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12/10/2002



Rail News: Rail Industry Trends

NS' capital spending to increase more than 13 percent next year


On Dec. 9, Norfolk Southern Corp. set its 2003 capital spending budget at $798 million, which is 13.2 percent more than the railroad's $705 million budget this year and 1 percent less than its $806 million budget in 2001.


The budget includes $499 million for roadway projects (compared with $482 million this year) and $246 million for equipment (compared with $173 million).


"We are continuing our solid commitment to safety and service during challenging economic times with spending levels designed to keep
our system strong and our service steadily improving," said David Goode, NS chairman, president and chief executive officer, in a prepared statement.


NS' roadway budget includes $383 million for rail, tie, ballast and bridge programs; $29 million for communications, signal and electrical projects; and $20 million for environmental projects and public improvements, such as grade-crossing separations and crossing-signal upgrades.


The railroad plans to install 163 miles of new and relay rail, 2.6 million ties and 2.8 million tons of ballast in 2003.


The Class I also plans to spend $36 million on marketing and industrial development initiatives, such as increasing track capacity and access to coal receivers, and vehicle production and distribution facilities, and improving intermodal infrastructure. For example, NS plans to upgrade its Ashtabula, Ohio, coal-handling facility to handle a different quality of coal, says NS spokeswoman Susan Terpay.


The railroad's equipment budget includes $183 million to purchase 100 locomotives, upgrade existing power, and certify and rebuild multi-level automobile racks. NS plans to take delivery of the GE Transportation Systems DASH 9-40CW six-axle, high-adhesion, 4,400-horsepower and General Motors Corp. Electro-Motive Division SD70M six-axle, high-adhesion 4,000-horsepower locomotives in the first and second quarters, says Terpay.


This year, NS spent $102 million to purchase 50 GE DASH 9 six-axle locomotives.


The railroad also plans to spend $47 million next year on computer and information-technology upgrades, including additional security and back-up systems.


Jeff Stagl


Contact Progressive Railroading editorial staff.

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