12/20/2016
Rail News: Security
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Rail News Home Mechanical December 2016 Rail News: Mechanical
When we hear the word “carload,” we think freight. But freight doesn’t move by itself. It needs a rail car. If you have the “car,” you can get the “load.” On the other hand, if you don’t have a load, then you don’t need the car. It’s this kind of environment that the rail industry has been living in for the past year. Except for grain, waste and nonferrous scrap, and the ubiquitous “all other freight” category — code for empty rail cars moving to storage — all freight-rail segments are down this year.Through 2016’s first 10 months, U.S. carloads were down 10 percent compared the same 2015 period, according to Association of American Railroads figures. This is a significant decline in loads that resulted in a reduced need for cars and pushed up the number of cars in storage to about 350,000.So, as we move into 2017: Are there any positives that the rail equipment industry can look for? While the answer to this question is mixed, the positives may outweigh the negatives. From a macro-freight standpoint, North American carloads next year are projected to increase 2.5 percent over 2016’s total, with all six major fleets participating in the increases. This will help draw the surplus down by 21 percent over the year, and increase the utilization of the fleet — both of which would be welcome developments.Richard Kloster