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Seattle Area’s Light Rail Extension Project Moves Forward

July 29th, 2015

The Board of Directors of Sound Transit, Washington State’s Central Puget Sound Regional Transit Authority, has chosen the preferred alternative for a light rail extension to Kent/Des Moines and Federal Way. The extension to Federal Way will take place when funding is available. Project staff will now advance design, complete environmental review and evaluate potential modifications to alignment and station options.

“Identifying a preferred route gives us a clear path forward for bringing light rail to Federal Way,” said Dow Constantine, Sound Transit board chair and King County executive. “Now we can plan how to support jobs and housing near stations along the corridor through transit-oriented development.”

The route will extend along the west side of Interstate 5 and includes stations in Kent/Des Moines on the east side of SR 99, another in Federal Way at the Star Lake park-and-ride at South 272nd Street, and a third at the Federal Way Transit Center.

“This is a great day for South King County,” said Dave Upthegrove, Sound Transit board member and King County council member. “The more affordable option lets us bring more transit to more people – something badly needed in our diverse and low-income community.”

Project staff will study ways to optimize the Kent/Des Moines preferred station option between Highline College and 30th Avenue South to facilitate access to Highline College and will also evaluate re-aligning the preferred station option at the Federal Way Transit Center along 23rd Avenue South. This potential change would facilitate multimodal connections to the existing transit center, accommodate a future light rail extension south along I-5 or SR 99, and support the potential for future transit-oriented development downtown.

“We are making steady progress on getting light rail to Federal Way,” stated Sound Transit Board Member and King County Council Member Pete von Reichbauer. “Next steps in planning include optimizing design of the Federal Way Transit Center Station to enhance train and bus connections and encourage future transit-oriented development downtown.”

The agency plans to publish a Final Environmental Impact Statement (FEIS) in the fall of 2016, with the project selected by the end of next year. Final design is scheduled to begin in 2017 and construction in 2019, with service to Kent/Des Moines beginning in 2023. Sound transit’s Link Light Rail is expected to have an annual ridership of 80 million by 2030.

NS Second Quarter Net Income Decreases

July 29th, 2015

Norfolk Southern Corporation has reported $433 million in net income for the second quarter of 2015, down 23 percent compared to last year’s second quarter net income of $562 million. Diluted earnings per share decreased to $1.41 compared with $1.79 reported in the same quarter last year.

Norfolk Southern CEO James A. Squires said, “While we face short-term pressure, particularly as we clear fuel surcharge revenue and coal headwinds, Norfolk Southern is well positioned to continue improving service, which will reduce costs and add value to our customers.”

“Growth within the intermodal franchise, consumer spending, housing-related momentum and improved manufacturing activity all support an optimistic longer-term outlook,” continued Squires. “We have a strong legacy of success, and we are taking the right steps to continue value creation for our customers, the communities we serve, our employees, and our shareholders.”

Railway operating revenues for the second quarter were $2.7 billion, an 11 percent decrease compared with the 2014 second quarter, due to lower fuel surcharge revenue and coal volumes. Total volume dropped by 2 percent, or approximately 46,000 units, with gains in intermodal and merchandise traffic offset by losses in coal.

Railway operating expenses dropped 6 percent to $1.9 billion, primarily due to lower fuel costs. Income from railway operations was $814 million, a 20 percent decline compared with the second quarter of 2014. The operating ratio was 70 percent, compared with 66.5 percent for the 2014 second quarter.

General merchandise revenues totaled $1.6 billion, 5 percent lower than the same period last year. Volume grew by 1 percent, with strong growth in chemicals offsetting declines in steel. Increases were also seen in automotive and paper volume.

Intermodal revenues declined by 3 percent to $633 million for the quarter. Traffic volume was up by 2 percent due to growth in international business. Coal revenues were $453 million, 33 percent lower in the quarter compared to last year, and coal volumes decreased by 21 percent.

SEPTA Sees Record Ridership

July 29th, 2015

The Southeastern Pennsylvania Transportation Authority (SEPTA) has reported a record 37.4 million trips on Regional Rail in Fiscal Year (FY) 2015, an increase of more than 2 percent compared to FY 2014. Total annual trips on the system have increased by approximately 40 million since 2006. Regional Rail ridership has increased by more than 50 percent over the last 17 years, from 24.8 million in 1998 to 37.4 million last year.

“SEPTA is thrilled to continue to welcome new riders to the system,” stated Joseph M. Casey, SEPTA general manager. “We look forward to delivering further enhancements for our customers with long-needed capital improvements that are now underway.”

Overall, the Authority’s ridership of 330 million trips was approximately the same as the previous year, and is the fifth highest total in the last 25 years.

For FY 2015, SEPTA has also recorded its 16th consecutive year of operating with a balanced budget. The authority controlled costs by continuing its aggressive efforts to combat fraudulent lawsuits and other initiatives, such as a wayside storage program that utilizes regenerative braking on rail cars.

SEPTA also continues its “Rebuilding for the Future” program that is tackling a $5 billion backlog of state of good repair projects.

SEPTA’s FY 2015 ran from July 1, 2014 through June 30, 2015.

GATX Reports Second Quarter Results

July 28th, 2015

GATX Corporation has reported a net income of $45.4 million, or $1.03 per diluted share, for the 2015 second quarter, compared to last year’s second quarter net income of $53.1 million or $1.15 per diluted share.

For the first six months of 2015, net income was $107.6 million, or $2.42 per diluted share, compared to the same time period in 2014 that had a net income of $95.2 million, or $2.05 per diluted share.

“We continue to see strong demand for most railcar types in our fleet,” said GATX President and CEO Brian A. Kenney. “Utilization was 99.3 percent at the end of the quarter, excluding our boxcar fleet. The renewal rate change of our Lease Price Index was a positive 36.3 percent and our renewal success rate remained very high at 84 percent.”

“While renewal terms for many car types remained longer than historical averages, specific weakness in coal, coupled with regulatory uncertainty impacting cars in flammable service, resulted in shorter lease terms for these car types,” continued Kenney.  “As a result, the average renewal term for cars in our Lease Price Index was 54 months in the quarter. Remarketing income was lower versus prior quarters due to the timing of planned asset sales. We expect full year remarketing income to be in line with 2014.”

The Rail North America segment of GATX reported a profit of $84.9 million for the 2015 second quarter, compared to $91.7 million in 2014. The decrease in quarterly segment profit was primarily due to the timing of remarketing income.

For the first six months of 2015, Rail North America had a segment profit of $190.7 million, compared to $166.7 million for the first six months of 2014. The improvement in year-to-date segment profit was driven by increased lease revenue from higher lease rates as well as a six-month contribution from the acquired boxcar fleet compared to three months in the prior year.

Rail North America’s wholly owned fleet was approximately 125,600 cars as of June 30, 2015, including approximately 18,600 boxcars. Excluding the boxcar fleet, fleet utilization was 99.3 percent at the end of the second quarter, compared to 99.3 percent at the end of the prior quarter and 98.6 percent at the end of the second quarter 2014.

“The boxcar fleet, acquired in March 2014, is performing extremely well. Utilization on this fleet increased from 78.8 percent at acquisition to 97.3 percent at the end of the second quarter,” said Kenney. “The effects of the recently enacted flammable tank car regulatory changes on the industry will take some time to fully develop. However, with fewer than 1,400 tank cars requiring modification or retirement by 2023, we are well positioned to address these changes. Providing our customers with the safest railcars and service continues to be our highest priority, and we will diligently work with customers to comply with the new rule.”

Rail International’s second quarter segment profit was $19.1 million, compared to $19.4 million in 2014 second quarter. Segment profit has remained stable with higher lease revenue and lower maintenance activity at GATX Rail Europe (“GRE”) offset by the effects of a weaker Euro.

Trinity Posts Strong Second Quarter, Raises Annual Guidance

July 28th, 2015

Trinity Industries, Inc. reported results for the second quarter ending June 30, 2015, with a net income of $212 million, an increase of 29 percent over the 2014 second quarter. The company reported earnings per common diluted share of $1.33 compared to $1.01 in last year’s second quarter, an increase of 32 percent. Revenues for the quarter increased 13 percent to $1.68 billion when compared to the 2014 second quarter.

“Our performance continues to reflect the strength of our diversified industrial business model and our ability to shift our resources to meet our customers’ needs,” said Timothy R. Wallace, Trinity’s chairman, CEO, and president.

“I am extremely proud of the exceptional performance delivered by our people. Their consolidated efforts and proven ability to execute were major contributors to the high quality results we achieved during the second quarter,” added Wallace.

In the second quarter of 2015, the Rail Group reported revenues of approximately $1.11 billion, up by 24 percent over last year, and a record operating profit of $227.7 million, an increase of 29 percent. The increases in both revenues and profit were primarily due to higher deliveries, improved pricing and increased operating efficiencies partially offset by product mix changes.

The Rail Group shipped 8,530 railcars and received orders for 11,170 railcars during the second quarter. The Rail Group had a backlog of $6.90 billion as of June 30, 2015, representing 59,830 railcars, compared to a backlog of $6.81 billion as of March 31, 2015, representing 57,190 railcars.

The Railcar Leasing and Management Services Group reported record leasing and management revenues of $178.2 million for the 2015 second quarter compared to revenues of $160.7 million during the 2014 second quarter. The increase was due to higher average rental rates and net fleet additions.

Revenue from sales of railcars from the lease fleet owned for less than a year was $59.9 million for the second quarter compared to $70.8 million in the 2014 quarter.

Railcar operating profit for this group was $137.7 million in this year’s second quarter compared to operating profit of $102.4 million in 2014.

The Company anticipates 2015 full year earnings per common diluted share of between $4.45 and $4.75 compared to previously expected earnings per common diluted share of $4.10 to $4.45. The Company expects the level of earnings per share in the second half of the year to be relatively evenly split between the third and second quarters.

UP Earnings Decline in Second Quarter

July 28th, 2015

Union Pacific (UP) has reported its 2015 second quarter financial results with net income totaling $1.2 billion, or $1.38 per diluted share, compared to the 2014 second quarter’s $1.3 billion net income, or $1.43 per diluted share.

In the 2015 second quarter, business volumes, measured by total revenue carloads, dropped by 6 percent from the same quarter last year. Declines were seen in coal, industrial products and agricultural products in the quarter, which offset increases in automotive and intermodal. Volume in chemicals was flat compared to last year’s second quarter, and growth in base chemicals offset the decline in crude oil.

“Solid core pricing gains were not enough to overcome a significant decrease in demand,” said UP President and CEO Lance Fritz. “Total volumes in the second quarter were down 6 percent, led by a sharp decline in coal. Industrial products and agricultural products also posted significant volume decreases.”

“However, we made meaningful progress right sizing our resources to current volumes, and I am encouraged to report that we made these improvements while posting strong safety performance,” added Fritz.

Operating revenue declined by 10 percent to $5.4 billion compared to last year’s second quarter. Freight revenues dropped 10 percent, with volume decline, lower fuel surcharge revenue, and negative business mix more than offsetting core pricing gains. The company’s operating ratio of 64.1 percent declined by 0.6 points compared to the 2014 second quarter. The operating ratio benefited just under a point from lower fuel prices.

“While the volume outlook remains uncertain, we remain laser focused on operating safely and efficiently no matter what the market environment. We will continue to reduce costs and improve productivity as we further align resources with demand,” Fritz concluded. “Longer term, we continue to be optimistic about the strengths of our diverse rail franchise.”

CBTC to be Installed on NY Subway Line

July 27th, 2015

New York City’s Metropolitan Transportation Authority (MTA) has given preliminary approval to two contracts, worth a total of $205.8 million, for Siemens Industry Inc. and Thales Transport & Security to install a communications-based train control (CBTC) signaling system on the Queens Boulevard Line.

The Siemens contract is for approximately $156.2 million and the Thales contract is for $49.6 million. Siemens and Thales are the only two MTA-qualified vendors for CBTC projects.

CBTC continuously updates train positions, distances and travel speeds, allowing the subway system to recover quickly from delays and restore consistent wait times at subway stations. It also allows the MTA to operate trains closely together, which increases passenger capacity. The CBTC signaling system is currently in operation on the Canarsie “L” Line and is being installed on the Flushing “7” Line.

“The communications-based train control signaling system is a vital part of our plan to address issues of overcrowding, record ridership and service delays,” stated MTA Chairman and CEO Thomas F. Prendergast. “CBTC represents the MTA’s efforts to bring advanced technology to a century-old subway system that, in some parts, has not been updated in decades.”

“On the “L” Line where CBTC has been installed for several years now, we have seen improved service and we have been able to increase capacity significantly,” continued Prendergast. “Once we’re done installing CBTC on the “7” Line, those customers will also benefit from similarly improved and increased service, and the Queens Boulevard project is a continuation of our efforts to make those improvements system-wide.”

The Queens Boulevard Line (QBL) project calls for the signaling system of the entire Queens Boulevard Subway Line to be updated. The QBL West Phase 1 work, which includes four subway lines with multiple train overlays, is estimated to begin later in 2015, with the major installation work estimated to start in mid-2017.

The MTA also approved a separate $1.2 million contract for Mitsubishi Electric Power Products Inc. to develop and test CBTC software and systems with the aim of qualifying an additional supplier for future CBTC projects.

The full MTA Board will consider these contracts at a later date. Contracts will be fully funded by the MTA, with portions funded by the 2010-2014 Capital Program and other programs. Portions such as car and wayside equipment installation are scheduled to be funded in the 2015-2019 Capital Program.

FRA Says Railroads Must Continue Notifying States of Crude Oil Train Movement

July 27th, 2015

Railroads transporting crude oil have been alerted by the Federal Railroad Administration (FRA) that they must continue to notify State Emergency Response Commissions (SERCs) and Tribal Emergency Response Commissions (TERCs) of the expected movement of Bakken crude oil trains through their areas.

The May 2014 Emergency Order issued by the U.S. Department of Transportation DOT continues to require that trains with 1,000,000 gallons or more of Bakken crude oil – approximately 35 tank cars – are subject to the notification. In May of this year, the DOT announced that it would make the notification requirements of the Emergency Order permanent.

“Transparency is a critical piece of the federal government’s comprehensive approach to safety,” stated U.S. Transportation Secretary Anthony Foxx. “DOT is committed to making certain that states and local officials have the information they need to prepare for and respond to incidents involving hazardous materials, including crude oil. The Emergency Order that requires these notifications still stands, and we expect railroads to fully comply.”

The Emergency Order also directs railroads to include estimated volumes of crude oil, the frequency of anticipated train traffic, the route the crude oil will be transported and contact information for at least one individual at the host railroad.

“We strongly support transparency and public notification to the fullest extent possible,” said FRA Acting Administrator Sarah Feinberg who sent a letter notifying the railroads of DOT’s decision. “Railroads transporting crude oil must continue to provide the information required by the Emergency Order to SERCs and to update notifications in a timely manner.”

“FRA will continue with random spot checks and regular compliance audits to ensure that states, local communities, and first responders have the information necessary to respond to a possible accident,” added Feinberg. “FRA will take enforcement actions as necessary to ensure compliance.”

Hanson Names Durden VP & Senior Railway Principal

July 27th, 2015
Chris Durden

Chris Durden

The engineering firm of Hanson Professional Services Inc. has named Chris K. Durden, a former CSX executive, as vice president and senior railway principal. In his new position, Durden will provide technical assistance, input and assessments on railroad operations, and general guidance to Hanson staff on the planning, design and construction of intermodal and other railroad facility projects. He will be based in Hanson’s office in Jacksonville, Fla.

Durden has 38 years of experience in the rail industry, where he worked in various roles for general and rail contractors in the United States. Prior to his new position at Hanson, he served as assistant vice president of terminal development for CSX Intermodal Terminals Inc. in Jacksonville, where he was responsible for all phases of strategic planning, design, construction and maintenance in support of CSX’s 35 intermodal terminals.

Durden was responsible for leading the design and construction of award-winning projects, including the intermodal facility of Northwest Ohio Terminal, which won the American Railway Engineering and Maintenance-of-Way Association’s Dr. William W. Hay Award for Excellence in railway engineering. He was the first railroad intermodal representative to receive the John H. Chafee Environmental Excellence Award from the Association of American Railroads (AAR).

Durden earned a bachelor’s degree in business management from Jacksonville University.

Philadelphia Trolley Tunnel Undergoes Maintenance

July 24th, 2015

The Southeastern Pennsylvania Transportation Authority (SEPTA) will be closing Philadelphia’s Center City trolley tunnel from July 31 through August 17 for the Trolley Tunnel Blitz, a program in which work is done around-the-clock on power, track and station improvement projects. This is the third consecutive summer that SEPTA has held the program.

“The Center City tunnel is a five-mile, single loop track operation that is used 24-hours a day, making it difficult for our crews to get productive work windows,” stated SEPTA Deputy General Manager Jeff Knueppel. “Without the 16-day closure, we’d have months of nighttime and weekend shutdowns to complete all of the projects.”

This year, SEPTA’s in-house crews will replace approximately 7,500 feet of track on the westbound side of the tunnel, replace eastbound protection board, install additional LED lighting on the track around the 13th Street Station curve, and repair and clear track drains throughout the tunnel.

Numerous station repairs and improvements, including renewed stairs and platforms at 13th and 19th Street Stations will be made, and crews will continue to replace florescent lighting with high-efficiency LED lighting at all stations.

Maintenance work will include graffiti removal, tile repair, painting, drain clearing, heavy cleaning at all stations, and testing emergency generators and lighting throughout the tunnel.

The Trolley Tunnel Blitz is part of SEPTA’s “Rebuilding for the Future” capital program and funded through Pennsylvania Act 89.

“The Trolley Tunnel Blitz allows us to maximize productivity during improvements projects while minimizing the period of inconvenience to passengers and communities we serve, especially because we hold the Blitz when our ridership is at its lowest,” said Knueppel.

Trolley service on Routes 10, 11, 13, 34 and 36 will begin and end at 40th and Market Streets and will use alternate routing to connect to SEPTA’s Market-Frankford Line at 40th and Market Streets.