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Rail News Home Rail Industry Trends

6/10/2010



Rail News: Rail Industry Trends

Number of stored freight cars falls in May, logistics report shows


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In May, freight cars in storage represented 23.8 percent of the entire fleet, down from 28.7 percent in January, according to the 21st annual “State of Logistics Report” recently released by the Council of Supply Chain Management Professionals and presented by Penske Logistics.

“Railroads have experienced enough growth in business to begin rehiring workers and taking freight cars out of storage,” the report states. “The railroad industry has abundant capacity and can readily bring it and workers back on line as demand grows.”

In December 2009, 28.8 percent of the entire fleet — or about 450,000 cars — were in storage compared with 32 percent in mid-2009. When the economy is healthy, typically 2 percent to 3 percent of cars are stored, the report states.

In addition, the report shows that business logistics costs fell to 7.7 percent of the U.S. Gross Domestic Product in 2009 vs. 9.3 percent in 2008. The cost for rail transportation was down 20.6 percent last year.

Overall, transportation costs were 20.2 percent lower than 2008 levels, with all modes of transportation “being negatively affected,” the report states.