louis Corridor. ”We think the Cortex District has great promise for the future of the St. Louis region and we are proud to be part of making that vision a reality,” Nations said.
The total cost of the project is estimated at $12.9 million with local funding sources providing the remaining $2.6 million. The new MetroLink station is expected to be completed in 2017.
The NJ TRANSIT Board of Directors has announced new appointments in three executive positions. Neil S. Yellin has been named deputy executive director, Robert M. Lavell has been named vice president and general manager of NJ TRANSIT Rail Operations, and Dennis J. Martin has been named vice president and general manager of NJ TRANSIT Bus Operations, general manager NJ TRANSIT Mercer, Inc. and general manager NJ TRANSIT Morris, Inc.
Yellin has almost 35 years of experience in public sector leadership and 27 years of experience in the public transit industry. Since 2008, he served as senior vice president for administration/chief safety officer at the Long Island Rail Road (LIRR) where he developed a system of merged procurement and contracting initiatives, facilitated the migration of human resources and procurement systems from a legacy system to a technology platform, and developed an inventory management program that reduced inventory platforms.
Prior to his position at LIRR, Yellin served as president of MTA Long Island Bus and vice president of policy and planning for MTA Long Island Bus. He also held several key positions in New York City’s Human Resources Administration.
“Neil Yellin is a transportation veteran whose distinguished career includes executive experience in both rail and bus management, in his most recent position as Senior Vice President of Long Island Railroad, and previously having served as President for MTA Long Island Bus,” said NJ TRANSIT Executive Director Veronique “Ronnie” Hakim.
Lavell has more than 40 years of industry experience in operations, equipment, infrastructure and safety. He served as acting vice president and general manager of NJ TRANSIT Rail Operations since March 2014.
For the past 6 years, Lavell served as deputy general manager of equipment for NJ TRANSIT where he has provided leadership for all aspects of maintenance of equipment, including safety, budget and planning of rail facilities and equipment modifications. He established the agency’s first E-Learning program and implemented a component-based maintenance program that has increased reliability of NJ TRANSIT’s rolling stock by approximately 10 percent.
Lavell previously worked for 30 years with Amtrak, including serving as regional vice president of equipment maintenance.
Martin has 30 years of transit industry experience, specifically with NJ TRANSIT. He served as acting vice president and general manager of NJ TRANSIT Bus Operations since June 2014.
Martin served as senior director of NJ TRANSIT Customer Resources from 2003 to 2011, where he directed the development and implementation of corporate-wide customer service strategies and implemented a cloud-based customer relationship management system.
From 1998 to 2003, Martin served as director of terminal operations for NJ TRANSIT Bus Operations, where he directed bus operations within the Port Authority Bus Terminal. During his tenure as director of Terminal Operations, Martin led the evacuation coordination of New York City during the August 2003 regional blackout, established temporary operations at the Meadowlands Sports Complex and directed on-street boarding of customers during the Port Authority Bus Terminal shutdown.
“Both Robert Lavell and Dennis Martin, who have been acting in their current positions for several months, combined have more than 70 years of experience in the transportation industry,” added Hakim. “All three are committed to helping us achieve great success as we continue to provide quality public transportation for our customers and the communities we serve.”
The nationwide candidate search for the positions was conducted by Krauthamer & Associates, an executive search firm.
The National Industrial Transportation League (League) has announced its strong support of S. 2777, The Surface Transportation Board Reauthorization Act of 2014. This bipartisan legislation was introduced last week by Senators Jay Rockefeller (D-WV) and John Thune (R-SD).
“League members are gratified that Chairman Rockefeller and Ranking Member Thune have introduced an exceptionally well-crafted bill which, if enacted, will improve the operation and effectiveness of the Surface Transportation Board,” said League President and CEO Bruce Carlton. “Insuring that the STB has the resources it needs to carry out its statutory mandates is important to our members and rail shippers generally.”
“Senators Rockefeller and Thune have demonstrated the importance of a well functioning STB by proposing legislation that will expand Board membership and its authority to help ensure that our nation’s rail system operates effectively and efficiently for the benefit of both railroads and shippers,” continued Carlton. “This bill is a shining example of effective and appropriate Congressional oversight to give this important federal agency needed new tools and direction.”
The bill calls for the addition of two new members to the Board and also encourages the STB to move forward in a timely manner on the League’s proposed competitive switching rulemaking to improve the state of competition for captive shippers.
“By bringing this bipartisan proposal forward now the Commerce Committee’s leadership has demonstrated a unity of purpose which we admire. Moreover, they have managed to draft a bill that does not reregulate the rail industry but appropriately requires the STB to achieve more balance in its policies and determine the necessary degree of economic regulation for the freight rail industry. They certainly have the League’s support and respect for a job well done,” concluded Carlton.
The National Industrial Transportation League is the nation’s largest association of freight transportation professionals. Members include shippers and receivers of goods, carriers, brokers, third party intermediaries, logistics companies and other service providers.
TriMet, the provider of bus, light rail and commuter rail service in the Portland metro area, has reported that 33.5 million trips have been taken on the MAX Light Rail Green Line since it began service five years ago on September 12.
The 8.3-mile Green Line added a second alignment through downtown Portland along the Portland Transit Mall and new tracks between Gateway Transit Center and Clackamas Town Center, extending the MAX system to 52 miles.
“The ridership growth along the corridor clearly demonstrates that when we expand transportation options, riders can make more connections throughout the region,” said Neil McFarlane, TriMet general manager. “The Green Line was the first to serve Clackamas County, but in a year’s time, we’ll be adding our second MAX line into the county with the future Orange Line.”
The MAX Green Line saw a peak weekday ridership of 23,500 trips in spring 2012, a 25 percent increase from opening year weekday ridership. Trips on the line that began or ended within the I-205 segment increased 20 percent since service began, with total numbers reaching 3.52 million trips. The Green Line has also seen 7.6 million people traveling to or from the Clackamas Town Center.
The Association of American Railroads (AAR) has reported a 3.5 percent increase in total combined U.S. weekly rail traffic for the week ending September 6, 2014, when compared to the same week in 2013, with 525,144 carloads and intermodal units reported.
U.S. carloads, with a reported total of 286,002 for the week, increased 2.7 percent compared to the same week last year. U.S. intermodal volume increased 4.5 percent for the week, with a total of 239,142 units reported.
Nine of the 10 carload commodity groups that are tracked by AAR posted increases compared with the same week in 2013. Petroleum and petroleum products showed the highest increase, up 31.1 percent, with 15,657 carloads. Nonmetallic minerals increased 13.1 percent, with 37,500 carloads, and metallic ores and metals increased 8.5 percent, with a total of 25,541 carloads. Coal posted a decrease of 5.4 percent, with 111,406 carloads.
U.S. railroads reported a 4.5 percent increase in total combined traffic for the first 36 weeks of 2014 when compared to the same period in 2013, with a total volume of 19,661,824 carloads and intermodal units. U.S. carloads increased 3.6 percent, with a reported total of 10,418,394 carloads. U.S. intermodal volume, with a total of 9,243,430 units, increased 5.6 percent.
Canadian railroads reported an increase of 3.4 percent in carloads and an increase of 5.7 percent in intermodal units for the week ending September 6, 2014, when compared to the same week in 2013. Weekly 2014 totals were 80,312 carloads and 55,804 intermodal units.
For the first 36 weeks of 2014, Canadian railroads reported a cumulative volume of 2,847,984 carloads, an increase of 1.6 percent from last year, and 2,046,688 intermodal units, an increase of 7.1 percent from last year.
For the week ending September 6, 2014, Mexican railroads reported 14,531 carloads, a 0.2 percent drop in carloads when compared to the same week last year. Intermodal units saw a 26.3 percent increase, with 11,617 units reported.
For the first 36 weeks of 2014, cumulative carload volume on Mexican railroads increased 1.4 percent when compared to the same time period in 2013, with a reported 563,328 carloads. Intermodal units increased 4.5 percent, with 373,340 units reported.
On the 13 reporting U.S., Canadian and Mexican railroads, combined North American rail carload volume for the first 36 weeks of 2014 was 13,829,706 carloads, an increase of 3.1 percent compared with the same time period last year. Intermodal trailers and containers totaled 11,663,458 units, up 5.9 percent.