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July 2012
By Pat Foran, Editor
If the data we've seen, orders we've been privy to and anecdotal evidence we've heard in recent weeks is any indication, the North American rail-car market is pretty healthy as we trudge past 2012's midpoint — healthy enough, perhaps, to preclude conversation about the historically cyclical nature of this market, and the need to smooth out same. Maybe that's what happens when we're on the relative upside of the cycle. Regardless, we just aren't hearing much "cyclical" talk.
Even so, not all the data suggests that smoothness rules. First-quarter rail-car orders totaled 12,473 units, well below Q1 2011's total of 36,903, according to the Railway Supply Institute's American Railway Car Institute Committee. But overall, there's been a "slow improvement for basic car types," says Rail Theory Forecasts L.L.C. President and Progressive Railroading columnist Toby Kolstad, noting that asset owners continue to retire older cars to rightsize their respective fleets.
"Newer cars are probably [still] in short supply," he says. "There are still thousands of surplus 70-ton box cars. Same goes for steel mill gons."
No question, the U.S. rail-car fleet continues to age (see pdf chart), but some car types are being replaced faster than others. Witness tank cars. Demand for new ones remains high, which has helped prompt observers to predict 2012 deliveries in the upper 50,000s to low 60,000s (see pdf chart).
As for 2013? In April, Economic Planning Associates Inc. (EPA) was projecting 59,000 deliveries, followed by 57,500 in 2014. From there, EPA expects bigger things: Rail-car assemblies will "gradually move up" to 60,300 units by 2017, according to EPA's April report. Gradual. Steady. Smooth.
Meanwhile, railroads and lessors continue to invest in locomotive power at a rate that's at least comparable to 2011's (see pdf chart) as they upgrade fleets in anticipation of traffic growth to come.
Transit agencies, too, expect steady growth in the form of ridership and system expansion. As a result, they're ordering an array of new passenger cars, diesel multiple units and light-rail vehicles. A sampling of recent order activity.
CONTENTS
Selected Car Fleet Data (pdf)
Railroad Car Owners (pdf)
Private Car Owners (pdf)
Freight Cars Installed by Class I Railroads and Others (pdf)
How the U.S. Freight Car Fleet Has Changed (pdf)
U.S. Freight Cars by Type and Age (pdf)
Class I Locomotives (pdf)
Roll call: Transit agencies share rolling stock plans
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