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Car Type Checkpoints Boxcars: Market dead becasue of car prices OT Hoppers: Signs of replacement interest in steel fleet. Could offset some of lost aluminum orders. Refrigerated Cars: Cost/Benefit mismatch |
Railcar Developments
June 11 , 2008 Leasing companies order and/or buy railcars, not railroad companies; and therein lays the problem The in Forbes article about the large number of surplus railcars, the author incorrectly blames the railroad companies for stocking up on ethanol cars until the “ethanol bubble burst” and they realized they had built too many cars. In truth, railcar leasing companies ordered the cars after hearing requests and projections by ethanol companies about the need for more equipment to handle future production from new capacity that was either planned or already under construction. That new capacity is still coming online, albeit at a pace much slower than originally expected, and there may be a few thousand “surplus” cars until production catches up with car supply in 2009. The ethanol phenomenon has mitigated some of the other problems faced by the railcar industry that can be more correctly blamed on the railroads. http://www.glgroup.com/Council-Member/Toby-Kolstad-85066.html?obj=search&Keyword=kolstad May 8 , 2008 The first quarter's new railcar order-delivery-backlog report was finally issued. Orders fell to 10,484, deliveries held to around 14,000 cars, and backlogs fell to around 65,000 cars due to the cancellation of many orders for intermodal and ethanol equipment. More details will follow at a later date. March 27 , 2008 Limited ethanol distribution channels and slowing production growth means surplus railroad tank cars Two years ago, the ethanol industry went into overdrive in expanding production facilities and ordering railroad tank cars to move the expected flood of new production. No one, however, looked at how the ethanol was to be handled at the customer end of the distribution network and that has produced a major problem for the new industry. Even with corn prices well above $5.00 per bushel, ethanol producers could make about $0.20/per gallon if they could get their product to the final customer, the US motorist. Unfortunately, there are only four terminals ready to handle unit trains of ethanol and the shipment of small carload lots is just too slow to move the expected production. Tank car lessors who ordered large numbers of railcars to move ethanol have been left holding the bag this time waiting for the gasoline distributors to get with the program. http://www.glgroup.com/Council-Member/Toby-Kolstad-85066.html?obj=search&Keyword=kolstad February 20, 2008 Car Totals
Octobert 25 , 2007 Car Totals Fourth quarter railcar deliveries amounted to 14, 862 cars, continuing a slow decline in production that started in the beginning of the year. Orders for new equipment reached 23,722 cars, although 11,000 of these are assumed to be related to a reported multi-year order for new tank cars running from 2009 to 2018. Without the latter orders, the quarterly total would have been only 12,722, which is more in line with the RTF forecasts of 48,000 cars in 2008. Car type totals will be published in March, but are now available to anyone who requests them. Octobert 25 , 2007 Car Totals Railcar deliveries were projected last fall to total around 61,500 cars for the year ahead, and the reported totals through the 3rd quarter are making that prediction look awfully close right now.
August 20 , 2007 Car Totals
July 18, 2007 Second quarter ARCI totals. Railcar orders during the second quarter reached only 11,595 cars, and deliveries fell to 16,143 units. We forecasted the total deliveries for the year will only be about 62,000 cars, and we see no reason to change that prediction. Quarterly deliveries are expected to continue to decline in the second half of the year and to fall even further in 2008. There were very few surprises in the individual car type totals, except for the 500 boxcar orders that were reported. Specific car totals will be posted later. July 11, 2007 Car Totals
July 11, 2007 Car Totals Watch for 2006 totals on later date Dec. 12, 2006 Car Totals
October 26, 2006 Third quarter orders, deliveries, and backlogs Twelve thousand more tank cars were ordered during the 3Q06, bring the backlog to 34, 148 cars, enough to carry production into 2009 at the current rate and well into 2008 even if production can be ramped up to 18,500 cars in 2007. The ethanol buildup knows no bounds for the present, but the number of cars on order suggests that either the industry is shooting for 12 billion gallons by 2012, or there will be a surplus of tank cars suitable for handling ethanol in a few years. If not for the DDG and grain covered hoper cars and the ethanol tank cars, the orders in the third quarter looked rather poor: (1) very few coal cars; (2) no boxcars and few flatcars; (3) and almost no intermodal cars were ordered. The latter situation is a surprise, given the 6.5% growth in intermodal traffic so far this year. Rumors of a small surplus persist and partially explain the lack of orders, but the traffic will eventually demand more cars. July 28, 2006 Tank Cars While orders for most other car types are decreasing, demand for new tank cars far exceeds the production capacity of the new car builders. So far in 2006, over 18,000 cars have been ordered and the backlog at the end of the second quarter was 25,564 cars, over two years production at the current rate of delivery. Only three car builders produce this type of car, and they are the oldest companies in the industry, tracing their roots back to the late 1800s: (1) Union Tank Car is privately owned by the Pritzker family, but (2) Trinity Industries (TRN) and (3) American Railcar (ARII) are public companies. The ARII plant that produces tank cars was damaged by a tornado during the second quarter and full production is not expected to resume until September. July 28, 2006 Car Totals
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