From the editor — Taking steps toward a step change

What’s in store in 2025 for the rail industry? For North America? The world?

Too many assumptions based on too many variables + too much rhetoric = too many unknowns to be sure about much of anything.

That said, I do find it easier to side with glass-is-half-full hopefuls — the ones who believe that, in spite of the uncertainty, North American freight railroads (as in the Big 6) are as poised as they’ve been in years to increase traffic volume and boost market share.

We heard it (and heard it) last month at RailTrends®, our annual summit in New York City. I didn’t hear it cynically. RailTrends program consultant Tony Hatch didn’t, either. As he noted in his event recap, “growth” was the theme at RailTrends ‘24: “I know I can actually hear the groans out there, but all of the presentations stressed this. The talk is being talked, and service reliability, technology and capital are being provided to ease the walk.”

We also heard it from the six Class I CEOs in their responses to our questions about the year ahead, as Managing Editor Jeff Stagl wrote in his preface to our Class I outlook coverage.

Talking the talk or being poised to grow doesn’t mean railroads will actually gain share in 2025 — it’s never completely up to them, as it is. The interconnectedness of the supply chain means railroads’ fortunes are always tied up in others’ fortunes (or lack thereof).

What is up to railroads, as Oliver Wyman Partner Adriene Bailey stressed at RailTrends, is the extent to which they address shippers’ core issues. “It requires a step change,” she told attendees. “They have to get serious about delighting customers and making a serious commitment to transit reliability.”

An evolutionary thing

In the aggregate, railroads have a ways to go on those fronts. But they’ve been putting their strategic focus and planning tools where their mouths are. As CN President and CEO Tracy Robinson told the RailTrends crowd: “The secret is in building growth that’s more immune to economic cycles. We’re slowly doing that ...”

We might get a chance to see how railroads fare on the resiliency front sooner rather than later. We could see, for example, how each link in the supply chain responds to consumers’ response to the tariffs President-elect Trump has vowed to impose on goods coming from Mexico, Canada and China as soon as he takes office.

We could see it. Again, too many variables, too much rhetoric, etc. For now, I’ll lean into what CN’s Robinson said. To what rail leaders and some customers are saying — at RailTrends and within the pages of our December issue. Progress is an evolutionary thing, and, yeah, railroads need to pick up the pace. But they’re taking steps toward making a step change. Here’s hoping incremental and meaningful change continues to be a thing in ‘25.