June 2006
STB concerned by rail capacity constraintsThe Surface Transportation board wants to know by July 17 how the railroads plan to cope with peak season and continuing traffic demands. “There is heightened focus this year on the ability of the railroads to meet demands for rail service,” said STB Chairman W. Douglas Buttrey in a letter to railroad CEOs. “At least four major factors have converged to cause this heightened focus: the healthy domestic economy, growth in export/import traffic, the agriculture sector's forecast of record harvests, and the fact that rail infrastructure has begun to show capacity constraints.”
Buttrey asked the railroad chiefs to provide the STB with information on steps taken to prepare for this season's peak shipping business, performance goals for the remainder of the year; plans for achieving those goals, and plans to communicate all of this to customers.
Carload and intermodal volumes again riseThe Association of American Railroads has reported new gains in U.S. traffic, with carloadings up 1.8% and intermodal volume up 7.9% in the week ended June 24. Coal volume was up 5.1% and grain carloadings rose 17.1%. Total freight volume, in ton-miles, was up 3.1%. In Canada, carload traffic rose 2.1% and intermodal volume was up 9.7%. Kansas City Southern de Mexico reported carload volume down 1.4% and intermodal down 10.8%.
FreightCar America building 150 triple hopper carsFreightCar America announced that it is delivering 150 multi-purpose steel triple hopper cars to Wheeling & Lake Erie—the first new cars the railroad has ever purchased. Ed Whalen, the carbuilder’s senior vice president-marketing and sales, said it’s “the first order of steel triple hoppers the industry has been in many years [and] we already have negotiated a follow-on order for similar open top hopper cars.” W&LE President Larry Parsons said the cars initially will be put into iron ore service.
CN derailment in B.C. kills two crew membersCN confirmed the death of two crew members in the derailment last night of a locomotive and a loaded lumber car about 25 miles north of Lillooet in British Columbia’s Fraser Valley. A third crew member was injured.
National Carriers' Conference Committee withdraws contract offer to UTUThe National Carriers' Conference Committee and the United Transportation are at an impass. Made up of BNSF Railway, CSX, Kansas City Southern, Norfolk Southern, and Union Pacific representatives, the committee met with UTU staff this week to again discuss its earlier contract offer, which “would provide substantial financial benefits and employment security to current employees. In return, we asked union negotiators to discuss proposed staffing changes that would permit us to operate trains more efficiently with fewer people.”
The UTU rejected this proposal in the spring. In a June 28 letter to transportation supervisors, the committee wrote that UTU challenged “the legality of the railroads' national bargaining proposal on staffing and consolidation of operating positions. On March 10, a federal court ruled that the union was not legally obligated to bargain nationally on that proposal. The court also agreed with the railroads that UTU would have to bargain nationally over the railroads' alternative proposal that wages be reduced to compensate for artificially high crew size. And while the federal court said the UTU was free to directly negotiate crew size issues on a voluntary basis, union negotiators have steadfastly refused to do so.”
For a second time, after two days of negotiations this week, the UTU said “no” to discussing crew staffing changes, the committee wrote. And that decision prompted the committee to withdraw its contract offer, which “included a 'no furlough guarantee for current employees as a result of any change in crew consist rules; earnings protection for up to six years for current employees on territories where one-person operations are implemented; annual wage increases or substantial bonus opportunities; significant cash payments to current employees as one-person operations are implemented; paid voluntary reserve boards for surplus employees; and voluntary separation payments for employees who wanted to retire or leave their jobs.”
The committee also wrote that the refusal to discuss staffing changes “has forced us to seek a wage freeze in order to help offset unnecessary costs to railroad operations incurred by being forced to operate assignments staffed with redundant positions. Our stand is consistent with the court ruling, which said the railroads could go even further and propose pay cuts absent an agreement with the UTU on staffing.”
According to the committee, this is “not the outcome we want. We would much prefer to put back on the table” the original contract offer. “All it would take to make that happen would be for UTU leaders to accept our invitation” to discuss staffing issues.
In a statement, UTU said: "Perhaps the carriers' chief negotiator, Bob Allen, said it best: 'We are miles apart.'
"The UTU is dismayed that in spite of record profitability and record executive bonuses--made possible, in part, through employee productivity improvements--the carriers on June 27 proposed a wage freeze for existing train service employees, a 20% permanent wage reduction for all new train-service hires, elimination of all future cost-of-living adjustments, and a very siginificant increase in health-care and prescription-drug cost sharing.
"The UTU is equally disappointed that that the carriers' labor negotiators rejected outright our suggestions for improved training of new and existing train and engine service employees--a position seemingly at odds with what the carriers' lobbyists are telling Congress.
"The federal mediator assigned to our negotiations has scheduled another negotiating session for 'dates to be determined in October.'
"In the meantime, the UTU will continue to press its case for improved train and engine service employee training with the Federal Railroad Administration, and we plan to participate in a July 25 FRA forum on this matter and hope the carriers will similarly participate."
Greenbrier posts 28% increase in earningsThe Greenbrier Companies has issued a quarterly earnings statement that it says reflects “margin expansion and strong industry fundamentals.” Excluding special charges, Greenbrier reported earnings of $13.7 million or $0.86 per diluted share for the fiscal quarter ended May 31, up 28% from the prior-year quarter. Including special charges this year for a tentative federal income tax settlement and last year for debt prepayment, net earnings this year grew 18% to $10.7 million.
“All major lines of business performed well this quarter, with significant margin enhancement driving the company's earnings growth," said President and CEO William A. Furman, adding that “we continue to see strong rail industry fundamentals.” Greenbrier has increased its fiscal 2006 earnings to $2.45 to 2.50 a share, excluding the third quarter tax charge.
On May 31, the company's new railcar backlog was 16,900 units valued at $1.14 billion compared to 18,300 units valued at $1.19 billion on May 31, 2005. Since that time Greenbrier has received orders for an additional 600 double-stack intermodal platforms.
Union Pacific handles “unprecedented volumes” In a letter to Union Pacific customers dated June 27, Executive Vice President Marketing and Sales Jack Koraleski said the railroad has recently been handling “unprecedented volumes without any deterioration of service-another encouraging sign that our strategy of capital investment and network management initiatives is resulting in a stronger railroad.”
Koraleski said that since a June 16 release reporting a record seven-day volume of traffic, “we've broken our record for any seven-day period two more times, peaking at 201,407 for the seven days ended June 17. May's all-time seven-day average for any month and the seven-day records set in June are the first time either record has been set outside the traditional August-December peak season and the first time carloadings have topped 200,000 in seven days.”
UP this year will invest approximately $2.8 billion in maintenance, track capacity, locomotives, freight cars, and technology, on top of the $5 billion invested in the two prior years, Kioralesk, said. New operating plans are also paying off.
“Our Unified Plan has created a more efficient transportation plan,” said Koraleski, “generating capacity by making better utilization of resources and track space, while our Customer Inventory Management system (CIMS) has helped to drive significant improvement in terminal performance. CIMS, which matches the track capacity at customer locations with the flow of railcars to and from the location, creates capacity and fluidity in our yards. In terminals where CIMS has been implemented, we've seen dwell time improve by 20-25% and switching performance improve by 35-50%. We've implemented CIMS for about 60% of the to/from industry movement and we are on track to have 70% covered by year-end.”
Koraleski said UP is preparing for “what appears to be a record-setting peak season. Over the next several weeks, in addition to continued track work and capacity expansion projects, we expect to receive the final 134 of the 200 new road locomotives ordered for 2006 and 800 of the 2,700 freight cars. Implementation of our Unified Plan cross our Southern Region and the continued maturing of our CIMS process should drive further improvement.”
For CPR and United Steelworkers, a new three-year agreementCanadian Pacific Railway has reached a “tentative” three-year agreement with the United Steelworkers union, which represents 1,500 employees at intermodal facilities across Canada. Once ratified, the agreement will run from Jan. 1, 2007, to year-end 2009. It includes wage and benefits improvements plus work rule changes to “enhance work/life balance, while, at the same time, help improve productivity and manage costs.”
ENSCO sales reach $100 million markAfter 37 years in business, ENSCO, Inc.'s annual sales hit $100 million on June 15. In celebration of this milestone, the Falls Church, Va.-based research and development firm surprised its 850 employees with $100 bonuses for their contributions.
ENSCO serves the transportation, security, defense, environment, aerospace, and intelligent automation industries. It maintains major offices in Springfield, Va.; Endicott, N.Y.; and Melbourne and Cocoa Beach, Fla.; plus field offices across the U.S. and in Beijing, China.
FRA issues crashworthiness standards for freight locomotivesBeginning January 2009, all new and rebuilt freight locomotives will be required to meet Federal Railroad Administration crashworthiness standards. The agency today published the “first-ever” regulations, which it said will give train crews a “better chance of survival” after locomotive collisions. They are intended to prevent the locomotive cab from being crushed during a head-on collision with another locomotive or when it strikes the rear of another train, a shifted load on an adjacent train, or a vehicle at a grade crossing.
The standards include upgraded structural elements such as stronger collision posts, the addition of anti-climbing equipment to keep locomotives upright and on the tracks after an accident, strengthened fuel tanks to prevent spills, and reconfigured cab interiors to “soften many sharp edges and provide better emergency lighting and exits,” said FRA Administratr Joseph H. Boardman.
The new federal regs were developed with the Locomotive Crashworthiness Working Group of the Railroad Safety Advisory Committee. According to FRA, they “incorporate and expand on effective railroad industry standards first implemented in 1989 that have significantly improved the crash performance of new locomotives.”
CSX readies for summer maintenance blitz In just eight days, CSX Transportation plans to completely rehabilitate its main line between Parke Junction, S.C., and Shelby, Ky. (on the Kingsport, Blue Ridge, and Spartanburg subdivisions). Starting July 3, 300 maintenance-of-way workers will install nearly 212,000 linear feet of rail and 75,000 tons of ballast, and surface 58 miles of track. Extensive trackwork will be performed in the Sandy Ridge tunnel, as well.
Because the line will be largely shut down from July 3 until July 10, most linehaul traffic will be rerouted via other railroads and gateways, which will result in a 24- to 48-hour increase in transit times, according to CSX.
UP realigns regional operations, appoints new staffUnion Pacific will reorganize its operating units, effective July 1. The Kansas City-based Central Region will be eliminated. Brought under the Northern Region (Omaha, Nebr.) umbrella will be the Kansas City and St. Louis service units. The North Little Rock and Wichita units will join the Southern Region (Spring, Tex.). The Western Region (Roseville, Calif.) remains unchanged.
Calling the move “another step in simplifying our network,” UP Executive Vice President-Operations Dennis Duffy explained that the new Northern Region “will provide unified management of all Central Corridor routes to the east, as well as our two highest-volume eastern gateways--Chicago and St. Louis,” while the Southern Region “will result in the key terminal of North Little Rock, Pine Bluff, and Houston being managed as an integrated operation.”
As part of the reorg, Joe Santamaria has been appointed vice president-Transportation, replacing Jeff Koch, who will retire later this year. Lance Fritz succeeds Santamaria as vice president-Southern Region. Randy Blackburn, former vice president-Central Region, becomes vice president-Northern Region, replacing Fritz.
In addition, UP has named Rod Richardson general superintendent-Proviso Service Unit, and Rick Turner, vice president-Premium Operations. Linda Brandel succeeds Turner as vice president of UP's National Customer Service Center.
SEPTA adopts $438 million capital budgetThe Philadelphia area's SEPTA system has adopted a capital improvement budget totaling $438 million for FY 2007. It provides for the acquisition of new Silverliner regional railcars, a continuing bus purchase program, the Market Street Elevated Reconstruction Project, Regional Rail Route R5 Paoli Line improvements, and rehabilitation of the Girard and Spring Garden stations on the Broad Street line. SEPTA also adopted an operating budget of $991 million for FY 2007, a $9 million increase over the current budget reflecting higher costs in wages, fuel, materials and services, and healthcare. A budget shortfall of $50 million is currently projected.
Traffic running well ahead of last yearFor the week ended June 17, railroad carload traffic in the U.S. was up 4.1% from a year earlier, intermodal volume was up 8.9%, and total volume, measured in ton-miles, increased 5.9%. A 10.3% surge in coal volume accounted for much of the carload gain.
On Canadian railroads, carload traffic was down 0.9% in the week ended June 7, but intermodal volume grew 10.0%.
Mineta quitting DOT in JulyNorman Y. Mineta has informed the White House that he is resigning as Secretary of Transportation, effective July 7. The lone Democrat in President George W. Bush's cabinet, Mineta is stepping down voluntarily at the age of 74. He's one of three of Bush's original cabinet members that are still on the job; the others are Secretary of Defense Donald M. Rumsfeld and Labor Secretary Elaine Chao.
There is no word yet on who will take over the top spot.
In his letter of resignation to President Bush, Mineta recalled many accomplishments--the passage of SAFETEA-LU, the DOT's work after 9/11 and its creation of the Transportation Security Administration, and the agency's efforts to rebuild Afghanistan's and Iraq's transportation infrastructure--but acknowledged that “it is time for me to move on to other challenges.”
White House Press Secretary Tony Snow said “the president and vice president and others were happy with the five and a half years” that Mineta put in at DOT.
Commented APTA President Bill Millar: "[Mineta] has worked relentlessly to advance transportation choices for all Americans, and we owe him a debt of gratitude for his many, many years of public service. "
The Senate confirmed Mineta, President Bill Clinton's Commerce secretary and a former California congressman, as DOT secretary on Jan. 24, 2001 (RA, Feb. 2001, p. 17). He served in Congress for 21 years, where he was chairman of the House Transportation and Public Works Committee and an architect of the landmark Intermodal Surface Transportation Efficiency Act.
Rail rates lower now?From 1985 to 2004 “all [rail] rate changes were below the rate of inflation and thus all rates have declined in real terms,” according to a newly issued Government Accountability Office report. Coal shipper rates “dropped even more sharply than industrywide rates, declining 35%,” the GAO told a congressional committee yesterday. Association of American Railroads President and CEO Edward R. Hamberger commented: “I don't know of many other industries charging less for their services in 2006 than they did in 1985.”
But captive shipper rates are another story. According to the GAO report: "It is difficult to precisely determine the number of shippers who are 'captive' to one railroad because proxy measures that provide the best indication can overstate or understate captivity. However, our preliminary analysis indicates that while the extent of potential captivity may be dropping, the share of potentially captive shippers who are paying the highest rates--those substantially above the threshold for rate relief--has increased. Whether this increase reflects an exercise or possible abuse of market power or is simply a reflection of rational economic practices by the railroads in an environment of excess demand remains uncertain."
RailAmerica undergoes reorgRailAmerica's three new business units, Operations East, Central, and West, represent another step in the short line holding company's five-year strategic plan to become “leaner, more profitable, and more competitive.”
Late yesterday, RailAmerica announced that the units will be headed by separate presidents, promoted from within the company: Jan Polley (East), Scott Hulstrom (Central), and Ray Stephens (West). The move results in the immediate elimination of 20 mostly upper and middle management positions, half of which are from the corporate office in Boca Raton, Fla. Previously, RailAmerica employed about 130 managers at the affected levels.
Certain corporate functions will be shifted to a “shared services model” and new business processes will be implemented throughout the year to support the new structure. RailAmerica will report a pre-tax charge of about $1.8 million in the second quarter, due to the reorganization.
Commenting on the rationale behind the changes, CEO Charles Swinburn said: “RailAmerica has achieved its growth during the last 20 years by acquiring other railroads, each with its own processes, procedures, and structures. This has resulted in redundancies and inefficiencies in our organization.”
The company's continuing “Process Improvement Project” is expected to save $10-$15 million in operating expense and capital savings beginning in 2007.
Moorman to keynote customer service forumNorfolk Southern Chairman, President, and CEO Charles W. (Wick) Moorman, who is also board chairman of the Association of American Railroads, will be keynote speaker at a railroad customer service forum in St. Louis Sept. 13. “We have held these forums for the last couple of years and have found them to be tremendously successful,” said AAR President and CEO Edward R. Hamberger. “The railroads appreciate the opportunity to present their plans and strategies to effectively handle the continued record levels of freight.” Rail customers wishing to attend the forum may register on line by following the “2006 Customer Forum” link at www.aar.org.
“Iron Horse” or “Cash Cow”?“For captive chemical shippers, the ‘Iron Horse’ has become a greedy ‘cash cow,’” a witness for the American Chemical Council (ACC) told the U.S. Senate Subcommittee on Surface Transportation and Marine today. The witness—John McIntosh, president of Chlor Alkali Products, Olin Corp.—also told the hearing that “railroad monopolies are driving a ‘golden spike’ through the heart of American competitiveness,” and “free and fair market forces no longer ride American rails.” Declaring that “the system is broken and Congress needs to fix it,” ACC urged the enactment of legislation to restore rail competition and ensure that antitrust statutes cover railroads.
Bombardier to build new APM at Las Vegas airportThe Clark County Department of Aviation has awarded a $43 million contract to Bombardier Transportation to install a new automated people mover system (APM) at McCarran International Airport in Las Vegas, Nev. The dual-lane underground system will connect the new Terminal 3 with the existing D-gate concourse. It will augment two existing Bombardier APM shuttles that went into service at McCarran in 1985 and 1998, respectively. The new contract includes six CX-100 vehicles and associated equipment for the 1,200-foot system, which is scheduled to be completed in 2011.
Trinity increases earnings estimateTrinity Industries stock rose 6.4% in morning trading on the New York Stock Exchange following the company’s announcement late yesterday that it was increasing its second-quarter earnings guidance to 60-65 cents per diluted share from an earlier estimate of 52-57 cents. “Our rail and barge businesses have exceeded our previous expectations, said Trinity Chairman, President, and CEO Timothy R. Wallace.
Atlantic City places its bets on new train serviceA one-seat ride from New York City’s Penn Station to Atlantic City, N.J., is in the cards for casino devotees. NJ Transit agreed yesterday to operate a three-year demonstration service paid for by casino and hotel interests in the New Jersey resort city. Eighteen trains will be operated on weekends, from Friday afternoon to Sunday night, beginning in late 2007. NJ Transit will buy eight multi-level cars and lease four Amtrak diesel locomotives for the service. The trains are expected to provide 1,100 round-trips, or 2,200 rides, each weekend.
“This public-private sector effort is an innovative way to open up new markets for one of New Jersey’s top tourist destinations,” said Gov. Jon Corzine.
Terms of the contract include reimbursement for all capital and operating costs by Atlantic City Express Services, LLC, a partnership of hotels, and the Casino Reinvestment Development Authority.
NJ Transit, Metro-North renegotiate contractTo reflect increases in services and ridership since the previous agreement was reached, NJ Transit and Metro-North have renegotiated the contract under which the New Jersey commuter railroad operates trains on behalf of Metro-North for nearly 5,400 New York State riders on the Port Jervis and Pascack Valley lines. NJ Transit said the new, seven-year contract also more accurately reflects its costs in providing the service.
Cubic wins Northern Rail UK contractNorthern Rail Limited, the largest train operating company in the UK’s privatized network, has placed a $4 million order with Cubic Transportation Systems Limited for its next-generation ticket-issuing system. The new system, FasTIS, will replace another Cubic System, APTIS, which has been widely used in the UK for 20 years. Cubic says FasTIS “was also designed for use with Cubic’s contactless reader module used in London’s Oyster® ticketing system, which allows it to be interoperable with the Oyster card.”
Norfolk Southern adopts new-design coal car Norfolk Southern is acquiring 1,200 hybrid stainless steel/aluminum coal gondola cars from FeightCar America, Inc.--a new design that the railroad has selected to initiate a long-term car replacement program. FreightCar America said it developed and prototyped the hybrid car in conjunction with Norfolk Southern “to address the unique transportation requirements of eastern coal.” It's similar to the carbuilder's BethGon® coal car with its patented cold-rolled center sill. The carbody contains stainless steel to withstand the application of heat to thaw coal.
NS is also acquiring 400 AutoFlood III™ bottom-discharge coal cars from FreightCar America. Delivery of the 1,600 car order is scheduled will begin in the first quarter of 2007 and to be completed by year-end. All of the cars will be produced a FeightCar America's plant in Roanoke, Va., a former Norfolk Southern facility.
“Sesquicentennial Limited” rolls into historyYesterday, Railway Age celebrated 150 years of publishing with the “Sesquicentennial Limited,” a luxury inspection train that operated round trip between Hoboken and Bay Head, N.J., on NJ Transit’s North Jersey Coast Line. Approximately 125 representatives from 18 corporate sponsors participated. The event raised over $20,000 for the American Public Transportation Foundation scholarship fund.
Simmons-Boardman Publishing Corp. would like to thank all its sponsors, the Juniata Terminal Company and Morristown & Erie Railway, which provided the train’s historic private cars and E8 locomotives, and NJ Transit. Our corporate sponsors included Alstom, Ansaldobreda, Bombardier, CSX, DMJM Harris, Kawasaki, LTK, Norfolk Southern, Okonite, Pandrol USA, Parsons, PB Rail & Transit, Siemens, STV, SYSTRA, Railroad Financial Corp., Wabtec, and Washington Group International.
The “Sesquicentennial Limited”will be featured in the pages of the July and September issues of Railway Age. The September issue will be a special commemorative one marking the magazine’s 150th anniversary.
Rail traffic starting to slow?U.S., Canadian, and Mexican intermodal and carload traffic may be starting to level out, according to an Association of American Railroads report. During the first 23 weeks of the year, U.S. railroads carried 5.30 million trailers/containers, up 6.4% from the same period last year, and 7.76 carloads, up 1.3%. They saw total volume of 765.4 billion ton-miles increase 2.4%. While Canadian trailer/container loadings rose 5.5% to 1.02 million, carloads fell 2.3% to 1.71 million. Kansas City Southern de Mexico, one of Mexico's largest railroads, reported traffic declines as well. Total volume of 262,077 cars fell 5.7% and 88,672 trainers/containers dropped 7.5%.
Railroads demand limits on hazmat liabilityRailroads warned Congress yesterday that they “cannot continue to transport highly hazardous material under the conditions that currently exist.”
“The inordinately high risks now shouldered by the railroads must be dramatically reduced through improved safety and the provision of reasonable liability protection,” said Association of American Railroads President Edward R. Hamberger in testimony prepared for the House Transportation Infrastructure Committee. Otherwise, said Hamberger, Congress should relieve the industry of its common carrier obligation to haul toxic-inhalation or other highly hazardous substances.
While accidents involving these materials are “exceedingly rare,” said Hamberger, “the insurance industry is unwilling to insure railroads against the multi-billion dollar risks associated with highly hazardous shipments.”
Hamberger mentioned a number of technologies that have been deployed or are being developed to improve rail safety, including train-control and fault-detection technology, stronger alloys for tank-car wheels, and metallurgy to improve track stability. He said the AAR's Tank Car Safety Committee is evaluating a new standard for chlorine and anhydrous ammonia cars that would reduce the risk of rupture by more than 50% and is also studying “whether the phase-out of tank cars constructed of non-normalized steel should be accelerated.”
Bombardier wins $91 million London orderBombardier Transportation announced that it will supply an additional 31 automatically guided cars to Docklands Light Railway of London at a price of $91 million. Docklands placed an initial order with Bombardier for 24 cars in May 2005.
CN acquiring 50 4,300-hp EMD locomotivesCN will acquire 50 4,300-hp SD70M-2 locomotives from Electro-Motive Diesel, Inc., in preparation for the opening next year of the Port of Prince Rupert, B.C. intermodal terminal. “These new locomotives will position us to accommodate rising traffic volumes on our Western Canadian network, and, in particular, anticipated new Prince Rupert freight volumes,” said CN President and CEO E. Hunter Harrison.
The new units are being acquired under an option that was part of a CN order for 25 SD70M-2s in April 2005.
KCS promotes Schoener, orders 60 new dieselsArthur L. Schoener has been elected president and chief operating officer (COO) of Kansas City Southern. He was previously executive vice president and COO of KCS. Michael R. Haverty remains as chairman and CEO of the company. The KCS board has also approved acquisition of 30 GE Transportation Systems ES44AC locomotives for delivery in late 2006 and early 2007, and 30 EMD SD70ACe units to be delivered by the end of the third quarter of 2007.
KCS said Schoener will continue to lead the Kansas City Southern Railway Co. (KCSR) as president and CEO, will oversee Kansas City Southern de Mexico, S. A. de C.V. operations as vice chairman of the KCSM board, and will oversee the Shard Services organization, which provides purchasing, marketing, human resources, labor relations, information technology, and legal services for both KCSR and KCSM.
HDR selected as Houston consultantHDR will provide design development/conceptual and preliminary engineering services for Houston Metro's Metro Solutions North Corridor. Metro Solutions, a $2 billion program to expand light rail service and add new bus rapid transit lines, commuter rail, and intermodal facilities, includes a North Corridor plan to extend the existing LRT line along Main Street approximately one-half mile to a station near Burnett Street. It also will include an upgraded guided rapid transit system linking the Burnett Street station to the Northline Mall area, a distance of about five miles. HDR will serve as a subconsultant to Dannebaum on the project.
HDR/S.R. Beard & Associates was recently selected as general planning consultant for Metro Solutions (See Breaking News Update, May 25, 2006).
TMCA announces marketing and communications award winnersThe Transportation Marketing & Communications Association (TMCA) presented more than 80 Compass awards to North American transportation and logistics firms for their effective strategic marketing or communications programs. Some 72 companies submitted more than 200 entries in the 2006 competition. Eight teams of industry professionals (clients, consultants, educators), outside experts, and media nationwide conducted the judging and selected 80-plus winning entries.
Following are among the rail/intermodal companies recognized in 10 separate categories:
* Integrated communications: Tri-Met, award of excellence and award of merit; LM&O Advertising for Washington Metropolitan Area Transit Authority (WMATA), award of merit; and Chicago Transit Authority, award of merit.
* Single advertisement: KempGoldberg for Schneider National, award of excellence and award of merit; LM&O Advertising for WMATA, award of merit; and Maryland Transit Administration, award of merit.
* Advertising campaign: GE Rail Services, award of merit; and Greater Vancouver Transit Authority, award of merit.
* Direct marketing: CSX Intermodal Express (submitted by Robin Shepherd Group), award of excellence; and KempGoldberg for Schneider National, award of merit.
* Communications collateral: CN, award of excellence; KempGoldberg for Schneider National, award of merit; Amtrak, award of merit; GO Transit, award of merit; and Maryland Transit Administration, award of merit.
* Publications: Amtrak, award of excellence; KempGoldberg for Schneider National, award of merit; and GATX Rail, award of merit.
* New Media: Amtrak, award of excellence; ALK Technologies, award of merit; GE Rail Services, award of merit; Greater Vancouver Transit Authority, award of merit; MTA New York City Transit, award of merit; and SEKO Worldwide, award of merit.
* Audio visual: BCP Group for CN, award of merit.
* Special events: Port Authority of New York and New Jersey, award of excellence; Capitol Corridor Joint Powers Authority, award of merit; MTA New York City Transit, award of merit; and Tri-Met, award of merit.
* Media relations: GE Rail Services, award of excellence; KempGoldberg for Schneider National, award of merit; and GO Transit, award of merit.
Passenger rail agencies place $180 million locomotive orderWabtec Corp. subsidiary MotivePower, Inc., has signed contracts with Utah Transit Authority and Southern California Regional Rail Authority to build 22 MPXpress® commuter locomotives, valued at $60 million. Eleven units each will be delivered to UTA in 2007 and SCRRA in 2008. The multi-agency procurement includes options for another 45 locomotives, worth $120 million, which will be exercised within the next five years by UTA, SCRRA, Massachusetts Bay Transportation Authority, and Northstar Commuter Rail Project of Minneapolis.
Work on the base order is expected to start this year at MotivePower's Boise, Idaho, facility. Such components as the micro-processor control system, braking equipment, brake shoes, and radiators will be produced by other Wabtec subsidiaries.
Enter now! RMI's “Fast Track” awards deadline is Aug. 1RMI is holding its second-annual Fast Track awards competition to recognize railroad customers that maximize the firm's web-based applications for managing rail operations, improving customer service, and reducing costs.
To qualify, entrants must demonstrate, among other factors: “consistently high percentage compliance with TRAIN II reporting standards; advanced management reporting through SuperTrip, RailConnect Query Tool, or other third-party tools; use of RailConnect EMS services to better control car hire costs or increase fleet earnings; advanced use of ShipperConnect FMS services to improve fleet performance and customer service; advanced use of automation to report events using tools such as AEI and m-Crew; and utilization of tools such as e-BOL and ShipperConnect to automate the flow of information between the railroad and its customers.”
For more information and to receive an application, contact RMI's Jennie Baker at (404) 355-6734 or jennieb@railcarmgt.com. The deadline is Aug. 1. Winners will be announced in December.
Ladd leaving Metra after 22 yearsJeffrey Ladd, who has served as chairman of the Chicago area's Metra Commuter Rail since it was created in 1984, says he plans to step down as he nears his 65th birthday. Ladd won Railway Age's W. Graham Claytor, Jr. Award for Distinguished Service to Passenger Rail in 1995.
CPR lands big new Toyota contract Toyota will open a new plant at Woodstock, Ont. in 2008 with capacity to build 150,000 RAV4 sport utility vehicles annually, and Canadian Pacific Railway will haul away most of the finished vehicles. In announcing a long-term agreement with Toyota Motor Sales on June 8, CPR said it has started an environmental assessment for a new rail facility to service the plant.
CPR President and CEO Fred Green said the contract ”builds on our already strong partnership with Toyota. We have been supplying rail service to Toyota's Cambridge plant for more than 17 years and this agreement demonstrates that Toyota is confident in CPR's ability to provide the same quality rail service to their new Woodstock plant."
Funding scratched for CSX rail relocationHouse and Senate conferees have reached agreement on a $95.4 billion bill to fund the costs of war and post-Katrina rebuilding, but one warmly contested provision--for a $700 million rail relocation--is not in the version that will go to the White House. Proponents of the relocation wanted to replace an existing CSX Transportation right-of-way along the Mississippi Gulf Coast with a highway. CSXT has already invested more than $200 million in repairs to the hurricane-damaged line.
U.S. railroads set weekly coal traffic records in MayFueled by a 10.2% increase in coal movements, U.S. rail carload traffic was up 3.9% in May over May 2005.
“Average weekly coal carloadings on U.S. railroads in May 2006 were higher than in any month in history, and average weekly U.S. coal carloadings in January, February, March, and April 2006 were all among the top months in history, too,” said Craig F. Rockey, vice president of the Association of American Railroads. Other commodities posting carload gains in May were crushed stone, sand, and gravel, up 6.9%, and grain, up. 2.1%.
Originated intermodal freight increased 7.3% in May compared with May 2005.
Weak spots in the May carload traffic picture included nonmetallic minerals, down 14.6%; motor vehicles and equipment, down 2.6%; primary forest products, down 18.2%; and chemicals, down 1.4%.
For the first five months of 2006, total U.S. rail carload traffic was up 1.1%, and intermodal traffic was up 6.2%. Ton-mile volume rose 2.3%.
Canadian carload traffic was down 3.2% in May and down 2.4% for the year to date. Canadian intermodal traffic increased 6% in May and 5% in this year's first five months.
Mexico's largest railroad, Kansas City Southern de Mexico (formerly TFM), reported a 5.6% drop in May 2006 carloads from May a year ago and a 7.2% decrease in intermodal units. For the first five months, carloads dropped 5.8% and intermodal was down 7.1%.
NS makes another hurricane relief donation The Norfolk Southern Foundation has donated $830,000 to assist in the recovery efforts of Gulf Coast communities. This is the second part of the Norfolk Southern Corp. subsidiary's assistance program to support economic development, environmental clean-up, and rebuilding work of Louisiana, Alabama, and Mississippi residents, which include 1,800-plus NS employees.
Commented NS Chairman, President, and CEO Wick Moorman: “With the start of this hurricane season, many of the communities Norfolk Southern serves are still struggling to recover from the last one. We hope these funds will hasten a full recovery and help these communities become better prepared to weather future storms.”
In the aftermath of Hurricane Katrina, NS employees contributed more than $176,000 in assistance, which the Foundation matched for a total exceeding $352,000.
1,000 Bombardier metro cars delivered to ChinaBombardier delivered its 1,000th rapid transit railcar to China on June 6 at a ceremony coinciding with the 2006 Metro and Light Train exhibition in Guangzhou. The vehicle is a MOVIA metro car produced for the Guangzhou city metro system by a joint venture of Bombardier and Changchun Railway Vehicles Ltd. Bombardier cars are also in service in Shanghai, Shenzhen, and Hong Kong.
Bombardier and its joint ventures currently employ around 2,4000 people in China, serving the rail transportation and regional aircraft markets. Recent rail contracts awarded to Bombardier have included automated cars for the Beijing Capital International Airport Link (which Bombardier is supplying under an earlier contract), a high speed train maintenance center and 20-year services contract with the Ministry of Railways, 40 eight-car high speed trainsets, and 361 high-altitude passenger cars.
Former railroad CEO Ed Moyers dies at 77Edward L. Moyers, Jr., 77, who served successively as CEO of Midsouth Rail Corp., Illinois Central Railroad, and Southern Pacific Lines in the 1980s-90s, died in Naples, Fla., on June 5. Moyers was Railway Age's Railroader of the Year in 1995.
Writing in the January 1995 issue of Railway Age, Senior Editor Gus Welty said “Illinois Central, in many ways a railroad in search of itself, found itself under Ed Moyers. He slimmed it, trimmed it, made it profitable, took it public.” Throughout his career, Moyers was a champion of seamless service.
BNSF to rail fans: "I want you!"BNSF Railway is asking rail fans nationwide to support its security efforts by registering for a new program, Citizens United for Rail Security (CRS), and reporting any suspicious activities.
Because rail fans photograph and watch trains, “it seems natural to harness their interest to help keep America's rail system safe,” BNSF's General Director-Police and Protection Solutions William Heileman said during today's announcement.
Participating rail fans will receive an official identification card and be able to access news and information on the CRS website (http://newdomino.bnsf.com/website/crs.nsf/request?open).
CRS is an outgrowth of BNSF ON GUARD, a grassroots program that encourages BNSF employees to report suspicious activities or trespassers. Since its inception in 2003, more than 200 employees have reported theft, vandalism, arson, attempted suicide, and other criminal violations, threats to safety, or unusual events on or near railway properties.
New Mexico-U.S. intermodal lane to open later this monthKansas City Southern's plan to develop an international intermodal corridor, connecting Lazaro Cardenas (Mexico) to the southeast and central U.S. is well on its way. The railroad holding company announced today that its subsidiaries Kansas City Southern de Mexico, S.A. de C.V., and Kansas City Southern Railway will offer a new route from Lazaro Cardenas, San Luis Potosi, and Monterrey, Mexico, to the southeastern U.S. markets via Jackson, Miss., with continuing service to Atlanta, Ga., starting the week of June 18. It will provide “Asian trading partners with a competitive alternative to more congested West Coast ports,” the company said.
“This is a tremendous service offering for shippers in this lane,” said Eduardo Videles, president of Transport Cargo Service, the logistics coordinator for the route. “This service brings all the key players together in one logistics cycle with extraordinary results.”
The dedicated service will operate daily from Lazaro Cardenas with early delivery on the sixth day to Jackson and on the seventh day to Atlanta. Primary shipments will be consumer and manufactured goods from containers originating at the Port of Lazaro Cardenas and trailer-load goods out of San Luis Potosi and Monterrey.
KCS plans to expand service to Houston, Tex., and Kansas, Mo., in the future (See breaking news update, May 31, 2006, “For Schneider, CSX, and KCS, a new intermodal initiative.”)
Commented Gonzalo Ortiz, general manager of Hutchison Port Holdings (Lazaro Cardenas): “The service is just in time to assist customers with peak season and is a clear indicator of the growth of traffic and capacity planned for this Port.” In March, Hutchison Port Holdings began expansion work on a specialized container terminal at the port. The first of three phases, valued at $200 million, is slated for completion in July 2007.
Bombardier wins $260 million in UK contractsFirst Great Western, the UK's leading transport company, has awarded passenger railcar renovation contracts potentially worth $260 million to Bombardier Transportation. A $100 million contract is for refurbishing of 405 high speed train (HST) trailer cars at Bombardier facilities in Derby and Ilford. A second contract, valued at up to $160 million, is for HST bogie overhaul and technical development work, to be carried out at Bombardier’s site in Crewe throughout the 10-year life of the new Great Western franchise.
New fuel surcharges for transoceanic containersShipping lines will raise a planned peak season surcharge of $400 per 40-foot container from Asia to the U.S. East and Gulf coasts to $500 effective July 15 and to $600 from Aug. 15 to Nov. 1. The increased charge will apply to containers moving through the Panama and Suez canals; the planned $400 surcharge for the U.S. West Coast will remain unchanged. The revised charges were recommended by the Transatlantic Stabilization Agreement (TSA) carrier group, which includes 11 lines in trans-Pacific trade.
TSA Executive Director Albert Pierce said the U.S.-Asia route has seen four record years of mostly double-digit growth and that space on vessels is still tight.
The costs of moving containers on land are going up along with costs at sea. TSA has predicted that U. S. inland rail and trucking costs could rise by 25% in 2006, while the cost of returning empty containers to ports could rise by 11%.
RailWorks names new managersRailWorks announced three new appointments to its management team. Ronald L. Smith, who joined RailWorks subsidiary L. K. Comstock & Co. in 1993, has been named President, National Transit, with responsibility for a division that includes all of North America with the exception of the New York City region. Joseph R. Spirito, formerly with Railroad Construction Co., has been named Vice President of Risk Management, a newly formed department. Bill Field, who joined RailWorks in 2001 after 20 years with Conrail, has been promoted to Director of Safety.
OTI wins Israeli smart card contractIsrael’s Ministry of Transportation has awarded a contract to On Track Innovations Ltd. (OTI) of Fort Lee, N.J., to supply contactless smart cards for bus, train, and light rail transportation. Travelers will be able to use one card for payment on multiple public transportation operators throughout the country.
STB plans public forum on “paper barriers” Shippers, railroads, and other interested parties will get an opportunity on July 27 to publicly air their views on “paper barriers.” The Surface transportation Board announced June 5 that it has scheduled a hearing on the contentious issue in response to a renewed petition filed by the Western Coal Traffic League (WCTL).
“WCTL has requested that the STB adopt rules limiting the extent to which agreements for the sale or lease of railroad lines, by larger railroads to existing or newly created short line railroads, may contain paper barriers restricting the incentive or ability of a purchaser or tenant to interchange traffic with connecting railroads that could compete with the seller or landlord railroad,” said STB’s announcement. “The purpose of this hearing is to further explore this topic, to give the STB members the opportunity to ask questions, and to provide a forum for the expression of views by rail shippers, railroads, and other interested persons, on WCTL's renewed petition.”
The board’s decision on the hearing is available at http://www.stb.gov.
ACS wins smart card service center contract in L.A.The Los Angeles County Metropolitan Transportation Authority (Metro) awarded a contract worth up to $60 million to Dallas-based Affiliated Computer Services, Inc. (ACS) to implement and operate a regional smart card service center. The initial five-year contract is for $31.5 million, with two two-year options nearly doubling its total value.
Metro is introducing a regional fare plan that will permit riders to use a single smart card on all bus and rail systems in the Los Angeles area. A Regional Transit Access Pass (TAP) center operated by ACS will be responsible for cardholder registration, card inventory and distribution, and point-of-sale network management.
Operation Lifesaver gets $1.025 million FRA grantThe Federal Railroad Administration announced a grant of $1.025 million to Operation Lifesaver, Inc. for “public awareness and education programs” aimed at reducing railroad grade crossing and trespassing fatalities. FRA noted that as part of the grant agreement, Operation Lifesaver “is required to receive 25% matching in-kind contributions from non-government sources for a total program effort of $1,366,500.”
Railroads report strong first-quarter safety gainsU.S. railroads reported 2,962 accidents and incidents in this year’s first quarter, a decline of 13.4% from the 3,421 reported in the same period last year, according to preliminary statistics released by the Federal Railroad Administration.
Train accidents dropped 26.0% to 626, with collisions down 36.9% to 41 and derailments down 25.4% to 464. Yard accidents declined 26.0% to 347. Fatalities at highway-rail grade crossings were down 8.1% to 79, but trespassing deaths, over which railroads have relatively little control, increased 6.2% to 103. Only two employee fatalities were reported in this years first three months, bringing total fatalities in the period to 184, down 13.2% from last year’s 212.
SouthShore buys coil steel cars from TrinityChicago SouthShore & South Bend (CSS) announced the purchase of 100 new gondola cars from Trinity Industries for coil steel shipments. The order is valued at more than $8 million. Trinity began delivery of the 42-foot, 112-ton-capacity cars in mid-May. The acquisition is part of CSS’s $10 million 2006 capital program. Since it began operations 16 years ago, the railroad has leased or purchased 190 freight cars, primarily for the steel industry.
For UP, another $32.6 million in track upgradesAs part of its $1.5 billion track improvement program for 2006, Union Pacific is now working on upgrades in California, Nebraska, and Iowa.
Between Calexico and Niland, Calif., the railroad recently installed 41,000 new crossties, spread 13,400 tons of ballast, and replaced 58 grade crossing surfaces. By the end of this month, it will complete construction of two walkways along the track at a U.S. Customs and Border Protection inspection site in Calexico. The projects are valued at $4.3 million.
Work began in January on improvements between Fremont and Central City, Neb. UP is spending $22.2 million to install 64,460 concrete ties and 15,000 wooden ties; spread 81,000 tons of ballast; change-out eight grade crossing surfaces; and replace 16 turnouts and 24 miles of tangent and 19,324 feet of curved track by September.
For track between Blairstown and Nevada, Iowa, UP is installing 31,200 ties, spreading 9,300 tons of ballast, and replacing 27 grade crossing surfaces and 53,400 feet of track along various curves. This $6.1 million program, which started in May, will continue through the end of June.
Trimaran Capital to acquire Standard SteelNew York-based Trimaran Capital Partners is acquiring Standard Steel, a wheel and axle manufacturer for freight /passenger railcars and locomotives. The deal is expected to close in this year's second quarter. Details were not disclosed.
Standard Steel's senior managers, including President and CEO Michael Farrell and COO Tom Reinecke, will continue in their current positions and be investors in the transaction.
“We are experienced investors in the railcar industry, having recently exited our successful investment in FreightCar America, and are firm believers in the continuing strength in the demand for railcars and railcar components,” Trimaran Co-founder and Managing Partner Jay Bloom said during today's announcement. "Standard Steel represents an exciting opportunity to invest in a company which has excellent relationships with its customers and is well positioned to capitalize on these industry trends."
Citicorp Mezzanine Partners, L.P., is the current owner of Standard Steel, which generated more than $125 million in revenue in 2005. The company is headquartered in Pittsburgh, Pa., and has a manufacturing facility in Burnham, Pa.
Faiveley Transport USA appoints new vice president-marketingJitendra S. Tomar has been named vice president-marketing and business development for Faiveley Transport USA, based in Exton, Pa. With 20 years of international marketing and business development experience, Tomar served previously as associate director of marketing and business development at Kawasaki Rail Car, Inc., where he was responsible for corporate marketing strategy, public and industry relations, and government affairs. He started his career as an engineer at CIMMCO Ltd. (India).
White House picks Nober's successorPresident Bush intends to nominate Charles D. Nottingham, of Virginia, to be a Member of the Surface Transportation Board and upon confirmation designate Chairman, for the remainder of a five-year term expiring Dec. 31, 2010, to succeed Roger Nober.
Nottingham currently serves as Associate Administrator for Policy and Government Affairs for the Federal Highway Administration. Prior to this, he served as Counsel to the House Committee on Government Reform and the Subcommittee on Technology, Information Policy, Intergovernmental Relations and the Census. Earlier in his career, he served as Commonwealth Transportation Commissioner for the Virginia Department of Transportation.
Minnesota's commuter rail funding on trackMinnesota's first commuter rail project, Northstar, has cleared three more hurdles. The Minnesota Legislature approved $60 million in bonding authority for it late last month, and Governor Tim Pawlenty signed the bill into law today, allowing the state to seek federal matching funds.
The Big Lake-Minneapolis service is estimated to cost $307.3 million. The state's contribution will be 33%, which includes the recent allotment plus $37.5 million provided in 2005 under a separate bonding authority. Local governments along the 40-mile, six-station line are expected cover 17% of the pricetag.
Also last month, the Northstar Corridor Development Authority (NCDA) reached an agreement in principle for construction and operation with the State of Minnesota and BNSF Railway, over whose tracks Northstar will run. NCDA hopes to begin service in 2009.
Trinity to drop Fittings GroupNo longer part of its “core strategy,” Trinity Industries will sell its Fittings Group (TFG) to the TFG management team and investment firm Levine Leichtman Capital Partners. The business, operated in Russellville, Ark., and Enid, Okla., will be renamed Hackney Ladish, Inc., when the deal closes in the next 30 days. Transaction terms were not disclosed.
“The opportunity to sell the business and redeploy the proceeds into the company's other operations is a beneficial course of action at this time,” Trinity's Chairman, President, and CEO Timothy R. Wallace said during today's announcement. Trinity has five main business groups: Rail, Railcar Leasing and Management, Inland Barge, Construction Products, and Energy Equipment.
TFG produces low-temperature, high-yield fittings and hot or cold-forms WPB fittings. Its product line includes Hackney, Ladish, and Flo-Bend.