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CSX’s Eliasson Reaffirms Earnings Guidance

June 5th, 2015

CSX Chief Financial Officer Fredrik Eliasson reaffirmed the company’s second quarter and full-year 2015 earnings expectations at the Deutsche Bank Global Industrials & Basic Material Conference that was held in Chicago this week.

CSX continues to expect earnings per share growth in the mid-to-high single digit range and meaningful margin expansion for 2015, as it progresses toward a mid-60s operating ratio longer-term.

“While overall volume is tracking slightly below the levels in the second quarter of last year, service is improving steadily and we remain on track to deliver second quarter earnings per share that are flat to slightly up,” Eliasson said. “Delivering excellent service continues to underpin CSX’s ability to create strong shareholder value by pricing above inflation, driving ever more efficient operations, and growing merchandise and intermodal businesses faster than the economy.”

Eliasson pointed to the decade of strong growth CSX experienced with expanded margins of more than 1,600 basis points and an average annual growth in earnings per share of 20 percent despite a significant decline in the company’s coal business.

The second quarter has seen improvements in on-time originations and arrivals, dwell time and velocity, with more improvements expected in the second half of the year. Key service measures continue to improve in the quarter, as resources come on line in critical areas of the network.

Intermodal traffic remains the company’s main growth market and, along with the construction sector, is producing volume growth quarter-to-date. Full-year domestic coal volume is expected to drop at least five percent due to low natural gas prices, and export coal volumes are expected to decline to 30 million tons for the year as the stronger U.S. dollar and overseas commodity prices reduce global demand for U.S. coal.

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CN Invests C$20 Million on Cold Supply Chain

June 5th, 2015
CN in Chicago, Illinois. Photo: courtesy of CN.

CN in Chicago, Illinois. Photo: courtesy of CN.

Canadian National Railway (CN) is investing C$20 million in the expansion of its cold supply chain capacity. The company is acquiring 200 more domestic, 53-foot temperature-controlled containers for use in North America and 32 electrical generators to move 40-foot international marine reefers. The power packs allow up to 17 international marine reefers to be connected at one time and will be used to move reefers from CN-served ports.

“CN was the first railway to introduce highway-to-rail conversion of reefer service in transborder markets,” stated JJ Ruest, CN’s executive vice president and chief marketing officer. “Our high-quality cold supply chain service has been embraced by the marketplace. We are now adding capacity to grow and help Canada’s food processing industry gain and maintain access to new domestic and international markets.”

“CN’s cold supply chain service offers the food industry a quality and cost-effective alternative to highway trucks and gives producers pursuing overseas opportunity a great tool to expand market share,” continued Ruest. “CN is growing with its customers, aiming to help them compete more effectively in their own markets.”

Barry Sutton, Maple Leaf Foods’ vice president international sales, said, “CN shares our food safety vision. Through collaboration, CN has created a robust supply chain backed by high food safety standards. CN’s transportation leadership and expertise give us peace of mind knowing that our products will make it to our customers nationally and internationally, safely and on time.”

The CN cold supply chain offers remote monitoring of interior container temperatures, a dedicated reefer desk team and superior exception management services.

“McCain Foods is pleased with the CN announcement. Adding more capacity addresses a critical supply chain need and helps meet our goals in providing quality products to our customers in an efficient and environmentally friendly manner,” said Allan Walker, director, Canada and export customer service and logistics for McCain Foods (Canada).

CN, in collaboration with other railroads, offers cold supply chain rail services between Canada-United States-Mexico, as well as between Canada and overseas markets.

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Belgian Transport Agency Orders 40 Additional Bombardier FLEXITY 2 Trams

June 5th, 2015
BOMBARDIER FLEXITY 2 trams ordered by Belgian operator De Lijn. Photo: courtesy of Bombardier.

BOMBARDIER FLEXITY 2 trams ordered by Belgian operator De Lijn. Photo: courtesy of Bombardier.

Flemish transport operator De Lijn has exercised an option in a 2012 contract with Bombardier Transportation for an order of 40 additional BOMBARDIER FLEXITY 2 trams for the cities of Ghent and Antwerp. The order, worth approximately US$107 million, increases De Lijn’s fleet of FLEXITY 2 trams from 48 to 88.

The new trams, which can carry up to 40 percent more passengers than the older cars, will be used to replace an aging fleet, and feature low-floors, multi-purpose areas for reduced mobility passengers and storage space for bicycles.

“We are happy to be able to provide these two Flemish cities with a much-needed capacity increase with this order,” said De Lijn’s General Director Roger Kesteloot. “The initial reaction to “Albatros”– the name that our passengers chose for the FLEXITY 2 trams – in Ghent has been very positive. We are looking forward with anticipation to the deliveries of the 40 additional trams.”

The 2.3 meter wide trams are equipped with BOMBARDIER FLEXX Urban 3000 meter gauge bogies with conventional axles to reduce wear on both wheels and tracks, and full suspension motors and gearboxes to reduce ground vibrations to a minimum. The vehicles have the BOMBARDIER MITRAC propulsion system, and heating, ventilation and air conditioning (HVAC) systems for drivers and passengers.

Ghent will receive 16 bi-directional, seven-module vehicles that are approximately 43 meters long and able to accommodate up to 378 passengers. Antwerp will receive 24 mono-directional trams. Of these, 14 will be seven-module vehicles with an approximate length of 43 meters and a capacity for 380 passengers and 10 will have five-module vehicles with an approximate length of 31 meters and a capacity for up to 266 passengers.

Bombardier has a long-standing partnership with De Lijn to deliver new trams and supply structural revisions, refurbishment and crash repairs on De Lijn’s existing fleet. Bombardier is also a partner in the EVTecLab field trial project where De Lijn will operate three electric buses equipped with BOMBARDIER PRIMOVE technology for inductive charging in the city of Bruges.

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PTC Focus of Testimony at House Committee Hearing on Oversight of Amtrak Derailment

June 4th, 2015

In written testimony to the U.S. House Committee on Transportation and Infrastructure,  Amtrak President & CEO Joe Boardman said that Positive Train Control (PTC) on Amtrak’s Northeast Corridor (NEC) is scheduled to be operational by the federal deadline of December 31, 2015.

“Safety must continue to be our highest priority,” he stated to the committee in charge of oversight into the Amtrak accident in Philadelphia last month. He noted that PTC is installed on the NEC line and currently is in operation from New Haven, Conn., to Boston, and at points between Washington, D.C., and New York where trains exceed 125mph.

Boardman noted that, prior to last month’s train derailment, Amtrak’s NEC has not had a passenger fatality caused by a derailment or accident in 28 years. “In no other place is a comparable volume of traffic moved with such a solid record,” he said in his testimony. “In addition to a thorough training, oversight and coaching system for our crews, we have a layered signal system that provides trains with multiple levels of protection.”

Federal Railroad Administration (FRA) Acting Administrator Sarah Feinberg, also spoke to the committee, stating that Amtrak has complied with the directives that the FRA has issued to date and that the FRA will ensure that Amtrak fully implements those directives.

Feinberg said that the FRA is currently working on directives for other passenger railroads that may have similar curve and speed issues and plans to release additional information about that work soon.

She noted that, although the cause of this accident has not been officially determined, that speed was a significant factor and that human factors, such as speed, remain the leading cause of all rail accidents. She stated that the FRA is preparing a package of actions aimed at addressing human factors such as speed, distraction and training. The actions may include additional emergency orders, safety advisories, fast-track rulemakings, agreements, or other initiatives.

“The reality is, if we believe that the cause of this incident was speed, it would have been prevented by Positive Train Control,” continued Feinberg. “As this committee is well aware, PTC is the single most important railroad safety technological development in more than a century, and it is absolutely necessary to ensuring the kind of safety that we expect on our rail system.”

“Importantly, we have also urged, year after year, for more funding to be directed at commuter railroads and at Amtrak to implement Positive Train Control,” said Feinberg. “For the past two years, as part of the GROW AMERICA Act – FRA has requested $825 million to assist commuter railroads with the implementation of PTC, as well as additional funding to aid with Amtrak’s implementation of PTC.”

“GROW AMERICA also proposed that FRA be granted authority to review, approve, and certify PTC Safety Plans on a railroad-by-railroad basis,” added Feinberg. “FRA asked for this authority in order to ensure that railroads would be forced to work with safety regulators to take other or equivalent actions to raise the bar on safety even prior to full PTC implementation. We believe it is important that even those railroads that fail to meet the congressionally-mandated deadline be required to improve safety in the interim.”

She added that despite the challenges facing full implementation of PTC, on January 1, 2016, the FRA will be prepared to take necessary enforcement actions against railroad that have failed to meet the deadline mandated by Congress.

Association of American Railroads (AAR) President and CEO Edward R. Hamberger also talked of the importance of PTC during testimony before the committee.

“America’s freight rail industry remains fully committed to Positive Train Control and is working all out to have a fully interoperable, nationwide PTC system tested and safely operating, from coast to coast on more than 60,000 miles of track,” Hamberger stated. “While the freight rail industry has spent more than $5.2 billion on PTC and progress has been substantial, much remains to be done before this new system, which has been an unprecedented technical and operational challenge, is installed, tested and fully operational across the U.S.”

In order to implement PTC, Hamberger pointed out that freight railroads have retained more than 2,400 signal system personnel and are in the process of training up to 100,000 employees on using the new system. Freight railroads have also deployed 50 percent of the 34,000 required wayside units and have replaced more than half the required signals and mapped most of the track that will be equipped with PTC.

He also commended Boardman for reinforcing Amtrak’s firm commitment to safety. “Amtrak and freight railroads in this country share the same 24-7 focus on safe train operations and together are working to advance safety in all aspects of rail transportation in the United States,” said Hamberger. “There is no greater priority than safety for the nation’s railroads and the terrible tragedy that is the focus of this hearing is a stark reminder that we must continually work to make our systems even safer.”

“The freight rail industry supports Amtrak’s announcement it is moving forward with inward facing cameras in its passenger train locomotives as Class I freight railroads have been proceeding with installing this technology since 2013,” remarked Hamberger.

Although he disagreed with the regulatory requirement regarding crew size for freight railroads, Hamberger stated, “Class I freight railroads do believe, technology like PTC could provide a redundant layer of safety, though the freight rail industry will continue to work with rail labor under the existing collective bargaining framework to identify when the presence of PTC allows for such a discussion without degrading safety.”

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Quebec’s Port of Saguenay Opens New Rail Link, Terminal

June 4th, 2015

Canadian government representatives were joined by other officials to mark the official opening of the $C37 million new rail link and intermodal rail yard at the Port of Saguenay, Quebec. The 12-kilometre rail line connects the Grande-Anse terminal in the Port of Saguenay to the Roberval-Saguenay rail line.

Representing the Canadian Minister of Transport Lisa Raitt at the ceremony, Denis Lebel, Minister of Infrastructure, Communities and Intergovernmental Affairs and Minister of the Economic Development Agency of Canada for the Regions of Quebec, said, “Our government’s support for public infrastructure has never been stronger. We are committed to investing in infrastructure projects that focus on creating jobs and promoting long-term prosperity across Canada.”

“The new rail link and intermodal rail yard will enhance the Port of Saguenay’s efficiency, support economic growth for businesses and residents in the region, and greatly contribute to Canada’s competitiveness internationally,” added Lebel.

The project will facilitate the transfer of goods from the railway network to ships at the Grande-Anse marine terminal and is a vital link for the regional mining industry in Quebec.

“The start of rail operations at the Grande-Anse marine terminal is a historical milestone in the Region’s economic development, and we are especially proud to have carried out this major project with our partners’ support,” stated Ghislain Harvey, chairman of the Board of Directors of the Saguenay Port Authority. “More than ever, the Port of Saguenay can now fully take on its role of gateway to Northern Quebec, particularly for the purposes of Quebec’s Plan for Northern Quebec and Quebec’s Maritime Strategy.”

Funding for the project came from the Government of Canada, which provided $15 million from the Gateways and Border Crossings Fund; the Quebec government, which contributed $10 million; and the City of Saguenay and the Saguenay Port Authority, each of which provided $6 million.

Canada’s Gateways and Border Crossings Fund is used to improve the flow of goods in Canada’s Asia-Pacific, Atlantic, and Continental Gateways.

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MTA New York City Transit’s Bianco to Retire

June 4th, 2015

Carmen Bianco, president of Metropolitan Transportation Authority (MTA) New York City Transit, has announced his plans to retire, effective August 2015. He served as acting president of MTA in April 2013 and was permanently appointed as president in September 2013. During his tenure, Bianco aligned management strategies, enhanced safety and improved customer service.

MTA Chairman and CEO Thomas F. Prendergast stated, “Carmen Bianco is a one-of-a-kind leader as well as a trusted friend, and while I understand why he is ready to retire now, we will all miss his detailed experience, his thoughtful perspective and his constant drive to make transit better for both our customers and our employees.”

“Through initiatives like establishing the FASTRACK program for subway maintenance and aggressively bringing new technology into the system, Carmen made the organizational culture of New York City Transit reflect the priorities that our customers expect. He will be missed,” concluded Prendergast.

Bianco served as head of the Department of System Safety for New York City Transit from 1991 to 1995. He also held senior safety positions at Amtrak and NJ Transit.

Bianco and his team guided the agency through significant snowstorms, Hurricane Irene and Superstorm Sandy. Despite more than $4 billion in Sandy-related damage, 80 percent of subway service was restored within five days. Under his leadership, his team is evaluating ways to deliver higher-capacity, more environmentally friendly and technologically advanced transportation and improved customer service.

“There is no more challenging job in the American transportation industry than keeping New York City moving every day and positioning it well to serve our customers for decades to come,” Bianco said. “It has been a privilege to lead our 48,000 employees who work so hard around the clock. I owe each of them a debt of gratitude, and it’s been an honor to have served New York City Transit.”

 

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GREX Breaks Ground on New Headquarters

June 3rd, 2015
The GREX Board of Directors break ground for the company's new headquarters. Photo: courtesy of GREX.

The GREX Board of Directors breaks ground for the company's new headquarters. Photo: courtesy of GREX.

Georgetown Rail Equipment Company (GREX) recently held a groundbreaking ceremony for the company’s new headquarters in Georgetown, Texas. The building is designed with more than 15,000 square feet to accommodate the company’s growth in developing technology for track inspection and material handling.

Tim Harris, vice president corporate affairs and business management, is leading the building project development.

“We are so excited to get this project underway.” stated Harris. “The planning and designing of the new building on our campus has been in the works for months, so to see it all begin, is great. We are all looking forward to the continuous growth of the company.”

“GREX is a unique and innovative group that prides itself on developing products and services that are setting new standards in safety and maintenance technology,” added Harris. “This new office space will help us continue to provide our railroads with the best quality customer service.”

According to GREX President William Shell, the headquarters is scheduled to be complete by the end of this year.

In the photo above from left to right: Phil Homan, Robert Holt, William “Wiggie” Shell, Chris Aadnesen, Jeannie Snead, Gerald Albin and John Kinnear.

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PHL Designated a SmartWay Transport Partner

June 3rd, 2015

The Environmental Protection Agency (EPA) has named Pacific Harbor Line (PHL), a subsidiary of Anacostia Rail Holdings, a SmartWay Transport Partner. The program designates freight carriers and shippers who are committed to improvements in supply chain efficiency and to reducing transportation-related emissions.

“PHL submitted locomotive fleet performance data for calendar year 2014, which the EPA then used to calculate an emissions/GHG footprint for PHL,” said Don Norton, PHL director of sales and administration. “It compared it to other rail carriers and modes of transportation and we met the program requirements.”

The EPA launched the SmartWay program in 2004 to challenge businesses to think about protecting the environment through reducing fuel consumption and improving air quality. Other railroads that are designated SmartWay transport partners include BNSF Railway, Canadian National Railway, Canadian Pacific Railway, CSX Transportation, The Kansas City Southern Railway, Norfolk Southern, and Union Pacific Railroad.

PHL President Otis Cliatt stated, “PHL welcomes the challenge of being a continued leader in the field of environmentally friendly railroads.”

PHL provides rail transportation services to the Ports of Long Beach and Los Angeles.

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Los Angeles Metro Approves 2016 Budget

June 3rd, 2015

The Board of Directors of the Los Angeles County Metropolitan Transportation Authority (Metro) approved a $5.56 billion FY 2016 Budget that includes funding for construction of five major rail lines.

Projects under planning/engineering in FY 2016 include the East San Fernando Valley Transit Corridor, the Airport Metro Connector, the South Bay Metro Green Line Extension, the West Santa Ana Branch and the Gold Line Eastside Extension Phase II.

The FY 2016 Budget calls for $2.1 billion in funding for various capital projects, including major construction for the Regional Connector Project, the Crenshaw/LAX line and the Westside Extension of the Purple Line subway.

The Expo Line extension to Santa Monica and the Gold Line Foothill Phase 2A extension to Azusa are expected to open before the summer of 2016.

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Lilee to Deploy ITCM System on Michigan Line

June 2nd, 2015

GE Transportation has chosen Lilee Systems to design and deploy the interoperable train control messaging (ITCM) communication system for the state-run track that travels 135 miles between Kalamazoo and Dearborn, Mich. The line is used for both passenger and freight rail.

John Harlan, Lilee’s strategic account manager, said, “The Michigan Line project is a testament to Lilee Systems’ technical expertise and capabilities in the design and deployment of ITCM communications systems, and it validates our experience in delivering Positive Train Control (PTC) communication solutions to railroads and transit authorities.”

Lilee Systems will provide its Wayside Status Relay Service (WSRS) and LMC-5500 and engineering design along with testing services. The company will also provide its Positive Train Control System Management Gateway (PTC SMG) for remote diagnostics and software upload capability for the locomotive, wayside, and back office environment.

“The primary factors that led GE Transportation to choose Lilee Systems include: (1) proven WSRS technology, (2) robust engineering and system design capabilities, (3) experience in providing interoperable train control (ITC) communications systems to Class I railroads, and (4) specific demonstrated success in working with the multiple Class I railroads that require interoperability with this implementation,” Harlan added.

Lilee Systems introduced the first commercially available WSRS platform in 2012.

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