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Rail News: Rail Industry Trends

Rail-car demand a tad stronger in June, Longbow Research survey shows


In June, rail-car demand decreased 31 percent compared with June 2008, according to a rail-car lessor survey conducted by Longbow Research. In May, demand had dropped 41 percent year over year.

Utilization rates in June remained flat at 91 percent compared with May, but dropped from March’s 93 percent. Lease rates also were flat vs. May and remained down about 20 percent year over year, the survey of 15 to 20 lessors shows.

However, lessors’ outlook improved from Longbow’s past four surveys, the company said. Lessors expecting demand to increase jumped from zero in May to 25 percent in June. No lessor expected a demand decline and 75 percent expected flat demand, the survey shows.

“Most contacts believe the industry is nearing or at the bottom of the cycle, but many predict that any improvement in demand will be slow and gradual,” Longbow researchers said in a survey summary.

Contact Progressive Railroading editorial staff.

More News from 6/26/2009