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Rail News: Mechanical

Slow economy will restrict freight-car orders, production in coming years, EPA says


After surging in 2007's final quarter, rail-car orders leveled off in 2008's first quarter, according to Economic Planning Associates Inc.'s (EPA) quarterly rail-car outlook report. Still, the 10,500 units ordered in the first quarter indicated the market still is going strong, and at March's end, backlogs totaled 65,200 units, EPA said.

However, the short-term implications of the sluggish economy are evident. In the first quarter, railroads and lessors cancelled orders for 4,850 intermodal platforms, 1,250 tank cars and 920 high-cube covered hoppers, EPA said.

Based on those cancellations, EPA has lowered its production estimates to 51,500 deliveries in 2008 and 49,800 in 2009.

Beginning in 2010, replacements of box cars, mid-sized and small-cube covered hoppers, and multi-level flat car fleets, as well as higher demand for center beams, high-cube covered hoppers, tank cars, intermodal equipment and coal cars will fuel orders. EPA predicts a pick-up in production of coal cars, Class F flat cars, intermodal platforms and box cars will boost deliveries to 53,300 in 2010 and 56,300 in 2011. Deliveries then are expected to total 59,000 units in 2012 and 60,500 units in 2013.