All fields are required.
By Pat Foran, Editor
In our annual “Outlook” coverage, which we will publish next month, freight-rail CEOs will provide their takes on the economy and the potential for near-term growth. During October’s third-quarter financial webcasts/teleconferences, Class I execs offered a glimpse into some of what they might say about rail’s 2014 prospects — and how confidently they might characterize those prospects for at least the foreseeable future.
Despite continuing coal headwinds, and carload volumes that in the aggregate don’t exactly scream “boom time,” all six publicly traded railroads posted stellar financial results and set a number of quarterly records; the available numbers for the seventh Class I, Berkshire Hathaway Inc.-owned BNSF Railway Inc., were good, too. Earnings recaps for all seven railroads are posted at www.progressiverailroading.com; Class I news coverage is categorized by railroad.
Improved yields helped most if not all seven roads. But higher volumes of a range of commodities — from auto-related to chemical (not just energy related) to forest to industrial products (although they vary from railroad to railroad), plus intermodal (it was up for most of them) — had the biggest impact. That diversified strength continued to offset declines in coal or other commodities, and it’s a trend that continues into the fourth quarter, rail execs say. Moreover, the strong fall harvest will give railroads a Q4 boost in ag products, especially considering that volumes will be compared with last year’s post-drought traffic.
So: Although they expect the economy to expand at its consistently slow pace, and even though coal’s near-term prospects remain murky, Class I leaders like the momentum they’ve got, and where they see their respective roads heading as they roll through Q4. As CSX Corp. Executive Vice President of Sales and Marketing Clarence Gooden put it, according to a transcript of the railroad’s Oct. 16 earnings webcast: “This macro-environment is supportive of growth across all three merchandise sectors, industrial, agricultural and construction. In addition, the intermodal business continues to grow at rates that well exceed the rate of the broader economy.”
As mentioned, we’ll check in with freight-rail execs during the information gathering for our Outlook issue. We’ll also contact a cross-section of transit-rail leaders to talk about funding issues, ridership trends and anything else that matters to them as they prepare for 2014.