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CSX is committing $2.3 billion to its core capital plan in 2013. Photo: CSX Railway Age, USPS 449-130, is published monthly by the Simmons-Boardman Publishing Corporation, 55 Broad Street, 26th Fl., New York, NY 10004. Tel. (212) 620-7200; FAX (212) 633-1863. Vol. 214, No. 2. Subscriptions: Railway Age is sent without obligation to professionals working in the railroad industry in the United States, Canada, and Mexico. However, the publisher reserves the right to limit the number copies. Subscriptions should be requested on company letterhead. Subscription pricing to others for Print or Digital only versions: $100.00 per year/$151.00 for two years in the U.S., Canada, and Mexico; $139.00 per year/$197.00 for two years, foreign. Foreign $239.00 (U.S. funds) per year/$397.00 for two years for Air mail delivery. When ordering Both Print and Digital: $150.00 per year/$227.00 for two years in the U.S., Canada, and Mexico; $208.00 per year/$296.00 for two years, foreign. Foreign $308.00 (U.S. funds) per year/$496.00 for two years for Air mail delivery. Single Copies: $36.00 per copy in the U.S., Canada, and Mexico/$128.00 foreign All subscriptions payable in advance. COPYRIGHT© 2013 Simmons-Boardman Publishing Corporation 2012. All rights reserved. Contents may not be reproduced without permission. For reprint information contact PARS International Corp., 102 W. 38th Street, 6th floor, New York, N.Y. 10018, Tel.: 212-221-9595; Fax: 212-221-9195. Periodicals postage paid at New York, NY, and additional mailing offices. Canada Post Cust.#7204564; Agreement #41094515. Bleuchip Int’l, PO Box 25542, London, ON N6C 6B2. Address all subscriptions, change of address forms and correspondence concerning subscriptions to Subscription Dept., Railway Age, P.O. Box 10, Omaha, NE 68101-0010 or call toll free (800) 895-4389. In Nebraska call (402) 346-4740. Printed at Cummings Printing, Hooksett, N.H. ISSN 00338826
February 2013 Railway age 1
RailwayAge
From the Editor william C. Vantuono
Editorial and ExEcutivE officEs Simmons-Boardman Publishing Corp. 55 Broad Street, 26th Fl. New York, NY 10004 212-620-7200; Fax: 212-633-1863 Website: www.railwayage.com
Yes, indeed, brilliant machines
W
hat do a talking 1982 Pontiac Firebird Trans Am from an old TV show and a 2012 General Electric Evolution Series locomotive in Norfolk Southern colors have in common? They’re both painted black—but that’s not the answer. They both “talk,” the Trans Am with a rather sophisticated voice (renowned actor William Daniels), the locomotive with data radio. But that’s only part of the answer. They’re both “Brilliant Machines,” featured together in GE’s newest advertising campaign of the same name. In the Trans-Am’s case (by the way, it’s KITT from the 1982-1986 series “Knight Rider,” starring that hammiest of actors, David Hasselhoff), the brilliance is sciencefictional. The EVO locomotive’s brilliance is anything but. Let’s let KITT himself tell the story, in simple terms that the average American, who knows almost nothing about railroads, can understand:
“You know what’s impressive? A talking car. But I’ll tell you what really impresses me—a talking train. This GE locomotive can tell you exactly where it is, what it’s carrying, while using less fuel—delivering whatever the world needs, when it needs it. After all, what’s the point of talking, if you don’t have something important to say?” As the locomotive, NS no. 8113, speeds out of sight, freight cars in tow, the words “Brilliant Machines are transforming the way we work” appear. Impressive! A very effective way, in my opinion, for GE to market to the millions of consumers who use its products, and perhaps also teach them something about railroads. GE has the advertising bucks to be able to do this, as well as the customer base of general consumers of everything from light bulbs to refrigerators. Now, I need to provide full disclosure here: Many of you know I’m a Pontiac enthusiast—mostly GTOs of any vintage, including my ’04, though I appreciate a mint ’70s Trans Am or ’60s full-size Grand Prix or Bonneville. And yes, I did faithfully watch Knight Rider back in the day—to see KITT in action, not David Hasselhoff’s cleft-chinned, wavy-haired hambone-ish hero. And the sheer pleasure I get from watching a modern locomotive in action, hauling a unit coal train or stack train or whatever, goes without saying. Putting the two together is, at least for me, uniquely satisfying. Let’s hope that GE’s marketing brilliance—pairing a stealthy Trans Am with a flagship from a long-stealthy (i.e. largely invisible to the public) industry, railroading—makes a lasting impression on a public that needs to be educated about what it is we do for them, day in and day out.
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Industry Indicators TRAFFIC ORIGINATED
WEEK 52 enDIng Dec. 29, 2012
carLoaDS
MAJOR U.S. RAILROADS
By COMMODITy grain farm Products ex.grain metallic ores coal crushed Stone / Sand / gravel nonmetallic minerals grain mill Products food & Kindred Products Primary forest Products Lumber & Wood Products Pulp, Paper & other chemicals Petroleum Products Stone, clay & glass coke metals & Products motor Vehicles & equipment Iron & Steel Scrap Waste & nonferrous Scrap all other carloads TOTAL CAR LOADED
CANADIAN RAILROADS ALL COMMODITy
MEXICAN RAILROADS ALL COMMODITy
2012 13,328 500 7,348 87,371 8,818 3,309 8,601 4,799 988 2,089 6,674 26,571 10,441 4,653 3,507 8,792 7,234 2,622 2,115 2,161 211,921
2011 17,751 714 7,674 109,689 10,986 3,718 9,257 5,037 1,192 2,255 6,943 28,674 7,041 5,031 3,073 10,912 6,777 2,891 2,556 3,562 245,733
59,978
66,567
10,307 52 WEEKS 14,682,819 4,009,097 729,024 19,440,940
U.S TOTAL CANADIAN TOTAL MEXICAN TOTAL NORTH AMERICAN TOTAL
% CHANGE -24.9% -30.0% -4.2% -20.3% -19.7% -11.0% -7.1% -4.7% -17.1% -7.4% -3.9% -7.3% 48.3% -7.5% 14.1% -19.4% 6.7% -9.3% -17.3% -39.3% -13.8% -9.9%
10,114 1.9% % CHANGE FROM 2011 -3.1% 2.0% 1.3% -2.0%
WEEK 52 enDIng Dec. 29, 2012
InTermoDaL U.S. RAILROADS TraILerS conTaInerS TOTAL UNIT
CANADIAN RAILROADS TraILerS conTaInerS TOTAL UNIT
MEXICAN RAILROADS TraILerS conTaInerS TOTAL UNIT
18,794 137,006 155,800
24,726 156,505 181,231
-24.0% -12.5% -14.0%
586 34,258 34,844
838 33,913 34,571
-30.1% 1.0% 0.3%
0 6,391 6,391
39 5,690 5,729
-100 % 12.3% 11.6%
52 WEEKS 12,267,336 2,673,314 519,259 15,459,909
U.S TOTAL CANADIAN TOTAL MEXICAN TOTAL NORTH AMERICAN TOTAL
% CHANGE FROM 2011 3.2% 7.1% 19.0% 4.2%
ESTIMATED TON-MILES (BILLIONS), U.S. CLASS I RAILROADS 2012 24.8 1,693.5
WeeK 52 TOTAL WEEK 1-52
2011 28.6 1,735.1
% CHANGE -13.3% -2.4%
Source: Weekly railroad Traffic, association of american railrods
RAIL FREIGHT TRAFFIC TRENDS, U.S. CLASS I RAILROADS estimated billion ton-miles
38
2011
36
34
32
32 30
28
2012
26 24 22
28 26 24
4 8 week
Railway age
22 12 16 20 24 28 32 36 40 44 48 52
February 2013
carLoaDS
ORIGINATED DEC. ’12 41,742 23,577 22,451 12,393 23,532 6,688 8,861 4,464 17,684 9,973 1,372 1,919 16,845 11,231 38,753 10,864 79,853
By COMMODITy chemicals coal crushed Stone / Sand / gravel food & Kindred Products grain grain mill Products Lumber & Wood Products metals ores metals & Products motor Vehicles & equipmet nonmetallic minerals Petroleum Products Pulp, Paper & allied Products Stone, clay & glass Products Trailers / containers Waste & nonferrous Scrap all other carloads
ORIGINATED DEC. ’11 41,580 17,509 20,579 13,254 22,432 7,026 7,537 6,454 21,139 10,312 2,077 1,727 17,533 11,053 34,156 10,075 86,708
% CHANGE 0.4% 34.7% 9.1% -6.5% 4.9% -4.8% 17.6% -30.8% -16.3% -5.2% -33.9% 11.1% -3.9% 1.6% 13.5% -7.8% -7.9%
TOTAL CARLOADS, DECEMBER 2012 vS. 2011 DECEMBER 2012 - 332,002 DECEMBER 2011 - 331,151 270,000 280,000 290,000 300,000 310,000
320,000 330,000 340,000 350,000 360,000
copyright © 2013. all rights reserved.
RAILROAD EMpLOyMENT, CLASS I LINEHAUL CARRIERS, DECEMBER 2012 (% change from DecemBer 2011)
Transportation (train and engine) 65,493 (0.63%)
executives, officials, and Staff assistants 9,875 (4.20%)
Professional and administrative 14,087 (1.69%)
TOTAL EMpLOyEES: 162,652 % CHANGE FROM DEC. 2011: 1.06% Transportation (other than train & engine) 6,766 (0.03%)
maintenance of equipment and Stores 30,172 (1.22%)
maintenanceof-Way and Structures 36,259 (0.83%)
Source: Surface Transportation Board
36
34 30
4
38
SHORT LINE AND REGIONAL TRAFFIC INDEX
Week-ended number
EMpLOyMENT Up yEAR-OvER-yEAR, SLIpS FROM pAST MONTH figures released by the Surface Transportation Board show class I railroads employed 162,652 people in mid-December, up 1.06% from December 2011, and down a modest 0.07% from november 2012. all categories gained year-over-year, with executives, officials and Staff assistants again leading the pack, up 4.20%. Transnportation (other than train and engine) led gainers over november 2012, up 2.17%, while maintenance-of-Way and Structures fell the most, down 2.46%.
A TOGNUM GROUP BRAND
It’s the first to arrive. The global leader in rail technology is proud to introduce another first: the new Series 4000 R54 engine. Certified to meet EPA Tier 3 locomotive emissions standards, it’s the first single engine to provide 2000-plus traction horsepower and meet CARB ULEL emissions standards without exhaust gas aftertreatment. The Series 4000 R54’s environmentally friendly, maintenance-friendly design also features exceptional power—12V and 16V models deliver 2,400 hp and 3,200 hp respectively.
www.mtu-online.com
Industry Outlook BNSF unveils 2013 capital commitment program
BNSF RAILWAY CO. last month announced its 2013 capital commitment program of approximately $4.1 billion, which the railroad said was “approximately a $450 million increase over its 2012 capital spend of $3.6 billion.” The largest component of the capital plan is a projected $2.3 billion
on BNSF’s core network and related assets. BNSF also plans to spend approximately $1 billion on locomotive, freight car,and other equipment acquisitions. The program also includes about $250 million for continued installation of positive train control (PTC), as mandated by Congress, and $550 million for terminal, line, and intermodal expansion and efficiency projects. Many of those projects will be primarily focused on capacity expansion to accommodate Bakken Shale-related industrial products growth in North Dakota, South Dakota, and eastern Montana. intermodal terminal expansion, such as the
completion of BNSF’s Kansas City intermodal Facility, and other terminal improvements to enhance productivity and velocity are also listed. “This record capital plan continues our long-term focus on ensuring our network is prepared for the growing U.S. demand for freight rail,” said BNSF Chairman and CeO Matthew K. Rose. “we are focused on investing to meet our customers’ expectations and to expand capacity where growth is occurring. given the importance of our low cost supply chain to the U.S. economy, our privately funded rail infrastructure is well positioned to ensure the U.S. ability to compete in global markets.”
Valero prepares tank car purchase for crude oil moves
6
Railway age
February 2013
New NS intermodal terminal opens NORFOLK SOUTHERN on Jan. 21 said it has opened its third Crescent Corridor intermodal facility, a $97 million terminal in greencastle, Pa., in the south central portion of the Keystone State. The 200-care Franklin County Regional intermodal Facility will connect central Pennsylvania, western Maryland, and northern Virginia to domestic and world markets, NS said. NS provided $52 million, matched by $45 million from the state of Pennsylvania in a public-private partnership, NS said. “The Crescent Corridor provides tremendous public benefits such as job creation, reduced long-haul truck traffic, and a cleaner, more efficient way to move freight,” Norfolk Southern CeO wick Moorman said. “Opening the Franklin County facility marks a major milestone in this effort. we thank those who have supported our initiatives in Pennsylvania and across our entire Crescent Corridor, folks who recognize how crucial public-private partnerships are to boosting freight railroad transportation, which provides remarkable economic and environmental benefits to our country.” NS says it expects the facility, combined with other NS terminals in the state, to divert as many as 800,000 long-haul trucks in Pennsylvania off roadways and onto trains by 2020.
Norfolk Southern
VALERO ENERGY CORP., billed as the world’s largest independent refiner, plans to purchase 2,000 tank cars to increase shipment of crude oil to inland U.S. locations. The company also plans to invest up to $280 million in building a crude oil “topper,” or specialized skimming device at its Houston refinery, which the railcars would serve. Valero hopes for delivery of the 2000 railcars this year. The supplier was not specified in a Bloomberg report. The Houston plant already can process mostly light-sweet crude, but the crude produced by hydraulic fracturing (fracking) in the prolific eagle Ford shale formation in south Texas is even lighter, Valero spokesman Bill Day said. “This is more like an expansion at the Houston refinery, which will enable us to process even more eagle Ford there,” he said. Valero hopes to begin operating its topper in early 2015. Phillips 66 last June said it planned to buy 2,000 railcars to increase access to inland crude supplies. Phillips also anticipates receiving its tank cars this year.
Discover the World of Vossloh
Rail Infrastructure
Vossloh North America’s Rail Infrastructure division produces components for all types of transport from heavy haul to high-speed. We make rail fasteners, switches, control and monitoring systems for rail networks ranging from light rail to high-speed lines. Plus we provide life-cycle servicing, maintenance and reconditioning and recycling of old rails. Vossloh North America is part of the Vossloh AG Group, one of the world’s leading transportation technology companies. We are internationally known for our extensive rail expertise, innovative answers and leading-edge products. Our rail infrastructure solutions, rail vehicles, and environmental awareness all contribute to providing safe, cost-effective and eco-friendly freight and public transport.
Phone: +1.800.554.0554 info@vossloh-north-america.com www.vossloh-north-america.com
Market Axion gets order from LIRR
North America DART: in conjunction with the Regional Transportation Council, ordered two additional liberty streetcars from Brookville equipment Corp. for the Oak Cliff streetcar line. Brookville already is constructing two streetcars for the line, set to open in October 2014. MBTA: awarded a joint venture, led by aeCOM Technology Corp., a $43 million contract to provide advanced preliminary design services for extending green line light rail service west of Boston’s lechmere loop to Somerville and Medford, Mass. MINNEAPOLIS/ST. PAUL: The Twin Cities (Minn.) Metropolitan Council awarded los angeles-based aeCOM Technology Corp. a $16.8 million contract for preliminary engineering work on the Southwest light Rail Transit project. aeCOM said it will provide services for the western half of the proposed 15.8-mile route, the third planned for the Twin Cities. 8
Railway age
February 2013
PATH: in testimony before the Senate Transportation and Merchant Marine infrastructure Subcommittee, praised work performed by invensys Rail Corp. to restore the bistate rapid transit service, hard hit by Hurricane Sandy in late October. PaTH service still operates at suboptimal levels three months after Hurricane Sandy battered the 13-stop system, flooding and damaging significant portions of infrastructure. But Port authority of New york & New Jersey (Pa) executive Director Patrick J. Foye addressing a Senate subcommittee, noted work by invensys Rail allowed some limited service to resume one week after the storm’s landfall Oct. 29, 2012. NORTHSHORE MINING CO.: Tapped Fairport, N.y.-based RailComm to install the company’s Domain Operations Controller (DOC®) train control system to aid operations on the roughly 47 miles of right-of-way between the company’s raw taconite mine in Babbitt, Minn., and its pellet plant at Silver Bay.
Worldwide GERMAN FEDERAL RAILWAY AUTHORITY: granted Siemens approval for the operation of Vectron locomotives on the german mainline network. HUNGARIAN STATE RAILWAYS: Said Stadler was the sole bidder to supply 48 low-floor electric multiple-unit (eMU) cars, 42 of which will be purchased by regional operator MÁV-Start and six by györ-Sopronebenfurth Railway (gySeV). The bid will be evaluated and, if found valid and within the financial capabilities of the two railways, will be awarded. SUZHOU, CHINA: awarded CSR Nanjing Puzhen Rolling Stock a contract for 18 Flexity 2 vehicles for the first phase of the city’s light rail network. The order is the first won by CSR Puzhen under a 10-year licensing agreement with Bombardier Transportation signed by the two companies last July.
Joseph M. Calisi
axion international Holdings, inc. has received a purchase order from the long island Rail Road for additional ecotrax rail ties, to be used “in various locations throughout long island.” The size of the order was not specified. liRR was seeking specialty ties of up to 31 feet in length. Made from 100% recycled plastic, ties can be built to meet unique sizes and specifications. The liRR order follows testing by the railroad, axion, and engineering and design firm CTl group on axion rail ties used on the liRR’s eastern end, near Montauk, N.y., for more than eight years. Test results found the ties “maintained their structural durability” met or exceeded aReMa standards, and showed no signs of degradation over eight years.
Amtrak: Past, Present, Future
NEW !
NEW !
Professional Railroad Atlas of North America
Wilner, a 40-year experienced rail industry veteran, has drafted rail policy positions as a senior industry official, implemented them as a White House appointed federal regulator, written about them as a journalist, and critiqued them as a rail labor-union officer. Softcover, 238 pages.
Now available new fourth edition. This atlas has been designed for the railroad professional and transportation consultant. Nine major lines are color coded for enhanced readability. A great reference tool. Great care has been taken to provide the most accurate and current information available. Over 40 insets displaying highly detailed maps of metropolitan areas. Also includes map of the "Conrail Merger." From Alaska and the Yukon to the Yucatan in southern Mexico, its all here. The atlas includes a listing of approximately 650 railroad companies and reporting marks in North America. The individually colored lines in the US and Canada are the Burlington Northern Santa Fe, Canadian National, Canadian Pacific, CSX, Kansas City Southern, Norfolk Southern, and Union Pacific.Softcover, 112 pages.
BKAMTRAK
BKATAS
by Frank N. Wilner This book traces the history of passenger-train travel from its heyday to the formation of Amtrak, the government-subsidized railroad created as a for-profit carrier. The book chronicles the roles of Amtrak both as a business and as a public entity dependent on political support. It reviews Congressional and White House policies and strategies that contribute to neither business failu re nor prosperity. It also details the revolving door of Amtrak presidents.
Amtrak: Past, Present, Future
$34.95
Professional Railroad Atlas of North America
$77.95
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Blue Signal Protection (DVD format) • DVBLUE • $195.00
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Update Supply BriefS Ge Transportation marks good 4Q, full-year profit ge Transportation’s fourth-quarter results included $252 million in earnings, or “segment profits,” in the fourth quarter, up 11.5% from $226 million in the comparable 2011 quarter. The company generated $1.4 billion in revenue during the fourth quarter, down 7% from the fourth quarter of 2011. But record full-year revenue of $5.6 billion rose 15% over 2011, with full-year segment profits of $1.0 billion up about 32% from $757 million in 2011. ge Transportation’s fourth-quarter orders totaled $1.3 billion up 7%, while full-year orders of $5.5 billion was up 21% over 2011, the company said. ge Transportation is part of general electric Co.
New technology planned for Alstom Citadis lrVs alstom and williams Hybrid Power announced they have signed an agreement to apply williams Hybrid Power’s energy storage technology to alstom’s Citadis light rail transit (lRT) vehicles by 2014. The two companies will “work together to adapt and develop an energy storage solution that has the potential to reduce the greenhouse gas emissions of alstom’s rolling stock.” Originally developed for the 2009 williams Formula One car, williams Hybrid Power’s energy storage technology has since been introduced into applications such as london buses. The companies say the technology offers fuel savings and emissions reductions by harvesting the energy normally lost as heat when braking. “it is ideally suited to trams [lRT vehicles] because of their stop-start nature and high mass,” the two companies said. 10
Railway age February 2013
Early fourth-quarter earnings show fiscal ups and downs
u
nlike some quarters wherein Class I railroads report earning that are in near lockstep, reports last month from the big North American rail properties showed a divergence of fortunes. Not surprisingly, the decline in coal volumes played a part in the relative disparity, though not an all-encompassing one. Canadian National on Jan. 22 reported fourth-quarter earnings of C$610 million (US$614 million), of C$1.41 per share, up from C$592 million, or C$1.32 a share, in the fourth quarter of 2011. Earnings met Wall Street consensus analyst estimates. Fourth-quarter revenue rose 7% to C$2.53 billion from C$2.38 billion in the year-ago quarter, below expectations of C$2.55 billion but still a record, the company said. CN’s operating ratio improved by 1.1 points to 63.6%, even as operating costs rose 5% during the quarter. Later the same day, Norfolk Southern Corp. reported fourthquarter 2012 net income of $413 million, or $1.30 per diluted share, compared with $480 million, or $1.42 per diluted share, earned in the fourth quarter of 2011. Per-share earnings, however, did beat Wall Street analyst estimates by 11 cents. Net income for full-year 2012 was $1.7 billion, or $5.37 per diluted share, compared
with $1.9 billion, or $5.45 per diluted share, earned in 2011. NS’s fourth-quarter operating revenue of $2.7 billion was down 4% from the comparable quarter in 2011. The company’s 2012 revenue of $11 billion slipped 1% below the 2011 total. NS said its operating ratio “increased 3 percent to 73.4% during the fourth quarter and rose 1% to 71.7% for 2012 compared with the same periods of 2011.” Minutes after Norfolk Southern weighed in, CSX Corp. reported fourth-quarter 2012 net earnings of $443 million, or 43 cents per share, compared with $457 million, or 43 cents per share, in the comparable 2011 quarter. Earnings per share, however, beat Wall Street analyst estimates by four cents. For full-year 2012, net earnings were $1.9 billion, or $1.79 per share, up from $1.8 billion, or $1.67 per share, in 2011. Fourth-quarter revenue of $2.9 billion was down 2% from the comparable quarter in 2011. CSX’s operating ratio increased 60 basis points to 72.1% in the fourth-quarter, but for the full year, the operating ratio improved 30 basis points to 70.6%, CSX said. For both the fourth quarter and the full year, the earnings-per-share performances reflected shares repurchased in 2012, CSX noted.
CP touts new intermodal hub Canadian Pacific announced the opening Jan. 14 of its intermodal Facility at Saskatchewan’s global Transportation Hub (gTH) in Regina, the provincial capital. adjacent to CP’s mainline between Regina and Moose Jaw, the new300-acre facility is designed to increase capacity for intermodal customers with enhanced and more competitive services, and is expected to process up to 250,000 container handlings per year, or five times more container handlings per year when compared with CP’s former Regina terminal. CP is one of several companies locating in the gTH, which encompasses about 1,700 acres of serviced land.
CN, Indiana RR plan intermodal venture CN and the Indiana Rail Road Co. last month announced plans to construct an intermodal terminal in Indianapolis, designed to offer Indiana importers and exporters an all-rail option for containerized products moving to and from Asia. CN serves the Port of Vancouver and the Port of Prince Rupert, both in British Columbia, which handle a wide range of container shipping lines that offer scheduled service from all major Asian ports. “CN is pleased to enter into this partnership with the Indiana Rail Road,” said Jean-Jacques Ruest, CN executive vice-president and chief marketing officer. “This all-rail service will reduce transit times and improve transportation consistency for Indiana importers, making their supply chains more competitive. CN’s level-of-service agreements with the container terminal operators at Vancouver and Prince Rupert deliver superior fluidity from
ship-to-rail at the ports.” “This is a great day for Indianapolisarea importers and exporters who for years have asked for all-rail, direct-west coast intermodal service to the city,” said Tom Hoback, INRD founder, president, and CEO. “CN-INRD intermodal service will offer a more reliable, consistent and environmentally-friendly movement of goods that is less susceptible to costly weather and congestion delays.” The new Indianapolis terminal already is under construction and will be located at INRD’s existing Senate Avenue Terminal, located in downtown Indianapolis, less than a mile from Lucas Oil Stadium. It will be complemented by a container yard and will start receiving empty containers on June 15. An on-site agricultural products containerized export loading facility will be in service at about the same time.
OSHA and BNSF sign employee practices accord The U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) said last month it has signed an accord with BNSF Railway Co., noting “BNSF’s voluntary revision of several personnel policies that OSHA alleged violated the whistleblower provisions of the Federal Railroad Safety Act [FRSA] and dissuaded workers from reporting on-the-job injuries.” FRSA’s Section 20109 protects railroad workers from retaliation for, among other acts, reporting suspected violations of federal laws and regulations related to railroad safety and security, hazardous safety or security conditions, and on-the-job injuries, OSHA said. “Protecting America’s railroad workers who report on-the-job injuries from retaliation is an essential element in OSHA’s mission. This accord makes significant progress toward ensuring that BNSF employees who report injuries do not suffer any adverse
consequences for doing so,” said Assistant Secretary of Labor for Occupational Safety and Health Dr. David Michaels. “It also sets the tone for other railroad employers throughout the U.S. to take steps to ensure that their workers are not harassed, intimidated or terminated, in whole or part, for reporting workplace injuries.” Major terms of the accord include: Changing BNSF’s disciplinary policy so that injuries no longer play a role in determining the length of an employee’s probation following a record suspension for a serious rule violation. As of Aug. 31, 2012, BNSF has reduced the probations of 136 employees who were serving longer probations because they had been injured on-the-job. Eliminating a policy that assigned points to employees who sustained on-the-job injuries. Revising a program that required increased safety counseling and prescribed operations testing so that
work-related injuries will no longer be the basis for enrolling employees in the program. As part of the negotiations leading up to the accord, BNSF removed from the program approximately 400 workers. Instituting a higher level review by BNSF’s upper management and legal department for cases in which an employee who reports an on-duty personal injury is also assessed discipline related to the incident giving rise to the injury. Implementing a training program for BNSF’s managers and labor relations and human resources professionals to educate them about their responsibilities under the FRSA. The training will be incorporated into BNSF’s annual supervisor certification program. Making settlement offers in 36 cases to employees who filed whistleblower complaints with OSHA alleging they were harmed by one or more of the company’s previous policies. February 2013 Railway age 11
Update LIRR eyes two tracks to Ronkonoma
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with one track, if a train becomes disabled or there’s the need for police activity on a train then, unfortunately, every train after that backs up.” Williams was joined by U.S. Sen. Charles Schumer (D-N.Y.) in making the announcement. Ridership has doubled on the
Ronkonkoma branch in the past 25 years, LIRR says. Third-rail electrification was added to the route in December 1987, but numerous attempts to increase track capacity since then have stalled or been deferred. The railroad seeks to complete phase one of the project by 2016.
Joseph M. Calisi
MTA Long Island Rail Road last month said its oft-delayed plans to increase track capacity on its Ronkonkoma Line is back in play. LIRR hopes to double-track 18 miles of the route between Ronkonkoma and Farmingdale, N.Y. An environmental assessment is under way for the project. Public hearings and information sessions also are planned. The Ronkonkoma Branch links the LIRR’s Main Line in Hicksville to points in eastern Long Island, terminating in Greenport, N.Y., on the island’s North Fork. Diesel locomotives protect service east of Ronkonoma, which serves as a transfer point. LIRR President Helena Williams said the double-tracking project would allow “half-hourly service with two tracks” for service to and from Manhattan, noting, “Two tracks are better than one.” She added, “Right now
Big Easy adds new streetcar line before Super Bowl
Minnesota short line railroad objects to Twin Cities southwest LRT plan
New Orleans formally opened its new 1.5-mile Loyola Avenue streetcar line on Jan. 28, seven days before the Baltimore Ravens faced off against the San Francisco 49ers in the Big Easy during Super Bowl LVII Feb. 3. “We’ve been doing test runs for weeks now, and everything is looking good,” a spokesman for the New Orleans Regional Transit Authority said prior to opening the line, which runs along its namesake avenue from Canal Street Union Passenger Terminal, served by Amtrak and local buses, and connecting to the city’s other streetcar lines. The streetcar project cost $52 million, roughly about $7 million over budget due to unexpected construction obstacles, including historical artifacts, RTA said.
Glencoe, Minn.-based Twin Cities and Western Railroad has voiced opposition to a proposed light rail operation serving the southwestern suburbs of Minneapolis/St. Paul. The preferred route identified by Hennepin County would require the short line to reroute existing freight traffic to rights-of-way with a steeper grade and additional curves, in and around St. Louis Park, Minn. St. Louis Park is one of the communities to be served by the Southwest Corridor LRT line, linking Minneapolis with suburban Eden Prairie, Minn. Twin Cities and Western serves rural agricultural markets in Minnesota and South Dakota, and owns at least 146 route-miles of track outright.
A consulting engineer for the s hort line told local media “having an elevated grade in a curve has safety implications for the railroad workers and the general public,” including the increased likelihood of derailments. A spokeswoman for Metro Transit says Met Council and Metro Transit will address concerns stated as part of the preliminary engineering phase the project is now undertaking. Railway Age named the Twin Cities and Western Railroad its 2008 Short Line Railroad of the Year. The railroad in the past has said it was willing to host commuter rail service. But federal safety regulations inhibit the ability of LRT and freight trains to occupy the same right-of-way without temporal separation or other measures.
February 2013 Railway age 13
Update For Dallas, more streetcar right-of-way on tap
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Dallas’s Oak Cliff streetcar line has acquired additional funding for more right-of-way work, per approval last month by the Regional Transportation Council. At stake is $30.87 million set aside for a Dallas Area Rapid Transit (DART) transit connection to Love Field, the city’s older airport. The Council reallocated the funds to extend the streetcar line another 0.7 miles to the Bishops Art District. Still pending is the acquisition of two additional Liberty streetcars from Brookville Equipment Corp. Brookville Equipment, aggressively moving into the expanding U.S. market for modern streetcars, already
is constructing two streetcars for the line, set to open in October 2014. Of the $30.87 million, about $8 million would be allocated to preliminary work for another addition, extending the streetcar from Dallas Union Station to the city’s convention center, part of a long-term plan to expand rail transit options in downtown Dallas, complementing existing DART LRT service, sometimes criticized for lacking adequate frequency to serve downtown at peak hours. Work on the initial 1.5-mile portion of the line, linking Union Station and Methodist Dallas Medical Center, is slated to begin next month. The North Central Texas Council of Governments made the formal proposal to the Regional Transportation Council, despite protests from some Dallas citizens saying a DART LRT spur line linking Love Field to the DART LRT system is more of a priority. The Oak Cliff streetcar plan has been politically driven by grassroots Oak Cliff neighborhood organizations, as well as the Oak Cliffs Chamber of Commerce, with DART providing some assistance. DART will operate and maintain the streetcar line.
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Update: Watching Washington FRank n. wilneR
New year, new Congress, regulatory threats Art same Dec 2012:Layout 1 12/27/12 1:34 PM Page
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While doubtful freight rail lobbyists will reveal their reason for broad smiles, the reality is that the makeup of the new Congress and the railroads’ ability to recite a catalogue of success stories since economic regulatory constraints were eased portend legislative triumph. Don’t assume, however, that railroads are facing a batting order of middling hitters. The actuality is that railroad
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legislative success in the 113th Congress will require determination, exertion and attention to detail. With 84 new House members and 11 new senators (some 18% of total congressional seats), education of new members is paramount. And there remain pesky nemeses. The foremost challenge—as it has been for a three decades—is to blunt an assault on the Staggers Rail Act of 1980 by shippers asserting limited transportation options. For sure, the perennial attack on the Staggers Act—which partially eased economic regulation of freight rates— will arrive as surely as buzzards returning to Hinckley, Ohio, in March. Presume that assault will be launched in the Senate, with the strongest redoubts to be found in the House. As in the past, a winning strategy requires compelling evidence on how capital investment, capacity expansion and service enhancements will be mugged—to the detriment of the economy, job creation, and productivity growth—should Staggers Act freedoms be diluted. In the Senate, Commerce Committee Chairman Jay Rockefeller (D-W.Va.), long the captive shipper standard bearer, announced his intended retirement in 2014, but despite his lame-duck status, he will still advance legislation to reverse prior STB regulatory decisions and instruct STB to be more responsive to captive-shipper demands.
ASLRRA President Search The American Short Line and Regional Railroad Association is seeking applicants for the position of President. The ASLRRA is a non-profit trade association that represents the interests of its 450 short line and regional railroad members in federal legislative and regulatory matters. The President is responsible for providing strategic and operational leadership for the ASLRRA by working with its Board of Directors, Executive Committee, Committees, Contract Organizations, and staff to establish and pursue long-range goals, strategies, plans and policies. This is a contracted position with headquarters in Washington D.C. and requires up to 75% travel. A masters degree is preferred with a minimum of 10 years management/leadership experience. A complete job description can be found at www. aslrra.org. Letters of interest and resumes must be submitted by March 1, 2013, 12 noon EST to aslrrasearch@gmail.com.
February 2013 Railway age 15
Update: Watching Washington A second captive shipper advocate, former Antitrust Subcommittee Chairman Herb Kohl (D), also has retired, but others will introduce similar legislation to increase antitrust penalties against railroads and permit states attorneys-general and private parties to bring before federal courts rate and routing complaints clothed as antitrust actions. These include Minnesota Democratic Senators Amy Klobuchar and Al Franken. Klobuchar now chairs the Antitrust Subcommittee and is a member of the Commerce and Agriculture committees (the latter having interest in grain transport rates), while Franken is a member of the Judiciary (antitrust) and Energy committees (the latter with an interest in Pacific Northwest export coal-terminal expansion and oil transport by rail). The Staggers Act assault has never been a straight line through the Senate Commerce Committee. Another captive shipper supporter is Senate Commerce Committee member and Republican John Thune, whose constituents include grain shippers, ethanol producers and coal-using electric utilities. Gone is Sen. Kay Bailey Hutchison (R-Tex.), who retired. Although she previously co-sponsored Rockefeller’s captive shipper legislation, her participation forced Rockefeller to soften his early draft. Hutchison’s former chief of staff is BNSF lobbyist Amy Hawkins. While Rockefeller has yet to gain a Senate floor vote for his legislation, he does not lack other tools, such as
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confirmation hearings for STB nominees. STB watchers note a slight captive-shipper tilt at the STB following previous Rockefeller-chaired confirmation hearings. Self-preservation is a powerful motivator. Regardless of what transpires legislatively in the Senate, companion legislation must be passed by the Republicancontrolled House, and here is where freight railroads shepherd strength, especially on the Transportation & Infrastructure (T&I) and Judiciary committees. Bob Goodlatte, whose district includes railroad stronghold Roanoke, Va., chairs the latter. Instructive is a letter to the STB signed previously by new T&I Committee Chairman Bill Shuster (R-Pa.), ranking Democrat Nick Rahall (W.Va.), Rail Subcommittee ranking Democrat Corrine Brown (Fla.), and former T&I Chairman John Mica (R-Fla.), who remains on the T&I committee and also sits on the Rail Subcommittee: “Any policy changes made by the STB that restrict the railroads’ abilities to invest, grow their networks, and meet the nation’s freight transportation demands will be opposed.” The new chair of the T&I Committee’s Rail Subcommittee, Jeff Denham (R-Calif.), is a free-market champion and seen a solid supporter of Staggers Act freedoms. The new Congress will keep rail lobbyists fully employed, sleep deprived, and needing to be at the top of their game.
Perspective: Short Line & Regional RichaRd F. timmons
Challenges met, challenges ahead on the Hill
T
he 112th Congress was a long march for the short line railroad industry; at the end, we succeeded through the enormous commitment of short line railroaders and the rail supply and contracting industry, who took on two big challenges. Challenge No. 1 was a pro big-truck lobby, stronger and better organized than at any time in recent memory. It secured the support of the chairman of the House Transportation & Infrastructure Committee (T&I), which included a provision for bigger trucks in legislation that would reauthorize the so-called SAFETEA-LU surface transportation bill. The railroad industry mobilized behind an amendment by Rep. Lou Barletta (R-Pa.) to substitute a two-year study for the bigger truck provision. In a rare and highly charged full Committee roll call vote, the Barletta amendment was approved, 33 to 22. The Department of Transportation will conduct the study and consider such factors as safety, highway repair costs and freight diversion; the study is to be completed this October. We do not expect another vote in 2013, but those supporting bigger trucks will be working hard to influence both the DOT study and the new 113th Congress in the hopes of a 2014 rematch. Of our 33 T&I votes, nine departed through electoral defeat or retirement in 2012. The big truck supporters lost only three of their 22 votes. Challenge No. 2 was the extension of the short line rehabilitation tax credit (45G). The credit expired at the end of 2011, and the new extension was retroactive for 2012 and good through the end of 2013. The extension was secured, both literally and figuratively at the 11th hour, as part of the “fiscal cliff ” compromise reached on January 1, 2013. The vote was taken in the 11th hour, but the work
done by the short line railroad industry was done over a two-year period. We dealt with a Congress with more than 80 freshman Republicans anxious to overhaul the entire tax code; increasing gridlock between a Democratic Senate and a Republican House; and a Presidential election overshadowing every legislative issue. In the end, we
Railroad Day on Capitol Hill is the most important lobbying day of the year for the railroad industry. secured more cosponsors, more evenly divided by party, than almost any other tax bill introduced in the 112th Congress–255 in the House and 51 in the Senate. We were blessed with four strong lead sponsors from the tax committees: Sens. Rockefeller (D-W.Va.) and Crapo (R-Idaho); and Reps. Jenkins (R-Kan.) and Blumenauer (D-Ore). The battle to secure an extension beyond 2013 starts now. March 14, 2013, is Railroad Day on Capitol Hill. This is the most important lobbying day of the year for the railroad industry and we need as many participants as possible. The demands on a congressman’s time are increasing; more and more representatives will not grant us a Railroad Day meeting if we do not have at least one constituent from their district included. These face-to-face meetings are the most effective way to tell our story; I encourage every short line and rail supplier to send at least one representative.
The Rail Safety Act of 2008 (RSIA) expires in 2013 and the House T&I Committee will either have to write a new bill or, if unable to reach agreement, simply extend the current law for a temporary period of time. Regardless of the course taken, the RSIA is a source of burdensome regulations, expensive to comply with and often have little to do with improving safety. Those who are in the business of operating railroads in the real world must help Congress understand what is needed and what is not. Rep. Bill Shuster (R-Pa.) will become the new chairman of the House T&I Committee in the 113th Congress. Congressman Shuster is a longtime supporter of our industry. He was most recently the chairman of the Committee’s Railroad Subcommittee and he was the lead T&I sponsor of the short line tax credit legislation. One of his very first public appearances as chairman was at an early January joint meeting of the ASLRRA and the National Railroad Contractors Association (NRC). We look forward to his stewardship of the Committee where so much of our legislative business is conducted. 2013 is the ASLRRA’s 100th anniversary. We will hold our annual convention in Atlanta where 22 short line railroads first formed the Association, originally to address a federal legislative issue, namely the pay that short lines received for delivering the mail. The short lines secured a solution to that problem and for the next 100 hundred years addressed challenges no less daunting than those we faced in the 112th Congress. We look forward to celebrating that 100 years in April and we hope all will join us in that celebration. Richard F.Timmons is president of the American Short Line and Regional Railroad Association. February 2013 Railway age 17
csX’s capeX strategy
From intermodal infrastructure to double-stack clearances to new locomotives, CSX continues to invest. By ROy H. BlaNCHaRD, Contributing editor
“I
t starts wIth the customer.” That’s Core Value No. 1 at CSX, and the capital expenditure plan for 2013 is built precisely to support still greater transportation value for the customer. The core capital plan of $2.3 billion remains at 16%-to-17% of revenue with 54% to infrastructure — track, signals, shops, yards, e.g — to support and sustain the high levels of service and customer satisfaction that have come to characterize CSX over the past few years. Another 12% of the 2013 capex budget (down from 24% in 2012) is for newer, better, more efficient locomotives and cars, continuing a process begun some years ago. What CSX calls “strategic investments” are chiefly designed to meet the growing demand for truck-competitive intermodal service (in 2012 CSX moved 2.3 million units, up 14% from 2009) such as double-stack clearing the core route in western Pennsylvania and the new intermodal terminals in Ohio. These investments will represent 17% of the 2013 capex budget, up from 12% in 2012. PTC will take 14% of 2013’s capex dollars, some $325 million, up from 12% of the 2012 capex plan’s $270 million,
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a year-over-year increase of 20% and the largest percentage increase of any capex category. Chief Financial Officer Frederick Eliasson says another $800 million is slated for PTC beyond 2013, bringing the total PTC investment to $1.7 billion. Earnings from continuing operations grew at a nominal compound annual growth rate of 38% between 2003 and 2012 even as the number of employees declined at an annual 2% compound rate. Since 2003, the firm has grown faster than the economy and done it while decreasing the number of employees. And there’s no sign of letting up. CSX has ramped up its capital expense plans by a whopping 64% in the 2009-2013 period. Four years ago, capex was a mere $1.4 billion, slightly more than 15% of revenues, including PTC (what CFO Eliasson calls a “1.7 billion capex overlay.”). At the same time, CSX increased revenue by a third, dropped the operating ratio to 70.6 from 74.9, and has reduced the Personal Injury ratio by 43% to 0.69 injuries per 200,000 hours worked, a record low. Clearly CSX is adding customer value — safely — and Railway Age wanted to know how the trend will continue in 2013.
In an interview at his Jacksonville, Fla., office, CSX President and CEO Michael Ward discussed how the capex program “starts with the customer.”
How do you ensure the operating disciplines of the core network make it to the local network? waRd: To begin with, local crews have a lot of incentive to provide good service. They interact with their customers on Railway age: How does the capital program adds value to the loading docks, in church, on ball fields, and in the the transportation product? community and quite naturally want to be proud of what waRd: We’ve been spending consistently on the track structhey’re doing. Having happy customers is best job security ture — some $700 million-to-$800 million a year — as our they could ever have. So it’s not a matter of convincing trainvolumes grow because having good track makes a huge and-engine crews about anything. Cindy’s approach is to difference in the service you can provide. It’s a fact of life in build a strong service culture on their own passion for the the railroad business that failures on one place cascade down work, very much the same way we’ve built a safety culture through the system to cause service failures elsewhere. We that’s created the best safety record in the history of CSX. Ra: How do you measure local service performance? have more reliable power, nearly eliminating line-of-road waRd: Our Industrial Switching Excellence (ISE) tool has failures. We’re getting a handle on equipment failures, startshown that, properly applied, we can serve more customers ing with an aggressive wheel-replacement program. Ra: The “One Plan” has now been in place for several years. more often without increasing the number of assets employed. What’s been learned from the process and how has it help Just as the One Plan makes core trains run the same way every mold your plans for future investments of time and money? day — no “audibles,” please — the TSI merchandise model is waRd: Implementing the One Plan was the best thing we proving out the same theme.You start out with The Plan, only ever did. It enforces the discipline we in local service The Plan is the crew need to run the right trains the right work order, and the ISE metric is really “Critics said One Plan a work order compliance tool. Does way. Before the One Plan, local operating decisions may have helped lower crew do the work on the work order? would add cost, short-term local variable expense but Yes or no, complete or a service failure. they didn’t always contribute to our But what if car is not on the work but we found overall goal of keeping the system fluid. order? That’s just as much an ISE failYou may save a train start but you get ure, so we’re changing the metrics to it actually power and crews out of position for the make sure that cars that are supposed takes out cost.” next move. It’s another example of how to be on the work order actually are on something not done right in one place can cause a cascading effect in other places across the system. We insist our local operating managers Run to Plan. Then we can measure plan compliance and take remedial action. Trains running too short? Then we have a bad plan and we’ll fix it. That’s why we run to the plan — no ad hoc local decisions. And you know what? Critics said One Plan would add cost but we’ve found it actually takes out cost. Ra: How does Running to Plan add customer value? waRd: Running to Plan gives the customers what they want: be here when you say you’ll be here and tell us if you can’t. You may recall the big push we had for our Total Service Integration (TSI) plan for the intermodal and unit trains. We wanted to get to the ideal train configuration — power, OD pairs, crews, track time and so on. And by doing so we become a more efficient railroad with more tons per car and more cars per train — the Holy Grail of railroading — solving the inherent challenges of the merchandise or batch network. Now we’re rolling TSI out to the merchandise network. Our VP Transportation, Cindy Sanborn, is heading up the project and is perfect for the job. She’s probably the most customerfocused chief transportation officer I’ve ever seen. She has no qualms about asking the hard questions; they all boil down to, “How do we make that batch network run better?” Ra: The batch network of core trains between serving yards still becomes very truck-like and more custom than batch in the first-mile, last-mile gathering and distribution network. February 2013 Railway age 19
CSX’S CapeX StRategy
it. The customer doesn’t like to see cars that are supposed to be at his place still in the yard, and that’s worse than having the road train a day late. Conversely if they load it, release it and we don’t come and get it, it’s a failure. Some things harder to get right than others. Take car ordering. One at a time with a day’s notice is easy. But if the customer wants five cars a day, he wants exactly that. Used to be, we’d give him 25 in a sequence like 5-0-10-9-1 and score ourselves as meeting the order. Wrong. Not getting five a day messes up the customer’s supply chain operation and negatively impacts his customers. So the ISE tools measures how well we do what we commit to. Running to Plan, whether in local merchandise service or in over-theroad core trains, is paying paying big dividends in lower per-unit variable costs and lower fixed costs. Running to Plan gives us a better product to sell, thereby increasing revenue-unit volumes and revenue, thereby lowering the operating ratio. ra: As you increase revenue-unit volumes, cars-on-line will go up. You’ve said in the past that CSX works best in the 185,000 to 190,000 range. Where are you now and how far can you go without clogging up the railroad? ward: We’ve been running comfortably in the 185s late in the 2012 fourth quarter, occasionally pushing the envelope into the 190s. We could begin to get clogged up at the 230-240 range but we have a lot of room between here and there. I have to say that we’ve easily run well in the 220s. The
secret is running a high percentage of on-time departures simply because the largest single cause of late arrivals is — wait for it — late departures. We’re right running at 90% on-time departures, and on-time is on-time. There is no slack: 1700 hours is 1700 hours. Back in the day when we measured to a two hour window, people ran to that. And we soon found that making the measure on time plus two adds about ten points to the operating ratio. That’s why on-time is on time. To the minute. ra: You said during the Q&A following the third quarter 2012 earnings call that spending money in slow times pays off in good. What did you mean by that? ward: Used to be that when business was down you laid off people and cut capex. That’s flat wrong. it’s easier to hire the right people and rebuild your railroad in slow times. There is less competition for the right hires, there is less pressure on suppliers to get the top dollar for everything and there’s less competition for track time. But if you slack off in bad times it’s tough to play catch-up when business starts coming back and the railroad starts filling up. So we’re doing what we can while we can and that gives us the dollars to fund the needed capex programs the next time volumes head south. That’s one reason we’re putting something north of $2 billion today into the railroad, up from a mere $900 million not that long ago.
ptc mandate drIves c&s Investment posItIve traIn control (PTC) largely dominates Communications and Signaling investment as Class I railroads work to meet a federal mandate. Frank Lonegro, vice president-Mechanical at CSX, oversees the company’s implementation of the PTC initiative. It is major in scope: installing PTC on 3,600 locomotives, installing communications systems specifically designed for the PTC platform, making wayside signals of varying vintages PTC-compatible, and assuring interoperability with every other PTC-equipped railroad in North America. raIlway age: You’re
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Source: CSX
really having to design the whole thing from scratch because nobody’s ever had anything like this on their systems. Where do you begin? FranK lonegro: FRA (the Federal Railroad Administration) requires PTC systems to be interoperable, so we’re working as an industry to develop the standards and
requirements for the system. We’re really having to establish the standards as we go. There is an interoperable Train Control Committee (ITC) that is charged with developing the system’s specifications. One of the challenges is to get consensus among roads that may have unique aspects to their operations. Having said that, the level of collaboration between roads on PTC is unprecedented for our industry. The PTC initiative has many components: the pure software and hardware technology on locomotives, along the wayside, and in the office, the supporting geographic information systems (GIS) and the communications networks and devices to make sure it all works together. While we are developing one system, each road’s operations, dispatch systems, locomotives, signal systems, and MIS infrastructures are different. So we’ll be testing the system independently in our own environments, and then testing interoperability with the other roads. We need to make sure our PTC system covers not
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Intermodal Age the new
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conference & expo
interModaL is the fastest-growing form of surface freight transportation.
april 2–3, 2013 Hyatt regency BaLtiMore on tHe inner HarBor
Join Marine Log and raiLway age in Baltimore for a special conference exploring the multi-modal approach to moving cargo efficiently—by rail, by ship, by truck. ConferenCe topiCs • • • •
Securing and tracking cargo Improving efficiency through technology Managing the national equipment pool Labor’s critical role
• • • •
Successful public-private partnerships Panama Canal expansion Government policies that need to change Improving infrastructure: federal grants
exhibit and sponsorship opportunities Contact Jane Poterala, Conference Director, at tel. 212-620-7209 or jpoterala@sbpub.com
marinelog.com/events
railwayage.com/conferences
Tuesday, april 2
Wednesday, april 3
Continental breakfast | Sponsorship available | Expo open
Continental breakfast | Sponsorship available | Expo open
Keynote address
Keynote address
◆ MaP-21 and the implementation of a national freight policy Randolph Resor, Policy Advisor, Office of the Undersecretary for Transportation Policy, U.S. DOT
◆ Managing the national equipment pool ◆ environmental benefits of intermodal transport Coffee break | Sponsorship available | Expo open
Coffee break | Sponsorship available | Expo open ◆ What grants are available to improve infrastructure? ◆ Panel presentations: successful public-private partnerships
◆ Why we need more federal and state investment in intermodal connections Luncheon | Sponsorship available | Expo open
◆ What critical role can labor play in the new intermodal age?
◆ Panel presentations: What’s the impact of the Panama Canal expansion? Richard Powers, Director of Sales & Marketing, Maryland Port Administration Speaker from the U.S. Maritime Administration
◆ How is technology improving intermodal efficiency?
◆ Building the new Intermodal age: What’s ahead?
Luncheon | Sponsorship available | Expo open
Energy break | Sponsorship available | Expo open
Program subject to change
◆ Panel presentations: securing the supply chain Moderator: Mark A. Carolla, LCDR, U.S. Navy Reserve (Ret.)
Cocktail reception | Sponsorship available | Expo open
Sponsorships & exhibits available. Jane Poterala, Conference Director T: (212) 620-7209 | E: jpoterala@sbpub.com
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CONFERENCE FEE: The registration fee for this event includes admission to all conference sessions and social functions, as well as conference documentation containing all available presentations (sent via email post-event). Registration confirmation and invoice will be emailed. CANCELLATION POLICY: Confirmed registrants canceling less than a week prior to the start of the event are subject to a $250 service charge. Registrants who fail to attend are liable for the entire fee unless they notify Simmons-Boardman in writing via email or fax prior to the event. HOTEL: The Hyatt Regency Baltimore on the Inner Harbor is located at 300 Light St., Baltimore, MD, 21202. The Hyatt has set aside a block of rooms at $179.00 single/double for our attendees. These will be held until 30 days prior to the conference. Please contact the hotel directly at (410) 528-1234 for room reservations, group code “MMIS.” Reservations will be confirmed by the hotel. I’d like a complimentary subscription. (Publisher reserves right to limit numbers.) Marine Log Magazine Marine Log Daily News
Railway Age Magazine Rail Group News Daily
CSX’S CapeX StRategy
only our railroad but also can communicate seamlessly with our direct rail connections. ra: Can you give an example? Locomotives, for example, where we have EMD, GE, Caterpillar, Brookeville, and even Alco as extant brand names, multiplied by the many styles and types from each. lonegro: Locomotives are a good place to start. We’re equipping 90% of the fleet — say 3,600 locomotives — for PTC, as the remaining 10% stay exclusively in yard service and generally won’t get out on our PTC line segments. We partially provisioned 800 units last year, will do another 800 in 2013, and the balance over the next two years. Last year we had to be nimble because not all the components we needed were available. So we did “provisional installations” that get all the pre-wiring, antennas, and mounting brackets installed. This is the most labor-intensive part. We know what connections the PTC system will have and what it needs to plug into on the loco. We’re working with schematics for some 20 different locomotive classes, and then there are variations within each class. PTC braking control system, not a throttle-control system. The PTC onboard hardware and software can cost $50,000-to-$100,000 per unit, broadly speaking. Newer microprocessor engines cost slightly less to equip and older non-microprocessor units can easily cost more to retrofit for PTC than the locomotive is worth on the resale market. ra: What about wayside signals? On CSX you have some older electromechanical signal systems installed on predecessor roads maybe 60 or more years ago as well as the latest microprocessor systems. How do you bring that wide spread of technology into the 21st century? lonegro: We have maybe 6,000-to7,000 track miles with older non-microprocessor systems designed 24
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CSX’s PTC initiative “has many components,” including the software and hardware “in the office,” says Lonegro.
and built way before anything as advanced as PTC was conceived. Newer is cheaper in terms of hardware and software, installation and testing. For newer equipment, it is plug and play; for older equipment, you have to essentially replace everything: all the wiring, relays and even sometimes the bungalow and connections to the track circuits.. Then of course we have to retrain the signal maintainers on the new technology. Wayside infrastructure improvements will represent more than half the $1.7 billion CSX will invest in PTC. We’ve done more than 25% to date, with the rest to come at an accelerating rate. ra: Once you get the locomotives and waysides equipped, what’s next? lonegro: Communications is next. The FRA requirement is for all the railroads’ systems to be interoperable, so, for example, CSX locomotives have to be able to talk to Union Pacific PTC wayside systems. The 220 MHz radio will be standard so essentially every Class I road locomotive running in the United States— and every PTC wayside installation - needs one. The railroad industry is in the process of acquiring the radio spectrum and building out base stations with an element of redundancy. Two companies are taking the lead. PTC 220, LLC, is a new venture owned by the seven Class Is to acquire and allocate radio spectrum. The second company is
Meteorcomm, a Seattle-based company, owned by BNSF, CSX, NS, and UP , that is developing the radios and communications system software for railroad interoperability. ra: OK. You have the plan to get the locos wired, the base stations set up and the waysides all talking to everybody. Tell me more about this new PTC technology. lonegro: Wabtec is designing the hardware and software for the train management computers themselves. There’s also a back office system that acts as a hub and translator between each railroad’s unique dispatching and MIS infrastructure. All of this is unfortunately still in development and we’ve identified new challenges through the development process. For example, seemingly basic operations like dispatching systems must be reconfigured to provide the level of granularity PTC needs — where the requisite levels run into the thousandths of a mile or roughly seven feet. That’s because, as I mentioned earlier, PTC is a braking control system and as such needs to know nearly exactly where the operating authority runs out and where the train needs to start braking before it encroaches on the next authority. And so we’re remapping the entire railroad to that level of precision and developing processes to keep track of field asset changes going forward. ra: From what you’ve said, I gather you have four phases of the project running simultaneously: locomotive, wayside and office hardware and software, GIS mapping, the communications component and testing everything as you go. Can you get everything done by the Dec. 31, 2015 deadline set by Congress in the Railway Safety Improvement Act passed in late 2008? lonegro: The FRA published its PTC Final Rule in January 2010, some 15 months after the legislation, and it’s not yet final, to be honest. There have been two additional Notices of
Proposed Rule Making, the most recent in December 2012, so we probably won’t see the truly final rule until the end of this year, a full five years after the legislation itself.
At the start of 2012, the industry submitted a PTC Status Paper to FRA that stated the nationwide PTC network would not be completed by 2015. Despite that, we are proceeding
with all due haste to get systems developed, tested and installed across our network. We want to ensure that we do this safely and without an undesirable impact on the operation. We have a
InFrastructure and asset utIlIzatIon csX chIeF operatIons oFFIcer oscar munoz says the railroad’s
capital program for 2013 is, at the foundation, all about the ongoing adjustments to resource allocation necessary to meet the customer’s rail transportation needs.
raIlway age: You talk about asset utilization, network fluidity, and the dynamic business environment. How do these factors affect the 2013 capex program in terms of locomotives, track structure, and train control? oscar munoz: We must provide the service levels that our customers require and deploy resources commensurate with revenue-unit volumes even as we take out variable costs. A nimble and flexible operation can achieve the balance we need to address customer supply-chain requirements, build on our market strengths, and do what our investors expect of us. Additionally, the CSX Enterprise Asset Management initiative focuses on improving asset utilization. The more we can use the assets we have, the fewer new ones we need to buy. Keeping the network fluid is essential because consistent, reliable service reduces the number of assets needs, and thus capital demands, of running the railroad. And we’re strengthening our track infrastructure through regular repair augmented by a rigorous inspection and testing program to ensure safe, reliable service delivery. ra: In other words, a strong service product drives long-term value for customers. Can you provide any specific expenditures that facilitate the “strong service” product? munoz: Excessive overtime is a killer;
root-cause analysis can often suggest a plan or execution defect, as we discovered last year when we exceeded expectations for Operating to Plan. Money spent to maintaining proper resource levels and a safe, reliable track structure is another contributor to a strong service product. Here are four examples of what we’ve done: 1. The Joint Wayside Detection System gets us better asset utilization and train velocity by identifying equipment health issues before they can cause over-the-road service failures.
2. The
Intermodal Terminal Operating System that increases terminal capacity by using our wide-span cranes to stack containers not ready for immediate movement beyond. 3. The Advance Planning Tool for trackmaintenance windows, giving us better control over MOW crews’ track-time, reducing slow orders and keeping trains moving non-stop through work zones. 4. Our Crew Availability System and Crew Balancing tools that proactively manage T&E crew availability and deployment.
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February 2013 Railway age 25
CSX’S CapeX StRategy ra: Superior service levels, asset utilization, reduced overtime, and improved fuel efficiency are all interrelated. How have past capex programs made these savings come about and what are your expectations for the 2013 capex program? munoz: This is, as you know, an assetintensive business in which investments must be made regularly to accommodate growth and to assure recoverability. Since 2004, CSX has invested consistently to build a premier network. Reliability is a key factor in achieving productivity: trains that run on time consume less fuel, meet budgeted crew expenses and, most important, deliver freight to customers on time. Higher productivity lets us direct capex investments to building the revenue base rather than acquiring surplus asset levels to account for unplanned needs. At the same time, it’s important to build in proper recoverability levels
since weather and other events are always a part of railroad operations. Finally, we’re investing in new technology that helps sustain higher service levels with fewer resources. The newer locomotives in our fleet are more fuelefficient and many have on-board technologies that help the engineer
“We have been purchasing new locomotives for years, and those acquistions will continue.” optimize the throttle position to match the grade and curvature of the track as well as the makeup of the consist. We’re also moving to higher-capacity rail cars so we can move more tonnage with the same number of train-starts. ra: Gross ton-miles per gallon on CSX have increased 5% during the past five
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years even as fuel costs are up 47% in the same period. What locomotive types are your best performers and are any more on your 2013 shopping list? munoz: Our newest locomotives, regardless of brand name, are the best fuel-efficiency and tractive-effort performers. We have been purchasing new locomotives for several years and those acquisitions will continue. Meanwhile, we’re putting those units that have higher rates of fuel burn and require more maintenance per GTM — mainly older six-axle power — in storage yet deployable on short-notice as business levels dictate. ra. Over coffee we were talking about how you’re switching customers more frequently and improving car cycle time, yet, in the next breath, you said you’re going to longer trains. Seems contradictory. How is increased customer switch frequency affecting capital spending on rail cars? munoz: You make a good point, and as you know, railroading can be logically contradictory! Faster rail car turns at the customer create better asset utilization, whether the rail cars are CSX- owned or customer-owned. In either case, more frequent switching can reduce railcar investment capital, improve customer satisfaction and generate growth. Likewise, longer trains operating between serving terminals improve fuel efficiency while at the same time getting us better car, locomotive and crew utilization. It’s actually a logical approach to getting the best efficiencies across the board. ra. How is increased switching frequency affecting safety? How does the capex program create a safer switching environment even as injury exposure increases? munoz: Safety is, when you come right down to it, all about doing the work in a prescribed manner. The CSX safety record continues to improve at best-ever levels—the Personal Injury rate in the fourth quarter of 2012 dropped to 0.54 injuries per 200,000 hours worked from 0.70 in the third quarter, an outstanding accomplishment by our employees.
Clearance issues are being addressed to facilitate CSX’s National Gateway initiative, which will facilitatedoublestack freight traffic and bolster intermodal capacity.
The capital program contributes to a harder infrastructure and to the technology that can help us identify safety issues— rail car, locomotive or track— before they become problems. Recall my previous mention of Joint Wayside Detection System, for example. The bottom line is safety is our number one priority. RA. Regarding track and signal, where are you adding, taking out, and lengthening passing sidings. and why? Are they being rebuilt with faster turnouts? Are you increasing the number of controlled sidings or leaving them dark? What determines your actions here? MUNOZ: CSX is adding and lengthening passing sidings in its high-traffic growth areas. The additional siding capacity lets us handle more revenue units and at the same time maintain aggressive service levels. We are also increasing the number of controlled sidings and adding faster turnouts in many key areas for the same reason. We have reduced slow orders dramatically, a key contributor to our much-improved service metrics. Consistent investments in our infrastructure and regular, planned maintenance all are important factors in keeping slow orders at a minimum. Our goal is to continue to drive down slow orders, which improves asset utilization and customer satisfaction. We are constantly searching for better solutions, whether they are new products, new services, or new processes. In the case of crossties, we are working to identify and incorporate new products, such as plastic composite ties. We also are evaluating wood ties treated with borate and copper napthenate as alternatives to creosote. We will continue to evaluate those ties to ensure that they have the proper durability and life cycle. RA February 2013 Railway age 27
AmtrAk, CAliforniA, And frA teAm up for new HSr geAr
C 28
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Northeast Corridor, and 27 for the Golden State’s nascent intrastate HSR network, set to begin initial construction in the Central Valley this spring. A Request for Proposal could be issued by this September, with an order placed during 2014, according to Amtrak. The move prompted widespread speculation over its origins. Industry media, including Trains magazine (which broke the story) and Railway Age, offered after-the-fact analysis and commentary. FRA’s Szabo, in an interview with Railway Age, didn’t dismiss such analysis, but stated emphatically that one player in the arranged marriage had been overlooked: the FRA itself. “There’s a missed story here; many in the industry didn’t
Amtrak
aught by relative surprise, many rail advocates and industry observers tried hard to appear blase at the news, formally announced Jan. 17, that Amtrak and the state of California would combine forces to order next-generation high speed rail rolling stock. It’s a potentially substantial order for one of nine international equipment suppliers of HSR gear, according to Federal Railroad Administrator Joseph Szabo, even as it strengthens the case for U.S. high speed rail on (eventually) a national scale, not just a series of remote, regional pockets. Amtrak and the California High-Speed Rail Authority (CHSRA) have issued a Request for Information (RFI) for 62 HSR trainsets, with 32 envisioned for Amtrak’s venerable
Hoped-for future HSR home: Amtrak hopes station scenes such as this depiction of the proposed Moynihan Station in New York will become more the standard for Northeast Corridor passengers awaiting new and faster high speed rail service.
A triad of U.S. HSR interests makes its move, upsetting some preconceived conventional wisdom involving the nation’s passenger rail outlook. New approach to U.S. hSr Speed aNd Safety
By Douglas John Bowen, Managing editor
realize where this industry is at already regarding lightweight equipment,” Szabo said. Contrary to widespread public perception, “The FRA wasn’t pressured or swayed to do this; we brought [the two HSR parties] together, because we already had made the change almost a year ago … to shoot for the highest level of standardization. “It was an evolution FRA was making before I came here four years ago, but it’s certainly one I’ve made a priority. We were there over a year ago; perhaps we didn’t tell the story well,” Szabo observed. The personalities involved surely didn’t hurt when it came to aligning joint interests. In making the formal announcement, Szabo was joined by CHSRA Executive Director Jeffrey Morales, a former transportation staff aide to Sen. Frank R. Lautenberg (D-N.J.) from 1983 to 1993 and deeply involved in defending Amtrak funding. Amtrak President and CEO Joseph Boardman preceded Szabo as head of the FRA during the George W. Bush administration.
Boardman’s announcement in December resetting Amtrak’s HSR plans was a prelude to the joint Amtrak/California HSR pact, and Szabo praised the move, saying the new approach is “about not only meeting immediate needs of the Corridor, but that nothing eliminates the ability to go the next step.” Lightweight HSR gear “will do both; meet the needs today, and continue step by step by step.” It also will dramatically improve potential energy efficiency, he adds. The combined Amtrak/California order presumably would offer economies of scale for both entities and an equipment supplier, with Bombardier Transportation, Siemens Mobility, Patentes Talgo, Alstom, and Ansaldo among those already making their interest known. California seeks HSR equipment capable of top speeds of 220 mph, while Amtrak’s mid-term outlook envisions 160 mph top speeds on the existing NEC through Maryland and New Jersey. Advanced design, engineering ,and other pre-construction activities already are under way for the $450 million project to boost speeds from 135 mph to 160 mph along the 24-“New Jersey Raceway” between Trenton and New Brunswick, N.J. The project includes upgrading track, electrical power, signal systems and overhead catenary wires. The differential in top speeds between systems isn’t an impediment, says Szabo. California initially will be operating “in a mixed-use environment on both of the bookends. So the approach on the Northeast Corridor isn’t substantially different. Obviously there are more challenges for Amtrak because you have an existing situation there, very complex, a lot of mixed use, so it’ll be easier for California to get to 220.” And, to the delight (expressed or veiled) of perennial critics of FRA, Amtrak, and U.S. high speed rail efforts in general, more of the focus will be on crash avoidance. That’s been incorporated into the Engineering Task Force 2 (ETF2) standards developed by industry participants and the FRA, outlining safety approaches for trains operating between 125 mph and 220 mph. “We allow the highest level of flexibility to achieve the best safety outcome; the outcome is the goal,” Szabo stresses. “We’re not looking to build tanks the way we did 15 years ago.” Szabo notes neither Amtrak or California can just “pick up a European high speed rail equipment model” for off-theshelf use. “But the platform will be the same” with only minor modifications needed, he says. The Request for Information made last month reflect that: “We chose to go February 2013 Railway age 29
high sPeeD Rail
amtrak hopes to place an initial order for 12 hSr trainsets in 2014, with 20 more trainsets to follow.
LoNg-raNge, a NatioNaL SyStem
2013 Annual Conference as part of Railway Interchange 2013
September 29 - October 2, 2013 Indianapolis, IN
REGISTER NOW! Registration is now open for the AREMA 2013 Annual Conference and Railway Interchange 2013. To register for the AREMA 2013 Annual Conference, please visit www.arema.org. All AREMA badges will be honored for full access into the Exhibition Halls during operating hours. To register for the Railway Interchange Exhibition only or CMA Conference, please visit www.railwayinterchange.org. Hotel Reservations may now be made for the AREMA 2013 Annual Conference and Railway Interchange 2013. Please visit www.arema.org or www.railwayinterchange.org for more information.
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Amtrak
Szabo also disputed statements from industry pundits critical of the Obama that approach, and issue the letter … Administration—and by extension, and then start the laborious project of the FRA—for its “diffuse” approach in doing the regulatory” work. “Again, advancing high-performance passenger you [the media] missed it and we didn‘t rail in numerous locations, as opposed CYCA-580 Sandmaster Revit.”3/18/08to 5:10 PM Page do a good job telling you Ad about concentrating in 1just one or two
ideal spots. (Szabo, however, accepts the differentiation of high speed rail [HSR] and higher-speed rail [HrSR] as “a useful distinction.”) “We’re required to play the cards that we’re dealt,” he said. “The requirements Congress gave us through the Recovery Act required us to fund projects ready to go, and that were able to meet statutory deadlines.” Funds could go only to those states or entities (such as Amtrak) that chose to reply and those who qualified. “There was no possibility to strictly fund a single project or two,” he said. “We did ensure that there was critical mass achieved by focusing the investments on five megaregions— those with high population density for high-quality intercity rail to succeed,” he points out. Moreover, the seemingly scattered and separate projects at present offer the potential for “interconnectivity,” Szabo said. “It has always envisioned
Federal Railroad Administration
hSr trio (from left): chSra ceo Jeff morales, fra administrator Joseph Szabo, and amtrak president Joseph Boardman.
that this is a system” involving three tiers of service: true HSR at up to 220 mph, as per California’s statewide plan; HrSR, exemplified by ongoing work on the Chicago-St. Louis and Chicago-Detroit routes; and feeder routes, bumping emerging lines “such as in Maine and Vermont” up to 79 mph.” Szabo sees the multitiered approach not as diffuse, but instead a flexible way to advance passenger rail in ways meaningful to actual riders. “An analogy is the road network,” he says. “The Interstate highways don’t work all by themselves; they interconnect with federal roads, state roads, county roads, local roads. In much the same way, we need a comprehensive passenger rail network” using more than one performance measure. Asked if the multi-targeted approach is just a political posture, Szabo replies, “As [Transportation] Secretary Ray LaHood has said, ‘Good policy is good politics.’” If competition arises among the states, it aids in “funding the best of those applications … to give us the opportunities for success.” And far from being a top-down venue, “We
meet with local leaders, mayors, governors, chambers of commerce. It’s an important issue to communities all around the country.” Such imput has prompted a ripple effect already in many cities not generally considered part of the NEC ridershed, Szabo says, offering the slowly emerging rail activity in
community input has prompted a ripple effect in many cities not considered part of the Northeast corridor ridershed. Virginia and North Carolina as examples. “With the economic and population growth you have there, the distance between points you have there; it is not a stretch” to envision Boston-to-Atlanta service. “Few might take such a route, even at high speeds, from endpoint to endpoint, but consider all the overlapping markets,” he says. rA February 2013 Railway age 31
AnAlyzIng “fAIl to couple” yArd events When it occurs, car-coupling failure adds cost to the bottom line, adding up to millions of dollars each year, and making prevention a priority. By Devin Sammon, TTCi, and Kim Bowling & JaKe HunTeR, CSX
I
n mid-2011, CSX conducted a study within the classification yard at its Selkirk Yard in New York State. A record of events described as “failures-to-couple” (FTC) were documented. FTC events, including events related to a car stalling on the tracks, were counted. Over three 8-hour sessions, 10.5% of all cars humped resulted in a FTC event. Of the 10.5% of cars, 3.3% of all cars humped resulted in a FTC event due to a stalled car. Based on estimates from this study, FTC event related delays are a problem the railroads spend several millions of dollars each year to manage.
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Under the direction of the Association of American Railroads’ Strategic Research Initiatives Program, Transportation Technology Center, Inc. (TTCI), in conjunction with CSX Transportation and International Electronic Machines Corporation, designed a test program to determine the root causes for cars failing to couple in hump yards. The Precision Test Track at the Transportation Technology Center, Pueblo, Colorado, was used to create Testing by TTCI and CSX analyzed various component parts.
TTCi R&D
Figure 1. Summary of the results based on coupler position. RCA = Receiving Coupler Angle, ICA = Incoming Coupler Angle
impacts between railcars over a range of operating speeds. In addition to impact speed changes, the coupler lateral position relative to the draft gear pocket and the amount the knuckle was open on the incoming car were also altered. Data collection was done using a series of high-speed cameras. This gave the researchers opportunities to see frame by frame how each event caused the couplers or knuckles to move. Results from the test program indicate that one of the major contributors to FTC events is the lateral coupler position of the incoming car. Figure 1 (above) is a summary of the results based on coupler position. The y-axis shows the number of occurrences of coupled (blue) and FTC (red) events. The x-axis indicates the test condition. The plot shows
that when the coupler of the incoming car is shifted to the right, there is a lower probability of successful couplings. The only exception to this observation is when both couplers of the incoming and receiving cars are shifted to the right. Knuckle position of the incoming car also proved to be a critical variable in FTC events. Figure 2 (p.34) shows the test results based on the radial position of the knuckle of the incoming car. Results indicate that as the knuckle of the incoming car is more open, the potential for coupling increases significantly. The plot also reinforces the observation that when the coupler of the incoming car is shifted to the right, it is Data collection was through a series of high-speed cameras.
February 2013 Railway age 33
ttci R&D
Impact speeds were not as big a damaging factor as expected.
the right, it is unlikely that the cars will couple correctly. Impact speed was not as big a factor, as initially hypothesized. During the test program, coupling was influenced more by coupler position and knuckle position then speed. Visual inspections of components between impacts showed that higher speed impacts caused an increased amount of wear and damage. This damage contributed to several broken components, including cracked striker plates, broken brake hose castings, broken uncoupling levers, and a cracked coupler. The objective of this test program is to broaden the understanding of the industry by studying coupling events and FTC events from vantage points that were previously
inaccessible. By examining the interaction of the components in both proper coupling events and FTC events, differences can be explored that may lead to strategies to reduce the number of FTC events and broken components in the future. This testing has shown that in some cases the positions of coupling components may be very similar but result in different outcomes. An event like this is summarized in Technology Digest TD-12-014 titled “Investigation of ‘Fail to couple’ Events in Hump Yards.” Additional testing conducted in 2012 focused on the positions of the knuckles and couplers and less on the speed. Data from these tests will be published in future TTCI Technology Digests. RA
Figure 2. Test results based on the radial position of the knuckle of the incoming car. ICA = Incoming Coupler Angle, IKP = Incoming Knuckle Position 34
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Do you have the most up-to-date FRA Regulations?
Reb Says...
Use this handy index to verify that you have the most up-to-date version of the FRA regulations. The left-hand column lists the FRA Part number and the right-hand column list the latest revision date. Items highlighted in red denotes recent changes. (IFR = Interim Final Rule) FRA Part #
Last Update Effective:
FRA Part #
Last Update Effective:
40 . . . . . . . . .10-3-12 209 . . . . . . . .6-25-12 210 . . . . . . . .8-14-89 211 . . . . . . . .7-20-09 213 A-F . . . . .6-25-12 213 G . . . . . .9-13-10 214 . . . . . . . .6-25-12 215 . . . . . . . .6-25-12 216 . . . . . . . .6-25-12 217 . . . . . . . .6-25-12 218 . . . . . . . .6-25-12
219 220 221 222 223 224 225 228 229 230 231
. . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . . .1-1-13 . . . . . . . .6-25-12 . . . . . . .12-19-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12
FRA Part #
232 233 234 235 236 237 238 239 240 242
Last Update Effective:
Mechanical Department Regulations
. . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .7-13-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12 . . . . . . . .6-25-12
The following is a list of booklets reprinted from the Department of Transportation Code of Federal Regulations 49 CFR Parts 200 to 399 that apply to the rail industry. They are printed in a convenient format and are kept current with updates from the Federal Register which may be supplied in supplement form. Item FRA 50 or Code Part # more Each
209 211 BKTSSAF 213 BKTSSG 213 BKWRK 214 BKFSS 215 BKROR 217 218 BKRRC 220 BKEND 221 BKSEP
BKHORN 222 BKRFRS 224 BKHS 228 BKLSS 229 BKSLI 230 BKSAS 231 BKBRIDGE 237 BKLER 240 BKCONDC 242 BKBSS
232
Railroad Safety Enforcement Procedures & Rules of Practice Track Safety Standards (Subpart A-F) Track Safety Standards (Subpart G) Railroad Workplace Safety Railroad Freight Car Safety Standards Railroad Operating Rules and Practices Railroad Communications Rear End Marking Device, Passenger, Commuter & Freight Trains Use of Locomotive Horns Reflectorization of Rail Freight Rolling Stock Hours of Service Locomotive Safety Standards Steam Locomotive Inspection Railroad Safety Appliance Standards Bridge Safety Standards Qualification and Certification of Locomotive Conductor Certification
26.40
Brake System Safety Standards
13.75
8.95 8.55 8.55 6.25 8.55
8.25 7.85 7.85 5.85 7.35
4.15 3.50
3.80 2.75
12.25
10.95
5.25 9.40 10.00 19.95 8.35 5.25 11.75
4.75
10.00 Each
9.00 7.85 4.75 11.00
12.50
Technical Manual for Signal and Train Control Rules. Includes Part 233, 234, 235, 236 - Spiral Bound Order 25 or more and pay only $39.10 each
BKPSS
Passenger Safety Standards 20.80 Part 238, 239 - Order 25 or more and pay only $18.95 each
BKSTC
Signal and Train Control Systems Includes Part 233, 234, 235, 236 Order 25 or more and pay only $16.00 each
BKMPIE
Motive Power & Equipment Inspection Under Revision Defect codes for 215, 218, 223, 229, 231, 232 Coming Soon!
BKCAD
Drug and Alcohol Regulations in the Workplace Part 40 & 219
Fax: (402)346-1783 • Email: orders@transalert.com
BKMFR
Mech. Dept. Regs. Order 25 or more and pay only $24.50 each
$26.95
Part 240–Qualification and Certification of Locomotive Engineers
This book affects locomotive engineers, trainers and supervisors. The rule is largely based on recommendations made by an advisory committee comprised of rail industry and labor representatives. This final rule will clarify the decertification process; clarify when certified locomotive engineers are required to operate service vehicles; and address the concern that some designated supervisors of locomotive engineers are insufficiently qualified to properly supervise, train, or test locomotive engineers. 162 pages. Spiral bound.
BKLER
Qual. and Certif. of Loco. Engineers Order 50 or more and pay only $11.00 each
$11.75
9.00
BKTM
The Railway Educational Bureau
A combined reprint of the Federal Regulations that apply specifically to the Mechanical Department. Spiral bound. Part Title 210 Railroad Noise Emission Compliance Regulations 215 Freight Car Safety Standards 216 Emergency Order Procedures: Railroad Track, Locomotive and Equipment 217 Railroad Operating Rules 218 Railroad Operating Practices - Blue Flag Rule 221 Rear End Marking Device-passenger, commuter/freight trains 223 Safety Glazing Standards 225 Railroad Accidents/Incidents 229 Locomotive Safety Standards 231 Safety Appliance Standards 232 Brake System Safety Standards
25 or more Each
1809 Capitol Ave, Omaha, NE 68102
There are no new proposals or final rules to report for this issue. Be sure to check back next month to see if there are any changes to FRA regulations.
46.00
Part 242: Conductor Certification
The Conductor Certification rule (49 CFR 242) outlines details for implementing a Conductor Certification Program. The FRA implemented this rule in an effort to ensure that only those persons who meet minimum Federal safety standards serve as conductors, to reduce the rate and number of accidents and incidents, and to improve railroad safety. Softcover. Spiral bound. 124 pages.
BKCONDC
17.50
35.00
Order Now!
Conductor Certification Order 50 or more and pay only $9.00 each
800-228-9670 8 a.m. to 5 p.m. C.S.T., Monday/Friday
www.transalert.com
Add Shipping & Handling if your merchandise subtotal is: UP TO $10.00 10.01 - 25.00
$10.00
Add $4.10 Add 7.20
25.01 - 50.00 50.01 - 75.00
Add 9.80 Add 10.90
Orders over $75, call for shipping
*Prices subject to change. Revision dates subject to change in accordance with laws published by the FRA. 2/13
People ANACOSTIA RAIL HOLDINGS—Mark H. Sidman appointed general counsel.
SUPPLIERS Balfour Beatty Rail named several to new posts. R.T. Swindall has been named Director of Operations– east, and will lead and oversee all U.S. east Coast operations and regional offices, including Texas. Swindall will also retain responsibility for the division’s equipment Department, as well as the Track Solutions group. He will continue to be based in Jacksonville, Fla. Steve Gorton has been promoted to Director of Operations–west, based in gillette, wyo. Jamie Yourren, Director of Operations–Crossings & Signals, now also will oversee the division’s aCTa and PHl maintenance activities along the alameda Corridor (Calif.). Jason Bulger has been promoted to Senior Operations Manager-Track Solutions, reporting to R.T. Swindall. Lynn Houser has been named National Business Development Manager. GE Transportation named Karen Folino Senior Commerical leader for the company’s Optimization Solutions business. Harbor Rail Services appointed Caylan Myronowicz executive Vice President. Harsco Rail named Joseph Dougherty Vice Presidentinternational, responsible for sales, administration, and operations in europe, asia, Middle east, africa, and Russia/CiS regions. Dougherty has been with Harsco Rail nearly four years and most recently served as Vice President of Product Management, Marketing and international Sales. Dougherty joined Harsco Rail from ge Transportation where he held numerous roles in the global locomotive organization. Jay Gowan, Vice President of Sales for North and South america, will take on additional sales responsibility for Harsco Rail’s business in australia/ 36
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Februrary 2013
Meetings New Zealand. gowan has been with Harsco Rail for six years and in the rail industry for 16 years, he will continue to serve on the company’s leadership team, reporting to Scott Jacoby, President. David Baxter has been named Director of global Commercial Operations, a new position; he also reports to Scott Jacoby. Parsons Brinckerhoff named Ronald Colas Vice President in the company’s Miami office. Thales appointed Jean-Bernard Lévy Chairman and CeO. Vanasse Hangen Brustlin, Inc. announced gil Paquette will manage the new South Portland, Maine, office. George Campbell was named an associate in the new office. Tim Bryant, P.E., will lead the delivery of transportation services in Maine from the new location. Watco Transportation Services named Josh McCormack Regional Safety Manager for the east Region. Jared Carman named Regional Safety Q&a Manager. Anthony Kirkland named general Manager of the autauga Northern Railroad, an alabama short line.
100 YEARS AGO in
(FEBRUARY 1913) WATER QUALITY ISSUE The Treasury Department has issued an order to the effect that the drinking water on all trains, cars, and boats used in interstate commerce must be certified by state or municipal authorities as being incapable of conveying disease. Ice which is put into drinking water must be taken from a safe source, duly certified, and must be washed with water that is safe; and must be handled so as to prevent contamination. Water containers must be cleaned by scalding at least once a week.
March 3-6 Rail Equipment Finance Conference 2013 la Quinta, Calif. Tony Kruglinski, website: www. railequipmentfinance.com. March 5-6 18th Annual AAR Research Review Pueblo Convention Center, Pueblo, Colo. Jan lowther, Tel.: 719-584-0544; email: annual review@aar.com; website: www.regonline. com/18thReview. March 13-15 Introduction to Practical Railway Engineering Seminar Stan Fulton Building 4505 Maryland Parkway, University of Nevada, las Vegas, Nev. Desiree Knight, Tel.: 301-459-3200, ext. 703; email: dkknight@arema.org; website: www.arema.org. April 2-3 The New Intermodal Age Conference & Expo Hyatt Regency Baltimore on the inner Harbor, Baltimore, Md. Jane Poterala, Tel.: 212-6207209; email: jpoterala@sbpub. com; website: www.railwayage. April 17-19 New Jersey TransAction Conference 2013 Tropicana Hotel, Casino & Conference Center, atlantic City, N.J. email: njtransaction@aol.com. April 27-30 ASLRRA 2013 Annual Conference (100th Annual) atlanta Marriott Marquis, atlanta, ga. Tel.: 202-628-4500; email: aslrra@aslrra.org; website: www.aslrra.org.
Products Nord-Lock X-series washers ensure bolt security Nord-lock has launched its X-series washer, which combines wedge-locking protection against spontaneous bolt loosening (due to vibration and dynamic loads) with an exclusive spring effect that protects against slackening due to settlement and relaxation. The new multifunctional wedge-locking product from Nord-lock offers bolt security without compromise. with new technologies and demands,
Drill/tapping line from Volumec Treviso, italy-based Volumec offers a complete drilling/tapping line featuring its VT/VTS articulated Tapping System, capable of tapping fine holes in M3 M26 steel. it was designed to run off standard shop air, portable compressor, or even an air cylinder (limited run-time). Constructed of aviation grade tubular aluminum. For more information, call (877) 374-8005; email: info@ eri-america.com; website: www.eriamerica.com. 38
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February 2013
joints increasingly have to withstand stresses from multiple fronts, including vibration, dynamic loads, settlement, and relaxation. The Nord-lock X-series ensures total bolt security while simplifying design and maintenance since there is no need to use and stock multiple solutions . The principle of Nord-lock X-series washers includes multiple functions that act on the bolted joint to maintain
preload and prevent spontaneous bolt loosening.as with Nord-lock’s original washers, each washer pair has cams on one side and radial teeth on the opposite side to secure the bolted joint with tension instead of friction. The Nord-lock X-series washers’ conical shape also creates an elastic reserve in the bolted joint to compensate for the loss of preload and prevent slackening. “Since we work closely with our customers we can react to the trends in application design, and this product is the result of our goal to design a system that would eliminate insecurity. when you cannot say with certainty whether spontaneous bolt loosening or slackening would be the bigger issue or when both could be equal risks, there is now a solution on the market,” says Maxime Thonnerieux, development director of the new product. “Beyond vibration and dynamic loads, Nord-lock X-series allows us to serve customers with a multitude of other challenging application areas, such as painted or powder-coated surfaces, soft metals, composites and polymers. The Nord-lock X-series offers exciting new possibilities for application design,” Thonnerieux says. For more information, contact Nordlock, inc., Tel.: 877-799-1097; Fax: 224-875-3256; email: www.nordlock.com info-usa@nord-lock-inc.com; website: www.nord-lock.com.
Flame-retardant cable ties Ty-Rap® Flame-Retardant Cable Ties from Thomas & Betts are made of flame-retardant nylon 6.6 that meets the Ul94V-0 flammability rating, making them ideal for public areas where evacuation is a concern, including public transit vehicles and stations, as well as infrastructures, such as tunnels and oil and gas rigs. Ty-Rap® Flame-Retardant Cable Ties also offer chemical resistance and low smoke density. Says Chad Smith, director, product management, for Thomas & Betts, “Their flame-retardant performance is excellent, which makes them the appropriate cable tie to use in passenger and crew compartments.” The cable ties function in temperatures ranging from minus 40 degrees Fahrenheit (minus 40 degrees Celsius) to 185 degrees Fahrenheit (85 degrees Celsius). Contact Thomas & Betts, Tel.: 800-238-5000; website: www.tnb.com’ look for TyRap® on the “Brands” tab.
Nineteenth Anniversary
US$ 1,000,000,000 During 2011/2012, Railroad Financial Corporation advised railroads, shippers and financial institutions on the acquisition or disposition of more than One Billion Dollars in railcars and locomotives. Our services include: • Advising on the purchase of new equipment from manufacturers and component suppliers; • Disposing of existing equipment; • Arranging third party maintenance contracts; • Structuring finance transactions and arranging full service or net leases for new and used railcars and locomotives. If you plan to acquire or dispose of railcars or locomotives in 2013 and would like to learn why equipment end-users engage Railroad Financial and how they profit from the work RFC does for them, please contact us. Tony Kruglinski David Nahass Will Geiger
CORPORATION C H I C A G O
tkruglinski@railfin.com dnahass@railfin.com wgeiger@railfin.com
RA Wrk Ste 1_2V 10 2010
10/15/10
9:18 AM
Page 1
Products Catenary safety monitoring from IMPulse NC
T
oday’s railroads need cost-effective and flexible training choices. That’s exactly what The Railway Educational Bureau provides through Work Site Training. Work • • • • • • •
site training allows you to: Maximize your training investment Reduce employee time away from the job Reduce travel costs by having the instructor come to your location Increase the skill level of your employees Improve productivity Achieve your training objectives Utilize your in-house expertise, equipment, and facilities
Some examples of training subjects include: Freight Car Inspection and Repair • AAR Field Manual Familiarization Rules 1 thru 83 • Introduction to FRA Safety Appliances (Part 231) • FRA Freight Car Safety Standards (Part 215) • Draft system defects and repairs • Inspecting draft system and center sills (Hands-on) • Truck and Wheel defects. Roller Bearing and adapter defects • Hands-on Gauging/Measuring wheel and truck defects Single Car Air Brake Test • • • •
Fundamentals of Freight Train Air Brakes Single Car Air Brake Component Identification and Function Daily Test, Single Car Test and Special Tests Review AAR S-486 Single Car Air Brake Test Procedures
FRA Part 232 Brake System Safety Standards for freight and other non-passenger trains • • • • • •
Review Brake System Safety Standards definitions and extent of the regulations. Class l Brake Tests – Initial Terminal Inspections Measuring Piston Travel Review piston travel decals Hands-on “Class l Brake Test” Performance Evaluation “Class l Brake Test”
Train Yard Safety includes: Rail Yard Safety Blue Signal Rules Moving rail cars safely Hands-on Demonstration Call us today to learn more about how we can help you!
800-228-9670
railwayeducationalbureau.com
The Railway Educational Bureau 40
Railway age
February 2013
Mount Olive, N.C.-based iMPulse NC llC says its Catenary Safety Monitoring System monitors the health of a segment of the catenary auto-tensioned system assigned to a Balance weight assembly. it automatically provides a tesxt message alert which allows maintenance personnel to react quickly and accurately to a pending safety problem. The CSMS offers power options that utilize a solar array with battery backup or a rectifier directly from the DC catenary line. The company says the product is engineered to fit all types of Balance weight assemblies utilized in an auto-tensioned system. Designed and built in the U.S., the patent-pending product has been installed by Hampton Roads Transit for The Tide light rail transit system operating in Norfolk, Va. (photo below). The company says CSMS “operated flawlessly throughout Hurricane Sandy in October.” For more information, contact Director of Sales and Marketing Paul V. Campbell, Tel.: 919-635-7428; email: pcampbell@implusenc.com.
Ad Index Company
Phone #
Fax
Email address
amsted Rail group
312-922-4516
312-922-4597
kskibinski@amstedrail.com
C2
aReMa
301-459-3200
301-459-8077
marketing@arema.org
30
aSlRRa/waTCO
202-585-3433
202-628-6430
aslrrasearch@gmail.com
15
auto Truck
816-412-2131
816-412-2191
eschoenfeld@autotruck.com
26
CSX
904-359-1719
904-359-1899
gary_sease@csx.com
Cyclonaire Corp.
402-362-2000
402-362-2001
sales@cyclonaire.com
30
Danella Rental Systems, inc.
610-828-6200
610-828-2260
pbarents@danella.com
12
ellwood Crankshaft & Machine
724-347-0250
724-347-0254
ecgsales@elwd.com
13
Fabricated Metal
502-363-2625
502-363-2629
barbw@fabricatedmetals.com
15
Helm Financial Corp.
415-398-4510 ext 1610 415-398-4816
bwind@hlmx.com
16
Herzog Railroad Services, inc.
816-233-9002
tfrancis@hrsi.com
31
Holland Co.
708-672-2300 ext.382 708-672-0119
gpodgorski@hollandco.com
27
Hotstart
509-536-8667
509-534-4216
mfloyd@kimhotstart.com
C3
lTK engineering Services
215-641-8826
215-542-7676
tfurmaniak@ltk.com
25
MTU
+1 248 560 8484
+1 248 560 8485
bryan.mangum@tognum.com
ORX
814-684-8484
Plasser american Corp.
757-543-3526
Railquip, inc.
816-233-7757
Page #
3
5
glenn@orxrail.com
C4
757-494-7186
plasseramerican@plausa.com
21
770-458-4157
770-458-5365
sales@railquip.com
14
Railroad Financial Corp.
312-222-1383
312-222-1470
tkruglinski@railfin.com
Rails Co.
973-763-4320
973-763-2585
rails@railsco.com
Railway educational Bureau, The
402-346-4300
402-346-1783
bbrundige@sb-reb.com
Vossloh group
00 49 239 252 273
00 49 239 252 274
info@vossloh-north-america.com
37,39 16 9,35,40 7
The advertisers index is an editorial feature maintained for the convenience of readers. it is not part of the advertiser contract and Railway age assumes no responsibility for the correctness.
Advertising Sales MAIN OFFICE Jonathan Chalon, Publisher 55 Broad St., 26th Floor New york, Ny 10004 (212) 620-7224 Fax: (212) 633-1863 jchalon@sbpub.com AL, AR, IN, KY, LA, MI, MS, OH, OK, TN, TX emily guill 20 South Clark Street, Suite 1910 Chicago, il 60603 (312) 683-5021 eguill@sbpub.com CT, DE, DC, FL, GA, ME, MD, MA, NH, NJ, NY, NC, PA, RI, SC, VT, VA, WV, CANADA – QuEbEC AND EAST, ONTARIO Mark Connolly 55 Broad St., 26th Floor New york, Ny 10004 (212) 620-7260 Fax: (212) 633-1863 mconnolly@sbpub.com
AK, AZ, CA, CO, IA, ID, IL, KS, MN, MO, MT, NE, NM, ND, NV, OR, SD, uT, WA, WI, WY, CANADA – Ab, bC, Mb, SK Heather Disabato 20 South Clark Street, Suite 1910 Chicago, il 60603 (312) 683-5026 Fax: (312) 683-0131 hdisabato@sbpub.com GLObAL ADVERTISEMENT SALES, EXCEPT ITALY, ITALIAN-SPEAKING SWITZERLAND, JAPAN, AND NORTH AMERICA Donna edwards advertisement Manager Suite K5 & K6 The Priory, Syresham gardens Haywards Heath, RH16 3lB United Kingdom +44-1444-416368 Fax: +44-1444-458185 de@railjournal.com.uk
AuSTRALIA, CZECH REPubLIC, HONG KONG, INDIA, KOREA, MIDDLE EAST, NETHERLANDS, NEW ZEALAND, RuSSIA, SCANDINAVIA, SOuTH AFRICA, SOuTH AMERICA, SPAIN, WORLDWIDE RECRuITMENT Steve Barnes international area Sales Manager Suite K5 & K6 The Priory, Syresham gardens Haywards Heath, RH16 3lB, UK +44-1444-416368 Fax: +44-1444-458185 sales@railjournal.co.uk ITALY, ITALIAN-SPEAKING SWITZERLAND Dr. Fabio Potesta Media Point & Communications SRl Corte lambruschini Corso Buenos aires 8 V Piano, genoa, italy 16129 +39-10-570-4948 Fax: +39-10-553-0088 info@mediapointsrl.it
JAPAN Katsuhiro ishii ace Media Service, inc. 12-6 4-Chome, Nishiiko, adachi-Ku Tokyo 121-0824 Japan +81-3-5691-3335 Fax: +81-3-5691-3336 amkatsu@dream.com CLASSIFIED, PROFESSIONAL & EMPLOYMENT Craig wilson 55 Broad St., 26th Floor New york, Ny 10004 (212) 620-7211 Fax: (212) 633-1325 cwilson@sbpub.com
February 2013 Railway age 41
products & services Reidler Decal Corporation St. Clair, PA 17970 Fax: 570-429-1528 marketing@reidlerdecal.com The Federal Railroad Administration's proposed new delineator configuration
Reidler can help you comply with the FRA ruling by offering prismatic reflective yellow delineators that meet their specifications. • 4" x 150 fl Rolls (kiss-cut available) • 400 candlepower retroreflection • Application instructions provided
Give us a call at 800-628-7770 for more information The Leader in Railroad Markings since 1926
trAiNiNG
recruitMeNt
EDNA A. RICE, EXECUTIVE RECRUITER, INC Part 243 Training & Certification Part 242 Conductor Training Part 240 Engineer Training and re-certification -------------------------------------------------------Modoc Railroad Academy 916-965-5515 info@modocrail.com
(713) 667-0406 FAX (713) 667-1651 Web address: www.ednarice.com Email: resume@ednarice.com
EDNA A. RICE, President 6750 West Loop South Suite 735 Bellaire, Texas 77401-4111
Trainers and Training Developers The Railway Educational Bureau is in the process of creating a training and development database to be used as a resource for the railroad industry. If you have experience training in an instructor-led environment and/or developing training materials for the rail industry, and are interested in becoming a part of our group, please send your resume to:
Brian Brundige The Railway Educational Bureau 1809 Capitol Avenue Omaha, NE 68102 42
Railway age
February 2013
Railway Age Digital Edition For More Marketing Power contact cwilson@sbpub.com
equipment Sale/leaSing
Available For Lease
◆ 5,150 cu. ft. Pressure Differential (PD) Covered Hopper Cars. Food grade interior linings but don’t necessarily have to stay in food grade service. ◆ Mill Gondolas - 65’ 6” interior length with 5’ sides and 52’6 interior length with 4’6” to 5’ sides ◆ 4,240 cu. ft. Gondolas - Interior bracing still in place. OK for C&D, coke, scrap, aggregates, etc. ◆ 3,600 cu. ft. Open Top Hoppers. 45 degree slopes for aggregate, coke, coal, etc.
For additional information and pricing, please contact John Goodwin ph one (605) 582-8318 fax (605) 582-8304 www.carmathinc.com e -m ail jgoodwin@mwrail.com
STEEL BODY ROTARY DUMP HI-SIDE COAL GONDOLAS
Western Farmers Electric Cooperative offers for sale 145 railcars previously used to deliver low sulfur Wyoming coal. For information & bid package call Ben Wetherill at 580-873-2201 x140 or email b_wetherill@wfec.com. Principals only. Proposals due 4/30/13.
pRoFeSSional DiReCtoRy
Kansas City (913) 661-2424
www.rrtemps.com
We offer: - Certified Locomotive Engineers - Certified Conductors - Train Dispatchers - Yardmasters - Brakemen/Switchmen - Mechanical For Your Temporary Needs!
For advertising information call Classified Sales Representative
Craig Wilson •
phone
(212) 620-7211
• fax (212) 633-1325 e-mail
cwilson@sbpub.com
employment Steam Into History, a tourist RR, in New Freedom, PA is looking for: Maintenance of Way Specialist – Responsible for all aspects of the railroad’s track and structures and Mechanical/ Maintenance Specialist – Responsible for all aspects of steam/diesel/gas locomotives and railcars. Must have a valid steam loco engineer lic. Look online for expanded info. Positions are social security. Submit resume w/ salary req. to: hrwileczek@yahoo.com. EOE.
Find your rail industry job opportunities @ www.rtands.com and www.railwayage.com February 2013 Railway age
43
Financial Edge anthony KRuglinsKi
Valuing your rolling stock
W
e regularly get the question: “What are these cars or locomotives worth?” Our answer is always: “It depends.” It depends on the manufacturer. It depends on the car design. It depends on weight and volume limits. It depends on the unit’s age. And most of all: It depends on condition! Option 1: Hire an appraiser. Regular readers of this column have heard me quote Pat Mazzanti of Railroad Appraisal Associates, Rail Solutions’ Jim Husband, or Ed Biggs of Biggs Appraisal often as sources of information on equipment values. In my experience, each of these individuals will be happy to take a phone call (they’re on the web), explain their services and the appraisal process and, if you catch them in a good mood, give you some informal views as to what your equipment may be worth. Their ability to do this is driven by their experience and data that they have in their files on similar equipment that has been valued or bought or sold at certain price points. If you are serious about confirming the value of your specific equipment or need a valuation for purpose of financing,you will need an inspection of the equipment. Each of these appraisers can also handle inspections. Given the values of the equipment being valued, the appraisers’ valuation and inspection services are surprisingly affordable. Option 2: Consult an Equipment Value Guide. If you want a more general idea of value or value trends with regard to your equipment, you can consult one of two well-written industry “tomes” on the subject: • Railcar Value Guide, edited by First Union Rail’s Rob Blankmeyer; and • Investor’s Guide to Freight Car
44
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and Locomotive Values, produced by Rail Solutions. Either of these reference works will give you a good sense of what your equipment is worth. Be sure you read any language regarding the assumptions the authors have made in connection with assembling their values. There is also an Option #3. Pat Mazzanti, president of Railroad Appraisal Associates, will shortly be sending out the 22nd Annual Rail Equipment Finance Equipment Valuation Survey to market leaders in the rail equipment industry. This survey’s results become the basis for presentations at the upcoming 2013 Rail Equipment Finance Conference, Mar. 3-6, in Palm Springs, Calif. (www. railequipmentfinance.com).
If you are serious about confirming the value of specific equipment, you will need an inspection of it. The Rail Equipment Finance Equipment Valuation Survey gives insiders in the rail equipment market a chance to weigh-in on their views of market values associated with a host of railcar and locomotive types. Assumptions are made as to age and condition. Some of the opinions offered may be backed up with recent transactions occurring at those values, while other values may simply that contributor’s personal opinions. Some values
may be supported with extensive reasoning. Other values may just be that contributor’s naked attempts at market manipulation. The “value” of the of the survey comes through Pat’s professional “melding” of the various opinions into a series of “Low,” “Median,” and “High” equipment values that display not only market opinions on valuation, but often market direction as well. Pat warns that this melding “may” include elimination of naked market manipulation attempts. All data collected by Pat is confidential and sources are never revealed. Reflecting on the (ultimate) accuracy of these values, Mazzanti says: “Somehow it all seems to work out in the end.” (But Pat eschews any claims to the survey’s scientific accuracy.) The survey’s conclusions, which come at the end of each of the two full days of equipment presentations, are often hotly debated by the REF audiences. Hands regularly shoot up from parties that have a vested stake in certain equipment and who may feel some values are too low. There are also some broad smiles from other members of the audience, probably due to successful equipment bets that are being confirmed. The current year’s survey results are also compared with the prior year’s. At the end of each presentation, the audience is asked to vote, by a show of hands, as to whether they agree with the values presented. We’ll try to cover some of the results in future Financial Edge columns. A final word on valuing rent streams. If you have equipment that is rented to a third party and which is producing rental income, that rent stream can be (and should be) valued along with the underlying equipment.
By equipping a locomotive with a HOTSTART block heater, the prime mover can be shut down and easily restarted, even after days sitting in freezing weather. This eliminates the problems with idling including wasted fuel and oil, wet-stacking, emissions, noise and engine wear.
Visit HOTSTART.com and select Railroad from our Markets tab to learn how you can drastically reduce fuel and maintenance costs with HOTSTART idle reduction technology.
www.hotstart.com
ENGINE HEATING
Is this a technologically advanced, meticulously engineered circular marvel capable of transporting beings and cargo millions of miles? Or is it a flying saucer?
www.ORXrail.com | 814.684.8484