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<< Rail News Home: Mechanical

6/22/2004    Freight News

Rail News: Mechanical

EPA report: Rail-car deliveries to reach 46,000 units in 2005, surpass 58,000 units by 2009

During the first quarter, North American rail-car orders rose about 50 percent to 18,000, but car deliveries totaled 10,000 units, swelling car builders' backlogs from 34,000 units at the end of fourth-quarter 2003 to 42,200 units at March's end, according to Economic Planning Associates Inc.'s (EPA) recently released "Outlook for Rail Cars" quarterly report.

"Interest rates are low, inflation is moderate and recent revisions to the tax code are conducive to [increasing] consumer spending and will provide greater incentives for business purchases of capital equipment," the report states.

Because they placed fewer car orders the past three years, fleet owners' equipment is aging, which is increasing pressure to replace reefers, and box, insulated, steel coal and certain tank cars, EPA officials believe.

"[But] even with large backlogs and anticipated further growth in orders for a variety of rail cars, we believe that shortages of domestic castings will constrain assemblies both this year and into the first half of next year," the report states.

EPA projects car orders to total 42,600 units by year end — despite higher steel costs that are helping elevate car prices — and deliveries to total 46,000 in 2005.

Between 2006 and 2009, demand will increase for centerbeams, high-cube covered hoppers, intermodal equipment, and tank and coal cars, and pressure will mount to replace mid-sized and small-cube covered hoppers, and steel coal, box and multi-level flat cars. Based on those factors, car deliveries will rise to 58,400 units by 2009, EPA officials believe.

Contact Progressive Railroading editorial staff.