Freight-car orders “exploded” in the first quarter to 35,991 units after an “astonishing” 26,569 cars were ordered in the fourth quarter, according to Economic Planning Associates Inc.’s (EPA) quarterly “Outlook for Rail Cars” report.
Quarterly car assemblies increased to 18,500 units and the backlog rose to 86,900 cars and platforms — or five quarters’ worth of deliveries at current production rates — by March 31 compared with a 69,400-unit backlog on Dec. 31.
“We expect the rail-car market to remain vibrant as we proceed through 2006 and into 2007,” EPA officials said in the report. “Continued expansion of the U.S. economy and rail customer markets, the projected growth of merchandise trade and continued diversion of some truck traffic to rail will lead to further growth in rail-car orders.”
EPA is projecting deliveries of 76,000 freight cars and platforms by year end. After backlogs are worked off through 2006, deliveries will fall slightly to 73,000 units in 2007.
“Longer term, replacement pressures will be mounting among the steel-bodied coal car, box car, mid-sized and small-cube covered hopper, and multi-level flat car fleets,” the report states. “At the same time, growth in customer markets will propel demand for center beams, high-cube covered hoppers, tank cars, intermodal equipment and coal cars.”
As deliveries moderate through 2007, car deliveries will drop to 67,500 units in 2008 and gradually decline to 59,500 units by 2011, EPA said.
Source: Progressive Railroading Daily News
