Railway Age April 2023

Page 60



Facing Our Biggest Challenges NJT,
CP, KCS Form Three-Nation Network
How They Came to Be in 1983 COMBINATION HISTORIC

Railway Age, USPS 449-130, is published monthly by the Simmons-Boardman Publishing Corporation, 1809 Capitol Avenue, Omaha, NE 68102. Tel. (212) 620-7200. Vol. 224, No. 4. Subscriptions: Railway Age is sent without obligation to professionals working in the railroad industry in the United States, Canada, and Mexico. However, the publisher reserves the right to limit the number of copies. Subscriptions should be requested on company letterhead. Subscription pricing to others for Print and/or Digital versions: $100.00 per year/$151.00 for two years in the U.S., Canada, and Mexico; $139.00 per year/$197.00 for two years, foreign. Single Copies: $36.00 per copy in the U.S., Canada, and Mexico/$128.00 foreign All subscriptions payable in advance. COPYRIGHT© 2023 Simmons-Boardman Publishing Corporation. All rights reserved. Contents may not be reproduced without permission. For reprint information contact PARS International Corp., 102 W. 38th Street, 6th floor, New York, N.Y. 10018, Tel.: 212-221-9595; Fax: 212-221-9195. Periodicals postage paid at New York, N.Y., and additional mailing offices. Canada Post Cust.#7204564; Agreement #41094515. Bleuchip International, PO Box 25542, London, ON

April 2023 // Railway Age 1
N6C 6B2. Address all subscriptions, change of address forms and correspondence concerning subscriptions to Subscription Dept., Railway Age, PO Box 239 Lincolnshire IL 60069-0239 USA; railwayage@omeda.com; or call +1 (402) 346-4740; FAX +1 (847) 291-4816. Printed at Cummings Printing, Hooksett, N.H. ISSN 0033-8826 (print); 2161-511X (digital). FEATURES 11 13 40 45 52 56 59 Historic Combination CP+KCS=Transnational CPKC CEO Perspectives Facing Our Biggest Challenges Railinc Freight Car Review Fleet is Trending Larger Tech Focus – M/W Crossties: Active Sleepers Passenger Rail Focus NJT, Metro-North, SEPTA at 40 Timeout for Tech Welding Physics and CWR TTC Operated by ENSCO Fortis Prototype Fabrication, Testing COMMENTARY 2 9 64 From the Editor Financial Edge ASLRRA Perspective DEPARTMENTS 4 6 8 61 62 62 63 Industry Indicators Industry Outlook Market People Professional Directory Classifieds Advertising Index COVER PHOTO Double-headed, single-line service: Canadian Pacific and Kansas City Southern—CPKC. Canadian Pacific photo April 2023 52 AILWAY GE New Jersey Transit

I Respectfully Disagree With Your Dissent

One for the history books:

At the time of this writing, we are two weeks away from a traditional “final spike” ceremony, the most significant one in 154 years. This one, at Knoche Rail Yard in Kansas City on April 14, marks creation of North America’s first transnational railroad—the joining of Canadian Pacific and Kansas City Southern into CPKC (Canadian Pacific Kansas City). In Surface Transportation Board parlance, it’s the official “control date.” But it really marks the “wedding of the century,” as far as railroads are concerned.

We all know that the STB voted 4-1 to bless the marriage, which in my opinion—I can say this now without reservation—is a “home run” that makes a whole lot of sense for economic, operational and environmental reasons I don’t need to get into. Read the 212-page STB decision. It’s laid out in detail, with all the bases covered. Pardon the baseball analogy—it’s opening day for the Major Leagues, Yankee Stadium for me (go Bronx Bombers ... uh, Kansas City Royals!)

Board Member Robert Primus, who happens to hail from Madison, N.J., 16 miles from my hometown of Newark, N.J., cast the lone “no” vote. No doubt his reasons were carefully and thoughtfully considered. CPKC to Primus probably looks more like a risky bunt than a home run. I respectfully disagree with his dissent.

“When I hear the word perfect, certain milestones come to mind,” Primus says in his opening dissent paragraph. “Don Larsen’s perfect game (pitching for the Yankees!) in the 1956 World Series against the Brooklyn Dodgers; Rocky Marciano’s perfect 49-0


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professional boxing record; the perfect season of the 1972 Miami Dolphins ... What doesn’t come to mind are railroad mergers. Far from it, to be honest. And yet we have been told the transaction ... is just that. According to the Applicants, there will be no detriment to the public interest—no disruption of service, no significant harm to surrounding communities, and no consequences from allowing even further concentration of economic power in the freight rail industry ... Not only do I not share the Applicants’ optimism, but I disagree with the Board’s approval of this transaction.

“[M]y objections to the transaction are threefold. First, the transaction will further concentrate control over the nation’s railroads, which have already experienced massive consolidation in recent decades—a development that has not been favorable to rail customers or the network as a whole. Second, in the absence of a service assurance plan (which would have been required under the current rules), the decision does not adequately guard against merger-related service disruptions, at a time when rail service in general has been historically poor. Third, the transaction will harm communities along the path of the newly combined network. Because these detriments to the public interest outweigh the expected benefits, I dissent.”

Again, I respectfully disagree. Does my opinion really matter, at the end of the day? Not really. I’m simply an observer, hopefully an informed one. But I do feel fortunate that, in my 30-plus-year career with 167-year-old Railway Age, I get to experience a historic event, as one of my predecessors did in 1869.

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2 Railway Age // April 2023 railwayage.com
WILLIAM C. VANTUONO Editor-in-Chief Railway Age, descended from the American Rail-Road Journal (1832) and the Western Railroad Gazette (1856) and published under its present name since 1876, is indexed by the Business Periodicals Index and
Engineering Index Service. Name registered in U.S.
Office and Trade Mark Office in Canada. Now indexed in
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TrinityRail ® is North America’s leading railcar equipment and services provider. With a comprehensive platform of leasing, manufacturing, maintenance and professional services, you can rely on TrinityRail to fully deliver trusted expertise, innovative solutions and supply chain optimization. Learn more at TrinityRail.com.

Industry Indicators


“Coal, chemicals and grain combined account for more than half of U.S. non-intermodal rail volume. When all three are down, it’s extremely likely total carloads are down too,” the Association of American Railroads commented last month. “That’s what happened in February 2023 compared with February 2022: Total carloads fell by 15,101 carloads, or 1.6%. Coal by itself was enough to take total carloads into negative territory. In February, coal carloads fell by 16,648, or 6.1%, from February 2022. That’s coal’s biggest monthly percentage decline in two years. Excluding coal, carloads rose 0.2% in February. Carloads of chemicals were down 6,298 (4.6%) in February, their sixth straight decline. (It was a tough comparison month—February 2022 was the second-best month ever for chemical carloads.) Carloads of grain fell 9.7%, or 9,227 carloads, in February. U.S. intermodal volume fell 8.4% in February, its 12th straight decline.”

Railroad employment, Class I linehaul carriers, FEBRUARY 2023

(% change from FEBRUARY 2022)



(train and engine) 50,858 (+7.99%) Executives, Officials and Staff Assistants

8.114 (+6.65%) Professional and Administrative

10,086 (+2.58%)

Maintenance-of-Way and Structures 28,454 (+2.31%)

Maintenance of Equipment and Stores 17,851 (+3.87%)

Transportation (other than train & engine)

4 Railway
April 2023
Intermodal MAJOR U.S. RAILROADS BY COMMODITY FEB. ’23FEB. ’22% CHANGE Trailers 56,31376,929-26.8% Containers 887,666 953,401 -6.9% TOTAL UNITS 943,9791,030,330 -8.4% CANADIAN RAILROADS Trailers 0 0 Containers 236,622256,490 -7.7% TOTAL UNITS 236,622256,490 -7.7% COMBINED U.S./CANADA RR Trailers 56,31376,929-26.8% Containers 1,124,288 1,209,891 -7.1% TOTAL COMBINED UNITS 1,180,601 1,286,820 -8.3% FOUR WEEKS
Source: Rail Time Indicators, Association of American Railroads
4,847 (+2.19%) Source: Surface Transportation Board
MAJOR U.S. RAILROADS BY COMMODITY FEB. ’23FEB. ’22% CHANGE Grain 85,86095,087-9.7% Farm Products excl. Grain 3,4363,085 11.4% Grain Mill Products 38,62336,6355.4% Food Products 26,38525,2534.5% Chemicals 131,554137,852-4.6% Petroleum & Petroleum Products42,64836,81515.8% Coal 258,053274,701-6.1% Primary Forest Products 4,3474,681 -7.1% Lumber & Wood Products 12,25413,935-12.1% Pulp & Paper Products 20,91121,754-3.9% Metallic Ores 14,26015,287-6.7% Coke 12,470 13,364 -6.7% Primary Metal Products 36,31433,9576.9% Iron & Steel Scrap 16,93215,4939.3% Motor Vehicles & Parts 53,81149,4228.9% Crushed Stone, Sand & Gravel 76,03367,21213.1% Nonmetallic Minerals 11,62213,089-11.2% Stone, Clay & Glass Products 26,70527,851-4.1% Waste & Nonferrous Scrap 13,40114,341-6.6% All Other Carloads 20,12521,031-4.3% TOTAL U.S. CARLOADS 905,744 920,845 -1.6% CANADIAN RAILROADS TOTAL CANADIAN CARLOADS 316,809 287,40710.2% COMBINED U.S./CANADA RR 1,222,553 1,208,252 1.2%


1,222,5531,208,252 FEBRUARY

Short Line And Regional Traffic Index

TOTAL U.S. Carloads and intermodal units, 2014-2023 (in millions, year-to-date through FEBRUARY 2023, SIX-WEEK MOVING AVERAGE)

April 2023 // Railway Age 5 railwayage.com
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CARLOADS BY COMMODITY ORIGINATED FEB. ’23 ORIGINATED FEB. ’22 % CHANGE Chemicals 55,122 45,03622.4% Coal 20,287 18,768 8.1% Crushed Stone, Sand & Gravel 24,174 17,97034.5% Food & Kindred Products 12,017 11,035 8.9% Grain 25,644 30,527-16.0% Grain Mill Products 8,436 7,13318.3% Lumber & Wood Products 8,491 9,088-6.6% Metallic Ores 3,162 2,743 15.3% Metals & Products 19,062 16,68514.2% Motor Vehicles & Equipment 9,069 7,81216.1% Nonmetallic Minerals 2,480 2,391 3.7% Petroleum Products 2,359 1,81130.3% Pulp, Paper & Allied Products 14,624 15,791-7.4% Stone, Clay & Glass Products 13,023 11,05617.8% Trailers / Containers 35,272 40,998-14.0% Waste & Scrap Materials 11,474 9,40122.1% All Other Carloads 64,655 61,986 4.3% AILWAY GE Visit http: //bi t.ly/rai l jobs To place a job posting, contact: Jerome Marullo 732-887-5562 jmarullo@sbpub.com ARE YOU A RAILROAD OR SUPPLIER SEARCHING FOR JOB CANDIDATES? RA_JobBoard_1/3Vertical.indd 1 7/27/21 3:02 PM

Amtrak FY24 Grant Request: $3.65 Billion


“Thanks to the support of Congress and the enactment of the IIJA, Amtrak has now begun a new era of investment to improve our service and to expand our network to serve more people with more trains in markets where intercity passenger rail can make a difference,” Amtrak CEO Stephen Gardner said. “Through modern infrastructure, new fleets of trains, upgraded technology and a new generation of dedicated employees, Amtrak is committed to delivering reliable, high-quality, and modern services to the tens of millions of Americans who ride our trains and on behalf of the various federal and state partners that support in serving the traveling public.”

Gardner noted that Amtrak’s overall financial performance in FY22 “improved significantly, continuing our trend of recovery since the COVID-19 pandemic.” Total ridership came in at 22.9 million—71% of FY19 levels—and the railroad’s adjusted operating earnings “exceeded our estimates, led notably

by a nearly 50% growth in revenue compared to FY21 as our strategy of attracting new riders, aggressively managing sales and pricing, and broadening our customer base produced results,” he explained.

Despite this, ridership and operating revenues were “outmatched by the strong headwinds of rising costs, which meant substantial operating losses remained,” Gardner reported. “In particular, operating costs increased as we restarted services across our network while high-value NEC business travel was slow to recover, which had an outsized effect on our revenues. To support a historic increase in the number and size of capital projects now being advanced with IIJA funding, the company began a multi-year increase in investments associated with hiring and training, financial controls, and other company-wide needs, which is adversely impacting our adjusted operating earnings. This was on top of general inflationary pressures that adversely affected many aspects of Amtrak’s business in FY22: The company’s costs per available seat-mile rose by more than 15% from FY19 levels.”

Gardner added that Amtrak hired roughly 3,700 new employees in FY22 “to rebuild our ranks and restore service across our network, allowing us to return all of our Long-Distance trains back to pre-pandemic levels and restart nearly all of our suspended State-Supported short-distance corridor routes, while also introducing a record number of new or

expanded services, including in Vermont, Virginia and Massachusetts.”

Gardner pointed out that Congress provided the $1.70 billion and $1.95 billion authorization levels for the NEC and NN grants, respectively, in November 2021. Since then, he said, “Amtrak has been able to forecast ridership, revenue and our annual needs with a much greater degree of confidence, and while $3.65 billion remains an appropriate top-line funding total, the specific needs of the NEC and the NN have shifted as revenues and expenses have changed.”

To give Congress “the most transparent and helpful view of Amtrak’s needs and of where federal investment can be applied,” Gardner said, the railroad has broken down its FY24 grant request into “base needs” and “modernization.” Base needs represent “the minimum funding level needed to operate trains, maintain the railroad for the year, carry out core functions necessary to avoid long-term deterioration to assets and services, and make a limited number of high-priority, high-impact strategic investments for our future.” Modernization represents “various initiatives that will enable Amtrak to improve the railroad and our customers’ experience for the 21st century and ensure our long-term health.”

In the IIJA, Congress set authorized (recommended) annual funding levels— non-binding targets that inform, but do not control, the yearly appropriations process— for Amtrak’s NEC and NN grants in FYs 22-26. Separately, the IIJA also provides $22 billion in guaranteed additional funding (a supplemental appropriation) for the same five-year period to support specific, discrete capital needs on the NEC and NN. In FY24, this totals $4.4 billion, including $1.2 billion for the NEC and $3.2 billion for the NN. By law, this IIJA funding must be used for specified purposes, and cannot be used to operate trains or backfill other near-term needs typically covered by annual appropriations.

“In other words, IIJA dollars were always intended to supplement, not replace, regular annual grant funding—and if sufficient annual appropriations are not provided in FY24, Amtrak may be unable to sustain current service levels on the NEC and NN,” Amtrak noted. “Accordingly, consistent with Congress’ intent, Amtrak is seeking the total authorized level of FY24 annual grant funding—$3.65 billion—in addition to the guaranteed capital funds provided by the IIJA.”

6 Railway Age // April 2023 railwayage.com Industry Outlook

Greenbrier: $580MM in Orders

The Greenbrier Companies last month reported receiving orders for 4,500 new railcars during the fiscal second quarter ended Feb. 28, 2023, for which it provided preliminary results. At an aggregate value of $580 million, the orders for tank cars, autoracks, boxcars and covered hoppers “were consistent with Greenbrier’s expectations for the period,” according to the manufacturer. It noted that certain orders “are subject to customary documentation and completion of terms.” Greenbrier also reported that it expects revenue of approximately $1.1 billion, deliveries of 7,200 units, and GAAP EPS of $0.95 to $1.00 per share during its fiscal second quarter. “Our order activity and financial performance in the second quarter demonstrate Greenbrier’s market-leading position in freight railcar sales, leasing and services,” Greenbrier CEO and President Lorie L. Tekorius said.


TRANSGABONAIS Operating Company (Setrag) has awarded a one-year contract to ENSCO to conduct track geometry measurement on the 402-mile railway linking the port of Owendo in Libreville and Franceville, Gabon, Africa. When the measuring system has been installed on a Setrag railway vehicle, ENSCO will train Setrag personnel to operate the system. The standard-gauge line carries around 9 million tons of freight and 330,000 passengers per year. Setrag launched a US$643 million project to rehabilitate the entire railway in 2016. Track upgrading started in 2017, and so far, 143 miles of track has been renewed. The railway suffered a major landslide between Offoué and Booué on Dec. 24 that halted train services. The line reopened to freight on Feb. 8 and passenger services were restored on March 30.


Enterprise Content Delivery Network (eCDN) provider NETSKRT SYSTEMS and BAI, soon to be rebranded as BOLDYN NETWORKS, will work together to enhance rail passengers’ onboard Wi-Fi experience, including offering them ondemand and live video streaming services. BAI will integrate Netskrt’s eCDN for Rail solution, which “deploys content delivery intelligence in the cloud and video caches on each train,” with their connected transport solution to give rail operators a “seamless, easy-to-deploy and manage connectivity solution.”

TRANSMETRIQ, a RAILINC brand that provides rail shipping optimization software, has added advanced fleet insight capabilities to its Asset Manager offering. The new Lease Management module, TransmetriQ says, “expands visibility from asset location, health and status into lease-related analysis and reporting, and provides railcar owners and lessees with a central location for storing detailed lease information, enabling users to generate insight from varied data sources, improving planning, and ensuring accurate billing.” The module provides “improved management capabilities for lessees and

lessors including tracking lease renewal dates and terms, reconciling billing to lease terms, managing asset deployment, identifying repair cost responsibility, and analyzing lease term compliance (e.g., mileage).” This new functionality, the company says, “allows users to analyze private lease data, in addition to the location and health data they are accustomed to seeing from Railinc and TransmetriQ, while providing a new, morecomprehensive picture of their fleet and operations. Shippers that lease or own their rail equipment need information that enables the safe and efficient use of their fleets. Asset Manager is designed to provide insights that help shippers gather and act on that vital fleet information, helping them improve cost control, car availability and complex data management.” According to TransmetriQ Product Manager-Asset Manager Gregg Phillips, “The new Lease Management module addresses a lack of visibility to lease information and siloed data, which can frustrate leasing managers. Lease Management enables tracking of key lease details and incorporates characteristics of individual users’ leases into the metrics they track for asset performance, improving fleet insights.”

8 Railway Age // April 2023 railwayage.com Industry Outlook William C.

Rail Equipment Finance 2023 Key Takeaways

In i ts 37th iteration, Tony Kruglinski’s Rail Equipment Finance Conference (REF) once again took place at the oasis in the desert: The LaQuinta Resort and Club in LaQuinta, Calif. Held in the shadow of the East Palestine derailment but before the calamity associated with the Silicon Valley Bank disaster, REF 2023 was in full force with more than 400 conference attendees. Following is a summary of what was discussed at this year’s REF, with key takeaways (KT).

Jose Maria Liberti, Clinical Professor of Finance, Northwestern University Kellogg School of Management, discussed the M&A market for rail. Transportation is an early M&A market mover before interest rates start to rise. As a result, industrial investors manage margin compression through tightening economic cycles, and buy back shares when M&A is unavailable. KT: From 2009 through 2021, Union Paci c returned 763% vs. 214% for the S&P TMI.

David Humphrey, from Railinc, covered changes in the national freight car eet. Year-over-year national eet increases were less than 1%. ed largest increases were mill and coil gondola railcars and boxcars. KT: e national eet average age is 20.1 years and steady; 20.1 years equals 40% of railcar interchange life (see p. 40).

Robert Pickel, from National Steel Car, noted a volatile delivery cycle with deliveries in a narrow range near the annual railcar attrition rate. KT: Expect 42-45,000 cars built in 2023, impacted by component supply and labor challenges.

Eric Starks, from FTR Transportation Intelligence, noted a discordant U.S. economy with increasing GDP, low credit card delinquencies, high cash reserves, 6.3% CPI year-over-year, and an in ationary service economy. KT: While new railcar orders are holding steady, expect lower railcar utilization resulting from lower freight demand.

Graham Brisben, from PLG Consulting, noted decreases in crude and re ned fuel loadings while chemical loadings are a bright spot. Downstream products (chemicals, ethanol and NGLs) cannot replace loadings lost from coal declines. KT: Rail needs to move minerals for battery production to

support EV growth. e In ation Reduction Act (IRA) will shi U.S. energy consumption in the next eight years.

Edward Murphy, from Standard & Poor’s, noted a potential recession and showed decreasing railroad ORs while service has declined. KT: Post-recession, S&P is watching increasing truck driver shortages, supply chain emissions reductions and post-pandemic nearshoring.

Stefan Loeb, from Watco (now with NS), discussed how short lines increase North American carload business. Worsening North American systemwide service, limited 2022 short line carloads, with many loads lost to trucks. KT: PE investment in short line railroads indicates growth and opportunity and will drive pro ts.

Daniel Anderson, from TrinityRail, noted a 20% age gap between the tank railcar eet and the national eet resulting from acceleration of younger tank railcar attrition, a changing commodity mix and de-emphasization of crude oil from 2019. KT: e IRA and EVs can decrease railbased fuel loads. Renewable fuel investments may o set this.

Adriene Bailey, from Oliver Wyman, discussed North American rail’s need to increase market share through service improvements (think better than 2018 and 2019). Executives and regulators need a better vision to generate successful long-term growth. Rail needs to convince its investors that growth is the only future. KT: Public/private partnerships are necessary for the required pivot moving rail to the next business cycle.

Ron Sucik, from RSE Consulting, discussed the historic shi of 50% of 4Q22 container imports (boxes) from the West to East Coasts. is helped end the West Coast container ship jam. Nearshoring could reduce Asia-originated shipments 20% by 2025. 2023 intermodal growth looks tepid, with the highest unused vessel capacity since a er the pandemic’s start. KT: e projected 2H2023 rebound has headwinds; Gulf and Eastern container moves negatively impact intermodal loads.

Je Blake, from e David J Joseph Company, discussed steel market trends leading to more domestically sourced steel to reduce China’s steel market dominance.

20 million nominal tons of projected capacity from new electric arc furnaces is commencing in 2023, increasing U.S. demand for scrap steel. KT: China may become a net exporter of scrap by 2025.

John Ward, from the National Coal Transportation Association, noted that longer cycle times (from delays or crew unavailability) negatively impacted 2022 coal volumes, that Wyoming coal mining companies lost $100 million revenue, and negative consequences from railroad coal car caps all resulted from rail service-related problems. Coal-generated power replacement continues to be challenged as supply chain disruptions impact renewable buildouts. KT: 62,000 MW of coal- red generation are due for retirement from 2023-2028.

Ross Corthell, from Packaging Corporation of America, David Horwitz, from GATX Corporation, and Adam Simeon, from Union Paci c, talked boxcars. e UP boxcar eet increased 18% from 2020 and is 7% newer than the eet; 35% of the boxcar eet reaches regulatory obsolescence between 2022 and 2030. Larger-capacity cars could mean that the replacement cycle requires fewer new cars. e boxcar manufacturing backlog is into 2024, with 11,925 projected deliveries from 2023 to 2027. Boxcar replacement investor economics remain challenging. Growthoriented shippers may struggle aligning car capacity to product and legacy facility loading requirements. Boxcar pricing has doubled since the early 2000s. KT: In 2022, the national boxcar eet grew by more than 1,000 cars for the rst time in 15 years. Boxcar eet tonnage capacity is higher than in 2016 (most recent peak capacity). However, from 2008 to 2027 (projected), the total eet will be reduced by 39%.

Edward Biggs, from Biggs Appraisal, Sean Hankinson, from AITX Rail, Pat Mazzanti, from Railroad Appraisal Associates, and Greg Schmid, from Residco, led the railcar valuation panel. Estimated FMVs have increased or stayed level from 2022 values except for coal cars (surprising considering recent strength in that market) and 30,000gallon non-coiled, non-insulated “ethanol” tank railcars (more limited use a er May 1, 2023). KT: In a strong lease market for

April 2023 // Railway Age 9 railwayage.com Financial Edge

Financial Edge

railcars, survey participants rated industry health seven out of ten.

Paul Titterton, from GATX Corporation, discussed GATX’s long, successful history in railcar leasing. GATX has maintained a core focus on safety, employee longevity, nancial stability and consistent business plans. Keeping the customer at the center of business is a core corporate value. KT: With 125 years of experience, even as business fundamentals stay consistent, GATX knows that railcar leasing’s subtleties and nuances are always changing.

Anthony Hatch, from ABH Consulting, began REF’s day two discussing potential impacts of the East Palestine derailment. He discussed the need for improved service and growth to placate hungry investors, highlighting current labor market challenges and impacts. Short line railroad sales are expected to continue in 2023. KT:

e U.S. DOT estimates U.S. freight movements will increase 30% by 2040, from 19.3 billion tons to 25.1 billion tons.

Perennial REF favorite Sergio Rebelo, MUFG Bank Distinguished Professor of International Finance, Northwestern University Kellogg School of Management, gave a U.S. economy update. Declining birth rates and an aging workforce continue to stress the U.S. labor pool. On the supply side, prices on electronic components (e.g., semiconductors) remain o -trend high even a er reduced freight costs. Rebelo discussed in ation and the Federal Reserve’s potential to overshoot (under-deliver) its in ation targets while striking a balance for the economy. KT: World trade as a percentage of GDP is projected to decrease. Rare earth mine production (commodities necessary for batteries) favors China and Asia vs. the U.S. and Europe.

Ross Corthell, from Packing Corporation of America, Roger Jimenez, from Tokai Carbon, and Eric Monger, from KBX Rail, discussed the shipper point of view on rail freight and railcars. All parties felt that the time for excuses related to why service continues to be so poor has passed and needs to be replaced by action from the railroads to improve service. Technology is something that is on the shippers’ minds, both as it relates to railroad service and to providing assistance in handling a dicult hiring environment. KT: Panelists felt that e ectively addressing car supply issues could not be e ectively addressed until rail service normalizes.

Patrick Kurtz, from AITX Rail, discussed the covered hopper railcar market. In the grain market, the eet has an 8% capacity slack, with most large-capacity cars in full utilization. ere is greater slack in plastic pellet hoppers. Small-cube hoppers are experiencing a “dead cat bounce.” KT: A 26% reduction in 4,000- to 5,000-cubic-foot covered hoppers o set by jumbo car growth means more cubic capacity from smaller car count increases.

David Humphrey, of Railinc, led Wednesday’s “Power-Power-Power” sessions covering the locomotive eet. e locomotive eet average and median age increased, due to decreased new builds. KT: e percentage of new and rebuilt units per year added/ adjusted in Umler has remained fairly constant over six years.

Mike Cory, from CFG Consulting Inc., and Don Graab, from Triangle Brothers and Associates, discussed locomotive use in North America. e lack of growth in loadings is partly responsible for the weak new-locomotive demand cycle, perpetuating the rebuild cycle. Questions were raised about timing for implementing scalable hydrogen as an alternative fuel. KT: In discussing the alternative fuel transition, the railroads will need a cohesive strategy not based primarily around biodiesel.

Glen Rees, from Cummins Inc., discussed the push to zero emissions from the perspective of an engine manufacturer. Cummins is leading the move to zero emissions with investment in the broadest spectrum of alternative fuel options: battery, fuel cell, and its fuel-agnostic engine. KT: “Intermediate action can be taken to reduce emissions in the short term, which a ords time for technology … to meet the goal of carbon-free by 2050.”

Robert Bremmer, from Wabtec, discussed the market for new locomotive products with emphasis on the current FLXdrive locomotive and a future with hydrogen powered locomotives. Bremmer emphasized the rebuild market and its technical improvements. Wabtec has a roadmap for the future of locomotive technology leading into 2030 and beyond and sees opportunity for real and signi cant CO2 reductions. KT: Right now, several solutions exist to lead North American rail to an attractive and environmentally sound alternative-fuel future.

Stuart Biggs, from Biggs Appraisal, discussed the changes in the locomotive

eet consistency that show a signi cant decrease in SD60 and SD70 locomotives in operation year-over-year. KT: ere were approximately 450 rebuilds performed in 2022 by Wabtec and Progress Rail/EMD.

Pedro Santos, from CNGmotive Inc., provided an update on alternative locomotive fuel strategies. Generally, there are limited options for North American rail to achieve carbon-neutral and carbon-free locomotive fueling: hydrogen, renewable natural gas and eMethane. Santos discussed the challenges of using liqui ed vs. compressed hydrogen. KT: Liquid hydrogen is 20 degrees F above absolute zero (–460 degrees F). If there was a liqui ed hydrogen spill, the commodity discharge would actually liquify the air!

Jason Kuehn, from Oliver Wyman, focused on North American rail’s challenges in contemplating the alternative fuel switch. With SAF and renewable diesel competing for the same feedstock and an estimated gap of 1.7 billion gallons of more demand than there is of potential supply through 2030, the 2025 goal of net-zero emissions seems distant. Harnessing the regenerative braking power of locomotives could provide a much-needed improvement to the emissions puzzle. KT: e largest new-locomotive builder in North America is Siemens Mobility, albeit all its units are for passenger service.

Pat Mazzanti, from Railroad Appraisal Associates, Rick Ortyl, from Metro East, and Greg Schmid, from Residco, discussed locomotive valuation. Generally, the locomotive market is so er than in 2022. e demand cycle, concerns about the alternative-fuel transition and the worry that certain models lack longevity weighs on the marketplace. KT: On some newer units, secondary market sales are adding valuation clarity.

Great speakers! Great content! anks to all the speakers and attendees.

Got questions? Set them free at dnahass@ rail n.com.

10 Railway Age // April 2023 railwayage.com
DAVID NAHASS President Railroad Financial Corp.


It’s ‘Clear Track Ahead’ from the STB. Now, the hard work begins.

March 15, 2023, will be reported in the history books as a momentous day for the North American rail industry. On that Wednesday, as widely expected, the Surface Transportation Board, in a 4-1 vote, approved, with certain conditions, Canadian Paci c’s acquisition of Kansas City Southern to form Canadian Paci c Kansas City (CPKC), North America’s rst transnational railroad. STB Member Robert Primus was the only dissenter in a decision that authorized CP to exercise control of KCS, which will o cially occur April 14, 2023. e CPKC executive leadership team, led by President and CEO Keith Creel, is in place, tasked with the hard work of integrating two unique yet highly compatible companies.

Headquartered in Calgary, Alberta, Canada, CPKC will remain the smallest of six U.S. Class I railroads by revenue, and have a much larger and more competitive network, operating approximately 20,000 miles of rail and employing close to 20,000 people. Full integration of CP and KCS is expected to happen over the next three years, “unlocking the bene ts of the combination.”

CP President and CEO Keith Creel, Railway Age’s 2021 Railroader of the Year and, with KCS President and CEO Pat Ottensmeyer, 2022 Co-Railroader of the Year, extended

“sincere gratitude to the STB and sta for their hard work as part of the comprehensive review of the combination.”

“ is decision clearly recognizes the many bene ts of this historic combination,” Creel said. “As the STB found, it will stimulate new competition, create jobs, lead to new investment in our rail network, and drive economic growth. ese bene ts are unparalleled for our employees, rail customers, communities and the North American economy at a time when the supply chains of these three great nations have never needed it more. CPKC will connect North America through a unique rail network able to enhance competition, provide improved reliable service, take trucks o public roads, and improve safety by expanding CP’s industry-leading safety practices.”

“ is important milestone is the catalyst for realizing the bene ts of a North American railroad for all of our stakeholders,” said Ottensmeyer. “ e KCS Board of Directors and management team are very proud of the many contributions and achievements of the people who have made KCS what it is today, and we are excited for the boundless possibilities as we move forward into the next chapter as CPKC.”

Keith Creel will become President and CEO of CPKC. Subject to formal appointment by the new company’s Board of Directors, CPKC’s 11-member executive leadership

team, all reporting to Creel, are:

• Nadeem Velani, Executive Vice President and Chief Financial O cer.

• John Brooks, Executive Vice President and Chief Marketing O cer.

• Mark Redd, Executive Vice President and Chief Operating O cer.

• John Orr, Executive Vice President and Chief Transformation O cer.

• James Clements, Executive Vice President Strategic Planning & Technology.

• Je Ellis, Executive Vice President Chief Legal O cer and Corporate Secretary.

• Warren Erdman, Executive Advisor Strategic Projects.

• Laird Pitz, Senior Vice President and Chief Risk O cer.

• Mike Foran, Senior Vice President Network & Capacity Management.

• Chad Rolstad, Vice President of Human Resources and Chief Culture O cer.

• Oscar Augusto Del Cueto Cuevas, KCSM President, General Manager and Executive Representative.

Pat Ottensmeyer will continue as an advisor to Creel throughout 2023 “to ensure continuity on key initiatives predominantly involving the combined company and Mexico.”


“ e Board expects that this new single-line service will foster the growth of rail tra c,

April 2023 // Railway Age 11 railwayage.com
Stephen C. Host

shi ing approximately 64,000 truckloads annually from North America’s roads to rail, and will support investment in infrastructure, service, quality and safety. e transaction is also expected to drive employment growth across the CPKC system, adding more than 800 new union-represented operating positions in the United States,” STB said in its 212-page decision. “Of additional importance, the merger will foster new Amtrak passenger rail opportunities, as applicants have committed to support Amtrak’s existing plans for expanded service on the new railroad’s lines.

ese commitments, along with CP’s strong record as an Amtrak host railroad, have won Amtrak’s endorsement of the merger.

“ is transaction is ‘end-to-end,’ meaning that there are little to no track redundancies or overlapping routes. It will reduce travel time for tra c moving over the single-line service, which should result in increased incentives for investment, and it will eliminate the need for the two now-separate CP and KCS systems to interchange tra c. is will enhance eciency, which in turn will enable the new CPKC system to better compete for tra c with the other larger Class I carriers. It is not surprising that there is substantial (though not unanimous) shipper support for this transaction—the Board has received more than 450

support letters. It is also not surprising that the other Class I railroads seek conditions, and other remedies that appear aimed at protecting their own tra c from competition with CPKC and at limiting the ability of the combined CPKC to meet its potential. Consistent with the Board’s policy to protect competition and not competitors, the Board is denying those requests while also ensuring that existing competitive gateway options are preserved.

“Even end-to-end mergers, however, can pose competitive risks, and indeed this decision overturns prior agency precedent that did not su ciently recognize such concerns. To address any potential anti-competitive harm, the Board is imposing numerous conditions designed to protect competition. And with these conditions, the merger should not reduce any shipper’s competitive options. e Board establishes a detailed obligation to keep gateways—that is, connection points between the CPKC system and other railroads—open on commercially reasonable terms, thereby preserving e cient routing options via other railroads that were available to shippers before the merger.

“To help enforce that obligation, the Board will require CPKC to justify in writing, upon customer request, rate increases over a certain level on interline movements, subject to the

gateway obligation. If disputes arise over whether CPKC’s actions are commercially reasonable, CPKC must a ord rail customers an arbitration option to resolve disputes, but the Board also will remain available to expeditiously decide gateway-related disputes. In this way, this decision seeks to enable a more e cient and competitive CPKC system, while minimizing CPKC’s ability to wield new market power to the detriment of its shippers.

“In addition, the Board has engaged in an extensive and thorough environmental review ... e Board recognizes that, although most localities would prefer less rather than more train tra c, any tra c that CPKC diverts from trucks and from other railroads will produce more trains traversing areas that are currently served by either CP or KCS. is transaction, however, should ultimately enhance safety and bene t the environment.”

“ e Board concludes that this merger will not increase safety risks in any meaningful way beyond whatever level of risk exists from the current daily train movements through the communities served by CP and KCS. Indeed, approval of this transaction may even enhance safety for the nation as a whole.

“ e Board is establishing an unprecedented seven-year oversight period along with extensive data-reporting requirements. is will enable the Board to closely monitor whether Applicants are in fact preserving ecient interline options for shippers at a ected gateways, thus protecting competition ... e Board recognizes that some in the shipping community and among antitrust commentators are not satis ed with the consolidation among Class I railroads that occurred following the Staggers Rail Act of 1980, and the Board itself has done its best to address how the Class I railroads behave today.

“Indeed, there is an ongoing debate about whether there has already been too much consolidation in the rail industry. Regardless of which side one takes in that debate, the Board is charged by Congress with reviewing the proposed merger in light of the state of the industry as it actually exists. Given the current realities and the limited opportunities to provide meaningful competition for the largest Class I railroads ... the Board concludes that this transaction should improve rather than degrade the performance of the industry. It is for these reasons that the Board approves the merger.”

12 Railway Age // April 2023 railwayage.com cover story
CPKC Transnational Network Canadian Pacific


North America’s rail industry is sharply focused on the future as the 21st century is well into its third decade. For this special report, the industry’s thought leaders, the chief executives of leading North American companies, have crafted exclusive, insightful essays for Railway Age on growing and sustaining our vibrant industry, which has helped shape our society and is the backbone of transportation. Each has provided an answer to the single-most critical question: What is the biggest challenge facing the North American rail industry?

14 Katie Farmer, BNSF

16 Tracy Robinson, CN

18 Joe Hinrichs, CSX

20 Jack Hellmann, Genesee & Wyoming

22 Alan Shaw, Norfolk Southern

24 Lance Fritz, Union Pacific

26 Patty Long, Railway Supply Institute

28 Dan Smith, Watco

30 Keith Creel, Canadian Pacific

34 Ian Jefferies, Association of American Railroads

35 John Newman, Progress Rail

36 Marc Buncher, Siemens Mobility

38 Peter Gilbertson, Anacostia Rail Holdings

Bruce Kelly

Rail Must Evolve to Remain Relevant

hat all of us know with certainty is the important and essential role that railroads serve in supporting the economy and the American way of life. at was never more apparent than during the pandemic.

What o en isn’t seen with such clarity is that change is and has been a constant in our industry over time. And that change has never been more evident than over the past few years. We have been confronted with tremendous change of a magnitude and frequency that none of us has experienced before.

e past three years exposed strains in the supply chain that we hadn’t experienced before—we saw points of vulnerability that had never been tested before. We are at a natural in ection point where we know that if we are going to remain competitive and remain relevant, we must evolve.

e good news is that we are in an industry that has been evolving since its inception almost 200 years ago. We know how to do this.

It starts with people. e most important

Wasset of any railroad and the reason that any of us are successful is our people.

Any conversation on evolving with our people must start with safety. It is the bedrock of what we do. We remain committed to achieving our safety vision of a workplace free of accidents and injuries. And we know that vision is achievable with our people and continued innovation and improvement in technology.

What we also know a er the past three years is that the future of work has changed.

e workplace has fundamentally shi ed and will continue to change.

If we are going to continue to attract the best and brightest to our industry, we need to nd the solutions that meet the needs of our employees while providing consistent and reliable 24/7, 365 day a year service for our customers.

To remain relevant—we must be open to change—and equally committed to nding the answers.

At the end of the day, we want our company and our industry to not only be a great place to work but a great place to have a long career and deliver on our promise to

our customers.

at promise to our customers also needs to evolve for our industry to remain competitive. To remain relevant.

We recognize at BNSF that to continue our long history of growth with and for our customers—we must continue to improve the experience for our customers by o ering a better service product, more transparency, and increasing the ease of doing business. And we must work to adapt our product to the demands of the new supply chain.

We are fortunate to be in an industry with a long history of evolving our product and the value proposition it provides our customer.

There are many examples of this in BNSF’s history, such as our grain shuttle network, which changed the way producers move their grain to export markets. Crude by rail, which made what was essentially trapped oil economically viable thanks to rail’s flexibility and short ramp-up time. Perhaps the best example is the incredible growth of our intermodal network.

ere are countless examples across the industry of that same theme. Seeing an unmet customer need and evolving the service product to seize the opportunity and grow the business.

We know where the industry needs to evolve and adapt as our employees, our customers, and the supply chain itself evolves. However, at BNSF, there is one thing we will never change. Our bias for growth.

It is incredibly important during times of rapid change and disruption, for our customers as well as our employees, to see consistency in how we approach our business—who we are and who we will always be at BNSF.

What will never change is that BNSF is committed to having the capacity, the equipment and the people that allow us to say “yes” to new business opportunities.

I have never been more optimistic about BNSF or the industry. I know our best days are in front of us. e sustainability and the economy of rail are the perfect answer for the direction in which the supply chain is evolving. And I have no doubt we’ll be as essential and relevant in the future as we are today and have been for well over a century.

14 Railway Age // April 2023 railwayage.com
We’re committed to safe, efficient and sustainable service for the freight-rail journey ahead. gwrr.com


The Industry Must Collaborate as a Single Supply Chain

Rail built our continent. It has been at the heart of settling far-off regions and moving goods since the time of the steam engine. It has always been and will always be a critical component of our continent’s economic infrastructure. We have evolved greatly since the days of the steam engine and our operations have followed suit. Today, we are complex and interwoven in elaborate relationships and competing globally

However, our modern industry faces significant challenges that threaten our

global competitiveness. Chief among these challenges is our ability to collaborate as a single supply chain. As the resiliency of our supply chain continues to be tested, the absence of collaboration may hamper North America’s ability to keep competing globally in the years to come. We believe that this challenge also creates an opportunity where all actors of the supply chain can win together.

We also believe that this can be an area for governments to use their position as arbitrators and regulators for positive influence. By leveraging their role, governments can encourage

collaboration by bringing the right actors to the table. They can also help coordinate investments in the North American supply chain to ensure its long-term competitiveness by identifying systemic bottlenecks and targeting them for necessary upgrades. This collaboration amongst supply chain actors will encourage further coordination amongst partners, break down silos and improve fluidity, ensuring that goods and people can move quickly and efficiently.

The entire supply chain and customers would benefit from this cooperative approach. Sharing data and increased transparency would allow different parts of the supply chain to anticipate and correct any issues that may arise as we would reduce or eliminate unnecessary delays and create an environment where everyone wins.

As an industry, we have demonstrated that you can have some of the most efficient railways in the world, providing top-notch service while leading the way in innovation. We have even been able to reduce our emissions and improve our fuel consumption, and deploy new and innovative technology while moving goods faster than ever before. Canada in particular has also achieved these feats while offering some of the best freight rates in the world.

While the challenge of global competitiveness is not new, the ever more complex evolution and shifting of trade patterns will require a new approach. Promoting and enabling collaboration amongst supply chain partners can provide a clear path forward for the rail industry to continue investing and serving as a critical component of our continent’s economic infrastructure.

We want to work with our partners to enable the next level of growth. Policymakers must recognize the strategic importance of the rail industry as a means for our continent to compete globally and take action to ensure its long-term success for the North American economy and the millions of people who rely on it every day. At CN, our commitment will continue to be pushing for collaboration while once again striving to provide the best rail service and leading the way in innovation and sustainability.

16 Railway Age // April 2023 railwayage.com


And it all starts close to home.

At Norfolk Southern, we are commi ed to supporting the cities and towns that our tracks connect. We are commi ed to building a more sustainable future. And we are commi ed to delivering the essential freight that keeps the world moving. From our remediation e orts in East Palestine to the investments we make in all of our communities, we are dedicated to building a brighter tomorrow for all.


© 2023 Norfolk Southern Corp.


Investing in People to Deliver Growth

Last year, Railway Age asked CEOs for their thoughts on how we can grow the rail industry’s top line. I did not arrive at CSX until later in the year, but when I looked back at the responses, I found myself in total agreement with the theme that ran throughout every one of them: We grow by leveraging improved service and our environmental advantages to win market share from trucks.

This year, as I think about the biggest challenge facing our industry, it comes down to a single word—delivering. Speaking for CSX, we know that we need to grow the business, but the question is how we are going to deliver that growth. I believe we have some great answers that are already being put into practice and are starting to provide results.

Growth is driven by service. The principles of scheduled railroading produced

dramatic improvements at CSX before the pandemic upended the global economy in 2020. Supply chain congestion and labor shortages overshadowed much of the progress we had made, but the foundation remained intact, and over the past six months we have succeeded in replenishing our train-and-engine workforce and restoring network fluidity.

So far in 2023, our operating performance metrics have largely returned to pre-pandemic levels, and we are providing some of the best service in our railroad’s history.

To me, what is most exciting about our service performance is how we are accomplishing it. The most significant, sustainable impact we are having on service is coming from our efforts to build trust with our employees and improve their work experience. We are engaged in transforming our culture to create a self-reinforcing cycle that occurs when employees

see how providing great service directly benefits their work experience.

For example, last year at this time, on any given day CSX had an average of more than 200 T&E employees stuck at a location for more than 30 hours. ey couldn’t be home with their families, and they couldn’t maximize their productivity and earnings. is year, that number is down to just 50—and we will keep working to reduce that further. Much of the improvement is the result of the success of our T&E hiring e orts throughout 2022, and much of it is also due to a more uid network. But the “X” factor that elevated the improvement from good to great was the e ort from our leaders to get out in the eld and listen to our front-line employees and work to solve the problems they raised. We made sure everyone in our company knew who provides the service we get paid for—our front-line employees. I believe that if you want to build trust, you must invest your time in building relationships. It starts with our employees.

After last year’s difficult and contentious rail labor negotiations, we recognized that our railroad could never achieve its full potential if the distrust between our front-line workers and the company continued. We could not deliver transformational growth if we continued to be a house divided against itself. So we took what we learned from our visits to the field and what we heard from unions during the bargaining round to meet with labor and take a fresh approach to addressing issues.

The result has been a series of agreements with our labor unions on providing paid sick leave, adjusting our attendance policies, as well as other process and policy changes, both large and small, that have demonstrated how we are committed for the long haul to improving the work experience of our employees. Improving their work experience does have a small cost component, but we believe it is an excellent investment, because it rewards the people who are ultimately responsible for delivering our service product to our customers. And when the employees who create value for our customers feel valued, included, respected and more engaged in our railroad’s mission, our service improves—and the self-reinforcing cycle

18 Railway Age // April 2023 railwayage.com
photos: CSX

is set in motion. Our industry faces other challenges, and economic uncertainty will continue to impact volumes. But these are business challenges that we are confident can be

handled effectively as we work together as ONE CSX team. The game changer, we believe, is a cultural transformation in our ONE CSX workforce that engages our employees and enables us to deliver on

our growth potential by providing better service to our customers. This improved service gives us the permission to talk about growth with our customers. And so the cycle continues …

April 2023 // Railway Age 19 railwayage.com
Any Mode, Any Material, Any Market Transportation Material Handling and Storage Logistics watco.com Partner with us — and discover your competitive edge


Regaining Momentum, Re-establishing Credibility

The b iggest challenge facing the North American rail industry in 2023 is to regain our momentum and re-establish our credibility after a period of turmoil that has included inconsistent rail service, workforce uncertainty, new public concerns around the safety of rail transportation, and persistent regulatory scrutiny. Rising to meet these challenges, we will need to not only embrace pragmatic operational enhancements but also target new technologies that make us even safer, even more environmentally friendly, and even more committed to providing our

customers with the transparency and ease of rail experience that they deserve.

The magnitude of opportunity for rail freight is immense, and I can’t recall a more compelling outlook for the North American industrial economy. Whether it is due to increasing customer focus on low-carbon transportation, de facto U.S. industrial policy that is supporting infrastructure investment, massive new semiconductor facilities, accelerated development of the electric vehicle industry, or customers focused on shorter, simpler supply chains with increased local investment, we have profound reasons for optimism.

But to achieve this promising future amidst a revitalized North American economy, the challenges of this moment must be addressed with unwavering commitment: commitment to safety, which is a prerequisite for attracting great people and guaranteeing our social franchise in the communities in which we operate; commitment to our people, showing the next generation of railroaders that we are the employer of choice; commitment to our customers to provide reliable and transparent service worthy of the digital age; and commitment to innovation, embracing technologies that make us safer, smarter and more efficient.

Thankfully, we have some critical attributes on our side. Rail is the safest and most environmentally friendly form of surface transportation. Moreover, the low-friction physics of the steel wheel on steel rail already generates an economic efficiency that is superior to even the grandest visions of autonomous longhaul road transport. And with innovations in the fuel used in our locomotives (e.g., G&W’s Freightliner in the U.K. now runs a train for a major ocean carrier that is powered by green biofuels) as well as advances in locomotive technology (whether battery, hydrogen or both), the inherent advantages of rail should only strengthen in a carbon-reduced world.

At G&W, we also believe that rail can successfully compete against shorthaul trucking, filling our short lines with new traffic, adding rail jobs, and increasing road safety, which is why we are a strategic investor in a start-up company called Parallel Systems that would introduce autonomous, batterypowered bogies to handle container movements from ports.

Finally, we’ve all seen the importance of supply chain visibility over the past three years, and that is why we are partners in the RailPulse coalition, which aims to provide customers accurate realtime updates on the location, health and status of their railcars across the North American freight rail network.

The future for rail is bright, and as we address the challenges of 2023, we will prove that adversity only makes us stronger for the journey ahead.

20 Railway Age // April 2023 railwayage.com
Genesee & Wyoming


We have the solutions you need regardless of what you're moving. With more capacity, industry-leading performance and shorter routes, we are always innovating. CP’s exceptional freight solutions are built to help you move your business forward.



Safety First, Safety Always

After the train derailment in East Palestine, Ohio, Norfolk Southern promised to make it right. For the people in that close-knit village and nearby towns, that means cleaning the site safely and thoroughly; testing the air, water and soil; helping families whose lives were disrupted; and investing in the community for the long-term.

Part of making it right also means enhancing safety as a company and as an industry. Norfolk Southern may own the track in East Palestine, but the responsibility of making the rail industry safer is something we must all own.

I’ll be the first to praise rail as the safest, most effective way to move freight, a view I share with NTSB Chair Jennifer Homendy, who recently said: “Despite recent accidents, I want to be clear that rail remains one of the safest means of transportation. For transport of some classes and quantities of hazardous materials, there is no safer alternative.” She’s right, of course, but ‘no safer alternative’ doesn’t mean we’re satisfied. We need to work together to build on our industry’s strong safety record. An industry-wide comprehensive approach is essential, including railcar owners, car manufacturers, leasing companies, equipment manufacturers and the

railroad companies. We can make rail even safer, but it’s going to take all of us, making changes inside our organizations and cooperating to enact meaningful, fact-based change for the industry.

For our own part, we’ve taken several steps in the right direction. In addition to joining the Federal Railroad Administration’s Confidential Close Call Reporting System (C3RS), which builds upon our own long-standing Close Call Experience Program, we’ve implemented a plan enhancing the safety of our operations. That plan involves strengthening our early-warning systems and our technology to identify issues before they become problems.

Beyond working together as an industry, we also need to work with lawmakers proposing rail safety legislation. We support legislative e orts that will improve outcomes for our industry, our customers and the communities we serve.

We also believe there’s a significant opportunity to better support first responders. Norfolk Southern recently expanded its existing training programs with the creation of a new regional training center to serve first responders in Ohio, Pennsylvania and West Virginia. People from all three states rushed to the derailment site on Feb. 3, and I’m profoundly grateful for their help that day. We’re expanding first responder training in other ways too, including our Operation Awareness & Response program, which travels our 22-state network, training approximately 5,000 first responders each year to safely respond to rail incidents. We are committed to improving safety, which means the men and women who support us need our support in return.

The same goes for our people. I am proud to represent more than 19,700 Norfolk Southern employees who work every day to offer a safe and effective means of transporting freight. Part of showing my gratitude for their hard work and dedication means fostering a culture of trust, collaboration and transparency. We want our people to be engaged, speak up, and be part of the solution. Rising to this challenge, a challenge we all face, means working together to think about safety first—safety always.

22 Railway Age // April 2023 railwayage.com


Going the extra mile for our customers and our communities.


Measuring Success by the Impact on the Many, Not the Few

As I am in the last of my 23 years at Union Pacific, it is stunning to reflect on the change in our industry and at our company over the course of my career. I am forever proud of my time and the

team at Union Pacific, but never more so than in these three years since COVID19 first emerged. Despite the myriad of challenges that confront our industry, there are three guideposts I have found to be the best path to success.

Number one is delivering safe,

consistent, reliable service day in and day out. We are nothing without it and it is the foundation of our ‘Serve, Grow, Win – Together’ strategy. Union Pacific is at the forefront of innovative technology, such as our cutting-edge APIs that offer seamless customer and supply chain integration; and our commitment to safety is unrelenting and ever-present, reflected in our industry-leading employee personal injury rate, which has seen double-digit improvement year over year. We know from recent events in the industry that this is more important than ever before.

Once we know we are running a safe, consistent and reliable railroad, we pressure test every idea and every decision against every stakeholder—customers, employees, communities and shareholders. Employees must be fulfilled in their work and feel valued; customers must feel like Union Pacific is helping them win in their markets; communities must feel like we are helping them solve their critical problems; and shareholders must be rewarded with returns that encourage further investment. If I have learned anything, it’s that any choice that appears to pit one stakeholder against another is a problem. We have the best employees and best rail franchise in the country, and with that comes the ability, and the obligation, to meet more than one objective at a time.

As leaders, as a company and as an industry, we have had to become more agile. What our employees value has changed. Lengthy labor negotiations overshadowed 2022, but Union Pacific ended the year with historic wage increases—our craft professionals received a 24% pay boost pushing average railroad salaries to $110,000 a year by 2025—and ensuring continued equal pay for women and people of color.

What our customers need has also changed. Inflation, supply chain challenges and fuel prices dominated how every company across the country, and the world, operated. Union Pacific harnessed the power of our network to serve our customers in new and exciting ways. We are reinvesting in our infrastructure with innovative technology to improve our network’s efficiency,

24 Railway Age // April 2023 railwayage.com
Union Pacific

productivity and service.

What our communities desire has changed as well, and we have needed to respond. We must be active participants in communities where we work and live, but we also have a bigger responsibility to our planet—and Union Pacific is an active participant in finding a solution. A net-zero future is one we all share, but at Union Pacific, we are making a meaningful and measurable difference, committing to reduce absolute scope 1 and 2 GHG emissions from our operations 26% by 2030 against a 2018 baseline on our path to net-zero emissions by 2050.

And when we do all this right, we are also being responsive to our owners—the shareholders. Union Pacific is delivering as the only U.S. Class I railroad that experienced volume growth in 2022, with the best return on investment capital and the second-best Operating Ratio in the industry.

The world is more dynamic and expects more from us. Putting our stakeholders

at the center of our decision making helps us find the best solution. Ensuring every employee goes home safely, helping our customers get their jobs done,

supporting and connecting our communities and building on our growth track record are what define Union Pacific and why I know our future is bright.

April 2023 // Railway Age 25 railwayage.com CEO PERSPECTIVES
Bruce Kelly T tal Solutions Partner totaltrackmonitoring.com 1.630.320.1381 L.B. Foster provides award-winning wayside technology to monitor safety, increase network velocity, and enable the Digital Railway. Rockfall Monitoring » Accurately detects and remotely alerts controllers of obstructions on track » LIDAR optical fence increases railroad network velocity Mk-IV WILD » Measures wheel impacts, train weight, lateral forces, and truck hunting » Continually monitors rail vehicle health, reducing the likelihood of derailments to ensure safety TOTAL TRACK MONITORING STAY IN GEAR WITH RAIL GROUP NEWS ROUND-UP of NEWS STORIES FROM: RAILWAY AGE, RT&S and IRJ RAIL GROUP NEWS From Railway Age, RT&S and IRJ https://railwayage.com/newsletters RA_RailGroupNews_Fourth_InGear_2022.indd 1 1/10/22 12:43 PM

When Consensus Is Staring You in the Face: An Invitation to Partnership

As a society, and all too often in our nation’s Capitol, we spend our time focused on differences—difference of opinion, policy priorities, funding levels—rather than seeing the areas in front of us where we can clearly agree. Consider the almost unanimous belief in

the benefits of moving people and products by rail. Objectively and statistically, rail is the safest, most sustainable, most economical and most efficient mode of transport.

Recognizing this, a bipartisan majority in Congress passed legislation in November 2021 to invest more than $100 billion U.S. taxpayer dollars in the rail industry,

as 297 members of Congress (228 in the House and 69 in the Senate) voted for the Infrastructure Investment and Jobs Act (IIJA), a $1.2 trillion investment overall. They understood that it would create jobs, promote more sustainable movement of people and products, and update a system that is key to our country’s economic health and national security.

Fast-forward 18 months, and our critical industry is behind the eight ball. The once-in-a-generation opportunity to modernize U.S. infrastructure is slipping away under the weight of extreme inflation that threatens the U.S. transit industry and its domestic supply chain. At the same time, U.S. modal share for freight rail continues to decrease.

And who should care? The answer is a comprehensive ecosystem that begins with the American public and includes dozens of industries and the organizations that represent them.

On the passenger rail side, there are organizations that should be working together to ensure that infrastructure investments continue to fuel job creation, economic growth and keep a once-healthy supply chain intact. Proven solutions such as more efficient procurement and inflation adjustments have already made a difference for other industries such as defense.

And, while the RSI has started this discussion with the American Public Transportation Association (APTA), there are many others that need to be at the table, including, but not limited to, Associated General Contractors (AGC), American Road & Transportation Builders Association (ARBTA), American Society of Civil Engineers (ASCE), AFL/ CIO, and the Sierra Club.

On the freight side, the percentage of goods moving by rail is decreasing even as rail transportation is shown to be safer, more cost-effective, and more sustainable. But, we are losing on service, flexibility and transparency.

I can track my Domino’s pizza from the oven across town to my front door, and get a tracking number from the USPS to see the status and location of my package to grandma, but no one can tell me when my boxcar full of critical parts rolling across the Midwest is going to arrive at its

26 Railway Age // April 2023 railwayage.com CEO PERSPECTIVES Railway Supply Institute

destination. That has to change, and we have the technology to change it.

Don’t get me wrong: I’m not naïve to the challenges of consensus. But the process begins with the acknowledgement that we all want the same outcome. And we do!

Shippers want to move their goods by rail for the reasons I’ve shared. Class I’s and short line railroads (many familyowned) want their business to succeed and thrive. Rail suppliers that build and own the freight railcars, maintain the track and develop the communications and signals want to invest in new cars and technologies to further improve safety, sustainability and logistics. Environmental groups (and most humans I know) want fewer greenhouse gas emissions. Labor wants more jobs. And the U.S. taxpayer supports spending less on maintaining roads while decreasing traffic congestion and highway fatalities.

More rail is the proverbial rising tide that lifts all our boats. We need to sit

down together and determine how to improve our collective fates. To those I’ve mentioned (and others I’ve inadvertently left off), this is a personal invitation to partnership. Let’s check our differences and our egos at the door and focus on the bigger picture to fuel collective growth and progress.

Patty Long has more than 30 years of

experience in the manufacturing trade association world, having held senior positions with the National Association of Manufacturers, the National Asphalt Pavement Association and the Plastics Industry Association. RSI is the largest and only trade association representing the full supply chain for the North American railroad system.

April 2023 // Railway Age 27 railwayage.com CEO PERSPECTIVES
countoncsx.com CSX brings first-class service and a technologically enhanced shipping experience across our extensive rail network that reaches nearly two-thirds of the U.S. population.
you’re ready to move your business forward, count on CSX. Safe Shipping. Sustainable Solutions. CSXT-001634_RailwayAge-CEO-InterviewIssueMarch2023-7x4.85_RsG.indd 1 3/22/23 9:57 AM
Bruce Kelly


People Matter Most

Ib elieve all Railway Age readers will agree: There is no greater transportation system in the world than the North American freight rail network. No

other transportation mode moves as many different commodities, as much volume, over greater distances, safer and more efficiently, than our North American freight rail network. But without

the great men and women who make it happen each day—those who work the ground and those who support them— this great network would be useless. It is the people who matter most

Recently, I have watched, read and listened to harsh criticisms of our industry. But times of challenge bring opportunity. The opportunity in front of us now is real. We have a chance to show the resiliency and dependability of our great industry. We can do that by demonstrating every day what all of us already know: People matter most.

There is no doubt we all suffer, especially our customers, when our industry stumbles. Whether caused by man, machine or an act of God, no industry works harder to improve and overcome while continuing to meet the needs of our customers. The show must go on— even during times of immense challenge. I know the great people within our industry will always rise above the challenge and seize the opportunity. They always do, even when it isn’t simple, and even when it costs more than it should.

When I think about what the biggest threat is against this great industry, it isn’t safety, or service, or strategy. I think it is much simpler than that. I think it is finding, keeping and developing the right people. It is making sure the people that work within our industry stay inspired to do great things, safely and better than yesterday. It is about making sure the people who count on our industry for service remain satisfied with how we perform, every single day. And it is about making sure the people who watch us perform don’t place unreasonable limitations on our industry, probably because we didn’t do the first two things well enough. It is about always remembering people matter most.

At Watco, we embrace putting our customers and our people first. We work hard to keep our heads down and do a good job, every day, for our customers and our team members. We aren’t perfect. We don’t get it right every time. But our greatest measure of success at Watco is the satisfaction of our customers and our team. We know that if the men and women wearing Watco jerseys

28 Railway Age // April 2023 railwayage.com
Two photos: Watco


are prepared and inspired each day, they will give us their best effort. Their best effort satisfies our customers and makes Watco safer and more efficient. Our approach is simple to explain

but complicated to execute. It is easier said than done. But the one thing we will keep doing every day is focusing on what matters most: making sure our people are prepared and inspired

to do great things for our customers— safely, quietly, and in an unassuming manner. We believe that you will always win when you focus on people, because people matter most.


The Hump Yard ProcessControl System in 22 classification yards across the US and Canada featuring:

• AutomaticCalibration

• Graphic Playback

• Realtime Hump List Display

• Pinpuller Scoreboard Display

• Automatic Report Generation

• Loggers –Daily, Event and I/O

• Electronic Track Blocking

• AEI Integration and List Verification

• Remote Diagnostics


The NX Control System in 12 locationsproviding Entrance–Exit andTrain Control Operation for Receiving,Pullback and Departure Yards featuring:

• NX Route Control – Receiving and Pullout Yards

• 4G Wireless Control

• Track Circuit-Less Shove Operation

• Realtime status of all yard devices

• Logger –Daily,Event and I/O

• Individual Switch Control

• State-of-the-art Lightning Protection

• Graphic Playback


, switch and track occupancy detection using wheel detectors. Provides data essential for maintaining a High Performance yard.

sophisticated reporting tool to simplify troubleshooting, analyze yard. Reviewing Up-to -the-minute historical performance.

April 2023 // Railway Age 29 railwayage.com


Safety is a Journey, Not a Destination

As an industry, we must prepare ourselves to grow as supply chain patterns around the world change. at means anticipating those changes and adapting to meet them. We must earn the con dence of our customers with our service and, just as important, keep safety at the forefront of everything we do to protect our employees, our goods and our communities.

Following the March 15 Surface Transportation Board decision approving our transaction, the Canadian Paci c (CP) team is focused on executing its combination with Kansas City Southern (KCS) to become Canadian Paci c Kansas City (CPKC). We’ve spent more than two years pursuing this once-in-a-lifetime, end-to-end combination in order to better serve the North

American supply chain. e combined CPKC will bring increased competition and expanded service options at a time when they have never been needed more.

The pandemic-induced manufacturing shutdowns in China, and the shipping interruptions that followed, led companies to reconsider where to locate manufacturing. Our industry must consider whether containers from Asia bound for inland points will continue in the same pattern as they have in recent decades. These shipments will of course remain a valuable part of our business, but the trend toward nearshoring means we must be ready to grow in new ways to serve our customers’ changing needs.

Our new CPKC single-line network is uniquely positioned to move goods among Mexico, the United States and Canada.

Shippers see the long truck queues at the major border crossings. ey want new options to compete with trucks and highways. ese options need to come with lower greenhouse gas emissions and cannot sacri ce reliability or transit times. e new CPKC single-line haul to the U.S. Midwest and beyond does just that. We estimate businesses will redirect 64,000 trucks annually from highways to our rail network. We will win that business by o ering truck-like transit times and reliability while capitalizing on rail’s environmental and fuel economy bene ts.

At the same time, we as an industry have seen communities turn skeptical about the safety of trains traveling through their borders. We know our industry represents the safest method of transporting goods over land, and we must tell that story. We must also embrace safety as a journey, not a destination, as we work toward being safer today than we were yesterday.

In 2022, CP set the all-time record for the lowest Federal Railroad Administration accident frequency rate. We are now 69% lower than the Class I average and have maintained the lowest accident rate for 17 consecutive years. CP’s culture of safety, supported by its history of sustained investments in core infrastructure and technology, aligns with that of KCS, allowing the combined system to operate at the apex of rail safety. CPKC will implement the combination with safety at the forefront of everything it does.

Precision Scheduled Railroading (PSR), which CP implemented a decade ago, has been integral to that best-in-class safety record. We set a new all-time low train accident frequency of 0.93 in 2022—more than a 50% improvement since we implemented PSR.

I have always said that PSR is a model that works in any demand environment. We right-size our assets for the business, whether that’s a booming economy or a downturn, and continuously adapt our network to shi ing demand. Now we have an opportunity to reshape our network to meet the needs of this moment. I could not be more proud of the hard-working CP and KCS railroaders who helped to make our historic combination happen, and I look forward to achieving great things together as we o er new services to our customers.

30 Railway Age // April 2023 railwayage.com
Canadian Pacific

Investing in America to transform the future of rail

Siemens Mobility is investing in America. With increased demand for passenger rail, we are expanding our manufacturing footprint by building a $220 million advanced and sustainable manufacturing and rail services facility in Lexington, NC. The facility will create more than 500 new jobs and produce some of the most innovative and sustainable passenger trains in the North American market.



The Greenbrier Companies VIRTUAL SAMPLE RAILCAR™

Quality, time and cost are three attributes customers seek in a relationship with a supplier. At The Greenbrier Companies, where long-term relationships with the customers who acquire our railcars are the foundation of how we conduct business, we’re always looking to deliver the highest-quality equipment in a time- and cost-effective way. It’s all about value. Virtual Sample Railcar™ (VSR™), our innovative way for customers to remotely inspect build quality, right down to the welds, is big part of our value equation.

VSR™ brings customers into Greenbrier’s six North American carbuilding plants from the convenience of a conference room or home office, providing full access to a sample railcar, with all the information needed to determine it meets all specifications and will be delivered as ordered. A narrated high-resolution “walk the line” video follows a carbody-to-coupler build with tools like high-resolution photos and

360-degree views, concluding with a live-stream inspection from the plant’s buy-off area. The traditional in-person process normally requiring three or more days, limiting the number of people who can participate in an inspection, now requires about an hour, accommodating multiple participants. Travel time and cost are no longer limiting factors.

VSR™, first rolled out in 2020, is rapidly evolving into its second iteration, which we call “2.0.” We’ve learned a lot in the past three years and have gotten the process down to a science. Drawing upon best practices from all our North American plants, the technology and equipment have improved, requiring only modest infrastructure investments. VSR™ 2.0, customized to individual customer requirements, offers a recording option, with hi-res images stored safely and securely on a cloud platform. Such features as live lining millage thickness measurements have been added.

Christian Garza, Quality Coordinator and Administrator at Greenbrier’s GIMSA plant in Monclova, Mexico, describes typical VSR™ steps: “Our four priorities are safety, quality, respect for people, and customer satisfaction, which carry through the entire inspection process. We

start with a safety inspection, showing that blue flags and wheel stops are in place. We explain to the customer the different activities we will be doing during the inspection—for example, operating couplers and hand brakes, showing every component and its supplier. We verify compliance with Rule 16 of the AAR Field Manual, which applies to coupler operation; Rule 22, uncoupling levers and support brackets; Rule 13, handbrakes; safety appliances like footboards and side ladders; slack adjusters; and exterior markings. We verify transponder information. On a tank car, for example, we operate the bottom outlet valve handles and open the manway. We read the thickness of the exterior paint. We verify capacity, in gallons. We show all the reports and readings our Quality department takes during the process. So, our customer has a complete view of their entire railcar.”

Railcar interior linings are difficult to show with live streaming video, so we’ve employed 360-degree cameras that take detailed, gigapixellevel high-resolution photos, which are included in the VSR™ live session.

The VSR™ process is more interactive and collaborative than an in-person inspection. Consider space: An in-person inspection is

An innovative, costeffective, time-saving way to inspect and approve build quality.

limited in the number of people that can be around a railcar. A customer will send one or two people to an inspection, but they might have a whole team of a dozen or more who would like to have the experience as a training tool. With VSR™, we can accommodate them (one customer had more than 25 people join a call). Component suppliers can join a call if the customer requests it. We can get a lot more voices and people involved. A sample car inspection with Greenbrier’s engineering and production teams can be accomplished in just one call, whereas traditionally, it could take an entire day. And sending people to an in-person inspection isn’t as cost-effective: Whether it’s one person or two or three, travel and lodging are expensive and time consuming.

“Over the past few years, we have purchased several hundred railcars from Greenbrier,” says Bobby Triesch, Vice President and Regional General Manager, SA Recycling. “With our most recent tranche of railcars, they told me of their new VSR™ experience and proposed that we use this process to confirm our approval and acceptance of the railcars. We agreed and participated in the VSR™ experience, and it was very impressive. I was able to see very-high-resolution photos and videos of the exterior and interior of the cars, as well as all of their mechanical systems. I truly believe I was able to see and inspect more of the railcar than was done with me walking in the plant next to the railcars. This is a great technology improvement, as well as a cost saver and efficiency tool. This new experience is the future. We were happy to participate, and would encourage others to consider VSR™ for their organizations.”

“Most of our customers have signed off on VSR™ and are using it with confidence,” notes Greenbrier Vice President of Marketing Tom Jackson. “We’re confident that this Greenbrier innovation is meeting their expectations for quality, time and cost.”

“In a given year, we conduct more than 100 sample railcar inspections,” adds Greenbrier Senior Sales and Marketing Manager Mallory Moran. “Think about it: 100 hours versus 300 days, with better collaboration among more people, and all the information they need to ensure that their railcar is exactly what they ordered, with the build quality upon which they’ve come to depend.”


We Must Look at Challenges as Opportunities

United States f reight railroads, particularly when viewed through the lens I confront in Washington, face three primary challenges that should more aptly be considered opportunities: furthering safety advancement, improving employee relations and providing strong service. As railroaders know, these issues are inextricably linked.

First, while safety has always been the industry’s top priority—a point I recently emphasized in Congress when noting that 2022 marked the best year ever for incidents involving hazardous materials and for main line derailments—the need to make progress in the march to zero is ever present.

Already, railroads have announced a set of actions they are taking in the near term to deploy the tools available today, with a keen focus on detectors. Railroads are installing approximately 1,000 additional wayside hotbox detectors on the national network, standardizing critical alert thresholds for these systems, and analyzing and adopting new industry standards for trending analysis protocols to preempt potential problems.

At the same time, railroads are taking a more scrupulous look at infrastructure and equipment, such as cars. is is why AAR recently took new cars prone to derailmentcausing loose wheelsets out of service for repair and forbid interchange until those wheelsets are replaced. Quietly yet continually, railroads will continue to invest in modern technologies and equipment—such as autonomous track inspection—implement safety protocols and prioritize safety training for their employees.

e industry does not need any additional incentive to be safe—it is core to all that we do—yet an opportunity exists in the months ahead to outline our track record and our vision for zero incidents. We will lead with actions.

Notably, employees play a critical role in maintaining safe operations and should be commended. Coming o a round of collective bargaining that ended di erently than anyone would prefer, however, management and unions have work to do to restore greater trust needed to ultimately grow the business in ways that bene t everyone. Beyond pay and healthcare that rank in the top 10% of

all industries, I hear from AAR members about their e orts to build stronger relationships with employees, seeking to create a more positive work environment, increase job satisfaction, and reduce turnover rates in the process. is will ultimately lead to a more e cient and productive workforce and bene t both the employees and the company.

We are seeing this payo as railroads continue to announce progress with unions on quality-of-life issues like more predictable work schedules and additional sick leave, momentum that seems to be compounding. Additionally, the rail employee base is currently the highest it’s been in more than three years, including among train and engine workers where growth is more than 11% this year.

Bargaining is an evolutionary process that builds on itself over time, and further progress is a clear opportunity.

Last, supported not only by safe operations and employees but also investments that will again top $20 billion, railroads have an opportunity to build on recent service improvements this year and beyond. Recent STB reports show railroads are meeting six-month targets for service improvement, with key performance indicators trending in a positive direction—including velocity, terminal dwell, operating inventory and trip plan compliance. Average train speed in the fourth quarter of 2022 improved across much of the network.

To date this year, while intermodal is down due to depressed imports, carload tra c continues to show some bright spots. Boosting visibility into network shipments, as we are seeing with new so ware solutions, while also maintaining greater resiliency in the system, will only help deliver the reliable and e cient transportation services customers expect and deserve.

As leaders in our industry, after several years of disruption, we must look at challenges as opportunities. Alongside our customers and supply chain partners, railroads have confronted a mix of supply chain disruptions, labor challenges, extreme weather events and changing consumer demands. Nonetheless, railroads have proven robust. Railroads will continue to play a vital role in supporting economic growth one opportunity at a time.

34 Railway Age // April 2023 railwayage.com

Strategic Priorities: Safety, Sustainability

Rail is one of the most efficient and sustainable means of transporting goods across North America, and as an industry, safety is at the forefront of all we do. At Progress Rail, we are committed to empowering our customers and the railroad industry to meet their individual and collective safety, sustainability and operational goals and commitments

Progress Rail is a wholly owned subsidiary of Caterpillar Inc. In our most recent Sustainability Report, Caterpillar Chairman and CEO Jim Umpleby commented, “Our long-standing commitment to sustainability inspires us to set and achieve meaningful environmental, social and governance (ESG) goals and develop innovative products, technologies and services to support our customers on their sustainability journey.”

Progress Rail’s global rail customers are likewise focused on sustainability, with aggressive ESG targets that are changing the direction of the rail industry. In addition to being a strategic priority for our business, sustainability is one of Progress Rail’s ve core values. We are continually expanding our product and services o erings with innovative solutions to help customers achieve both their business and climate-related goals.

For example, technologies such as Talos™, Nitro Suite Decision Support Solutions and Powerview™ help customers conserve energy while maximizing their operating e ciencies. Although each product functions independently, combining these individual technologies further enhances sustainability and operational bene ts for our customers.

ese advanced rail technology products also provide the opportunity for railroads to enhance safety across their networks by managing in-train forces (reducing break-intwos), reducing yard congestion and identifying and alerting for buckled track and other track abnormalities.

Our Talos™ energy management platform o ers overall fuel savings and emissions reductions up to 15% by using machine learning and arti cial intelligence (AI) to analyze locomotive engineer behavior, encode train runs and optimize operations. Talos leverages automation technology to control the train throttle and dynamic brakes, letting engineers focus on safety and situational awareness. Unlike other energy management products, Talos’ use of AI to improve train handling and manage in-train forces assists in the prevention of break-in-twos that can lead to derailments.

Combining AI and modern so ware engineering, our Nitro Suite of yard and network optimization tools is designed to help railroads signi cantly reduce congestion, which

improves network velocity, decreases yard dwell time and minimizes noise and emission impacts in surrounding communities.

While PowerView began as a locomotive event recorder, through continued innovation and extensive collaboration with the Caterpillar automation team, it has grown into its own suite of products and applications that provides real-time asset tracking and performance and fuel monitoring to the back o ce.

According to AAR data, two of the top ve causes of derailments in North America are buckled track and track geometry. PowerView Detect utilizes smart cameras, embedded machine vision algorithms and AI to examine and monitor track conditions and measure track de ections. Additional algorithms monitor ballast conditions and wayside infrastructure, as well as provide object detection. Combining smart camera data with locomotive operational data from the event recorder, PowerView Connect uses neural networking to identify data trends and generate custom alarms to warn operators and railroads of potentially dangerous track conditions.

In addition to these products, as a locomotive OEM and in line with our commitment to sustainability, Progress Rail is leveraging the scale of Caterpillar to accelerate alternative fuel options to the railroad industry. We believe our alternative fuel o erings—biodiesels, battery and hybrid and hydrogen, including modernization and repower options to extend the useful life of current eets and make them more productive and reliable— will best position the railroads to meet and achieve their 2030 and 2050 decarbonization targets and commitments.

e men and women who walked before us developed an industry that truly serves as the backbone of the North America economy. Last year we celebrated the 100th anniversary of EMD, and 2023 marks the 40th year of Progress Rail. Personally, it is humbling to lead a team that has contributed so much to such an iconic and vital industry for North America and beyond. As I settle into my role as CEO and we work to build upon the foundation built by our predecessors, Progress Rail will strive to provide products and solutions across our track, signal, freight car and locomotive product lines that contribute to the safety, sustainability and operational goals of our customers and partners.

railwayage.com CEO PERSPECTIVES April 2023 // Railway Age 35
Progress Rail

Investing in the Future of Rail. Investing in Lexington, N.C.

Growth. It happens every day, all around us, in every aspect. Our nation’s rail routes grow to meet passenger and freight operator needs, ridership grows to create community connection and businesses grow to meet consumer demand. at’s no di erent for our team at Siemens Mobility. With intercity travel continuing to surge, infrastructure investment becoming a priority and public transit rebounding in the postpandemic world, we’re growing to better serve our customers and communities across the country.

Expanding to Lexington, N.C., will grow our North American footprint with a $220 million investment in a manufacturing and rail services facility on the East Coast. is new facility will sit on a 200-acre site, creating more than 500 new jobs and will begin production of passenger cars in 2024.

Our new East Coast hometown, Lexington, is known for its NASCAR history, award-winning wines, and of course its world-famous barbecue. But what really makes Lexington special is its people. With its extensive history in manufacturing and its small-town atmosphere, Lexington is home to many hardworking, dedicated and skilled workers whose purpose to create a better tomorrow aligns directly with ours—and I look forward to bringing the rail manufacturing industry to this great city.

What I’m calling our “Factory of the Future,” this passenger coach manufacturing facility and service hub will feature rst-of-its-kind locomotive and passenger coach overhauls and will build on some of the latest technologies found around the world. e new Lexington plant will include robotic welding, 3D printing and Virtual Reality weld training, as well as so ware

tools to enhance our manufacturing. is facility will also be carbon neutral, enhancing our commitment to sustainability in both our own operations and in the products we produce.

In addition to implementing the latest manufacturing technologies in Lexington, we’ll also be introducing workforce development programs we’ve seen have great success in Sacramento. Building a local pipeline of manufacturing workforce, we plan to implement education and training systems with local trade schools and colleges in addition to our own weld training program. We also aim to make starting a career with us accessible to many individuals by o ering internships and entry programs so that our future Lexington team sees us not just as a job, but the start of a career. We expect to begin recruiting and training in the summer of 2024.

Grateful for the success we’ve seen here in North America, I recognize our achievements would not be possible without our impressive workforce across the country.

at is more than 4,000 hard-working employees in our eight manufacturing facilities across the United States and Canada working to transform the future of rail in America, and they are the backbone of our business. e process to build a new facility cannot be done overnight, nor can it be done without the expertise that lives within Sacramento and across our other sites.

What began as a small vehicle assembly facility in Pittsburgh in 1983 and later expanded into a full-scale rolling stock manufacturing facility in Sacramento, our legacy of American manufacturing and investing in local communities has spanned more than four decades. We have been transforming the way Americans travel since the 1980s, and this investment in American rail allows us to continue adding to our more-than 2,000 U.S.-based suppliers and 3,000 vehicles, and our evergrowing workforce.

Our nation is projected to grow in population by another 100 million in the next 40 years, and the rail industry must grow with it to keep up with demand. Now is the moment in time for rail in America— a growing nation, a growing industry, and one company growing to better transform rail in America.

36 Railway Age // April 2023 railwayage.com CEO PERSPECTIVES
Siemens Mobility


Build Trust to Grow Market Share

Houston, we have a problem.”

at infamous radio message—sent 200,000 miles from Earth—alerted the world to a cascade of failures on the Apollo 13 moon mission. e response by respected NASA ight director Gene Kranz to his control team immediately set their direction at a critical moment: “Tell me what we have that’s good.” ough

the rail industry is not Apollo 13, we do have a problem. Stakeholders are recoiling from their own cascade of negative perceptions and experiences with railroads.

As a result, the Surface Transportation Board (STB) held hearings where angry shippers vented about bad service, rate increases and embargos. Congress felt it necessary to solve a labor impasse—a very public way to advertise bad labor relations

and lack of trust. Recent Senate hearings on rail safety united two unlikely allies—U.S. Senators J.D. Vance and Bernie Sanders — talking about corporate greed. Now there is a bi-partisan group of senators proposing a law that could create many unintended and negative consequences.

Most troubling, perhaps, is that the U.S. railroad freight industry has steadily lost market share for more than a decade.

According to Rick Paterson, Managing Director-Equity Division, Loop Capital Markets, had the railroads simply kept pace with rising U.S. industrial production since 2004, volumes would be at least 15% higher than they are today. Worse, if they matched real GDP, volumes would be 42% higher, and if they matched ATA truck tonnage growth, 56% above what the industry handles today.

So, as Gene Kranz asked, what is good?

ere are many things, starting with dedicated front-line workers and managers who worked honorably and heroically to keep the wheels moving through COVID. ese workers were rightly called “essential.”

In addition, we have a record of improved safety performance over the past 20 years that is truly remarkable. ere is more to be done, and new technology promises bene ts for employees, shippers and communities.

Railroads have built a physical plant that is arguably in the best shape ever, with capacity for growth. at growth can be quickly realized because there are plenty of freight cars and locomotives parked for a lack of business.

New and innovative operating models can tap short haul markets that currently default automatically to truck.

ere is a growing recognition of the profound capability railroads o er to realize climate goals. Shippers—under pressure to reduce Scope 3 emissions from external activities and assets that are nevertheless part of their supply chain—see freight railroads as a signi cant solution that’s in plain sight. ese fundamental environmental advantages are being enhanced by the railroads’ real-world battery and fuel cell technology tests.

Finally, short line and regional railroads have continued to inject needed entrepreneurship into the industry, while enhancing critical relationships with customers. This segment of the industry has continued to grow volume by offering

38 Railway Age // April 2023 railwayage.com
Anacostia Rail Holdings

services that customers value.

All of this is what we have that’s good. What will it take to use these strengths to transform our industry into one that can grow market share?

e answer: Build trust and credibility by performing in ways that substantially exceed the pre-COVID “normal.” To do more than manage decline, we must:

• Recognize that many relationships need repair, including with employees, customers, short lines and other business partners, as well as with federal, state and local governments and regulators.

• Invest in the human resources necessary to make change happen.

• Provide customers with tools that enable real-time shipment visibility.

• Educate Wall Street on the primacy of growth—rather than operating ratios—by having the courage to implement aggressive growth strategies.

• Cultivate short line business partners to develop growth.

• Improve the work/life balance for our

employees—something that is long overdue.

• Adopt technologies that will enhance safety and e ciency, working with regulators when necessary. Don’t leave all the innovation and R&D to the supply industry.

• Leverage environmental bene ts for share growth and public policy support.

e safe return to earth of a wounded

spacecra ’s crew more than 50 years ago has relevance to our industry today. Let’s take the hard lessons learned, “ nd the good,” and create real bene ts for customers, investors, employees, communities, U.S. competitiveness and the environment. at’s how we’ll grow our modal share and build trust.

• TestingandTroubleshooting26-Type LocomotiveAirBrakeSystems

• LocomotivePeriodicInspectionand FRARulesCompliance

• LocomotiveElectricalMaintenanceand Troubleshooting

• LocomotiveAirBrakeMaintenanceand Troubleshooting

• DistributedPowerMaintenanceand Troubleshooting

• DistributedPowerOperations,Training,and OperatingRules


• FreightCarInspectionandRepair

• SingleCarAirBrakeTest

• FRAPart232BrakeSystemSafetyStandards forfreightandothernon-passengertrains

• TrainYardSafety


• TrackSafetyStandards

April 2023 // Railway Age 39 railwayage.com CEO PERSPECTIVES
William C. Vantuono
Progress Rail EMD® Joule SD40JR battery-electric switcher built for Anacostia subsidiary Pacific Harbor Line, testing at MxV Rail, Pueblo.
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Railinc’s analysis of the North American revenue-earning eet reveals that the total eet increased in 2022 with almost all car types accounting for the gain. One of the smallest car types, hoppers, continued declining in 2022. e average age of cars in the revenue-earning eet was up, and new cars continued to trend on the larger side, with the majority having gross rail loads (GRLs) of 286,000 pounds.

is report from Railinc represents the period ending Dec. 31, 2022. It provides an industry overview of the North American railcar eet, detailing essential rail equipment statistics and overall rail equipment trends. Railinc compiled all data in the

report from its Umler® system.

e Umler® equipment registry contains the physical characteristics, transportation management, and pool assignments of more than two million pieces of rail equipment in North America. It is updated nearly one million times each month.

e revenue-earning eet is largely composed of freight cars that can be used in interchange service and against which an interline waybill can be placed. e North American rail equipment eet also includes locomotives, end-of-train (EOT) devices, maintenance equipment, etc., which are not included in this report. In context, the revenue-earning eet totaled 1.63 million units, while the total count for railroad equipment of

all types was 2.09 million units.

e revenue-earning eet is made up of six sub eets: hoppers, covered hoppers, gondolas, ats, tank cars and boxcars. It excludes locomotives, intermodal trailers and containers, maintenance-of-way equipment, and EOT devices. Because not all intermodal trailers and containers are registered in the Umler® system, Railinc does not report them as part of the revenue-earning eet.


Detailed analysis reveals the following trends:

1. e size of the revenue-earning eet increased in 2022. e total eet size was up 0.4% from year-end 2021 to year-end 2022, compared with a 1.4% decrease the National Steel

40 Railway Age // April 2023 railwayage.com


previous year.

2. Nearly all car types recorded gains in the revenue-earning eet. Covered hoppers, gondolas, ats, tank cars and boxcars all saw gains, with boxcars—the least populous car type—up 2.6%. It was, however, the 13th consecutive year of decline for hoppers, down 2.0%.

3. e average age of the revenue-earning eet continued to climb in 2022. e average age rose to 20.1 years, its highest in more than a decade, continuing to suggest new cars were joining the eet at a slightly lower rate than older cars were exiting last year.

4. e trend of GRL 286 cars predominating among additions to the revenue-earning

eet continued in 2022. e number of GRL 286 cars added to the eet increased by about 29% in 2022. ese cars accounted for 96% of all new additions in 2022 and about 87% in the past decade. Larger cars enable operational e ciencies that reduce costs and ease logistics challenges.

e revenue-earning eet realized a net increase of 7,000 cars in 2022. At the end of 2022, the revenue-earning freight car eet totaled 1.63 million units, up about 0.4% from the previous year (see Figure 1).

Hoppers were the single car type that decreased in the revenue-earning eet, down by 2.0% over 2021. All other car types increased in 2022, with boxcars leading the gains by 2.6%.

e average age of railcars in the revenueearning eet in 2022 was 20.1 years, a 0.3-year increase from 2021. e average age continues to hover around 20 years as it has for the past decade (see Figure 2). e slight increase in the age of the eet in 2022 suggests that new cars are being added at a slower rate than old cars are exiting.

About 64,000 new cars have joined the revenue-earning eet in the past two years (see Figure 3, p. 42). e number of new cars added in 2022 increased 28% over 2021.

Railcars with a GRL of 286,000 pounds have made most of the new additions to the revenue-earning eet in the past 25 years. Over that time, GRL 286 cars have accounted for 83% of all new additions to the eet. is

April 2023 // Railway Age 41 railwayage.com
Figure 1: North American Freight Car Fleet, By Car Type Counts At Year-End, Shown In Thousands Figure 2: North American Freight Car Fleet Average And Median Age

trend continued in 2022, as 96% of new equipment were GRL 286 cars (see Figure 4, p. 44).

e number of GRL 263 cars added in 2022 decreased by about 975 cars from 2021.

GRL 286 cars dominate among recent additions to the eet because they enable operational e ciencies that reduce costs and ease logistics challenges. e eet continues to add GRL 263 and GRL 268 cars, but at a much lower rate than GRL 286 cars. New GRL 220 cars also joined the eet a er seeing no cars added in 2021. e last year non-GRL 286 cars led among new additions to the eet was 1992.


More than 700 equipment type codes (ETCs) appear in the Umler® equipment registry. Of those, 10 ETCs accounted for 52% of the revenue-earning eet in 2022. For the ninth time since Railinc began producing this report in 2011, nine of the top 10 car types were either tank cars or covered hoppers—the two largest car types in the revenue-earning eet. e 2022 rankings remained static compared with the previous year, with no car types in the top 10 exchanging places.

As the demographics of the car types change, so do the average car size and the total combined capacity of all the units in a car type. For example, with the growth in the

tank car population, the total eet capacity has increased by 56.1% since 2009. Most new tanks are large, which has pushed the average car size up by 7.9%. e total eet capacity for covered hoppers has increased, as well, by 22%. However, the average car size has decreased slightly because most new covered hoppers are smaller.

In the past decade, the boxcar population has decreased, which has driven down the total eet capacity. Large boxcars have joined the eet, which led to an increase in average car size, but not at a fast enough rate to o set the population loss.

Several equipment types comprise the revenue-earning eet. is section of the report presents select car types by the kinds of commodities they carry. is provides a more nuanced view of these car types. For example, while covered hoppers carry grain, sand, plastic pellets and other commodities, the types of covered hoppers that transport each commodity are very di erent in their characteristics.

e report takes a deeper look at a few of the car types, including covered hoppers, gondolas, open hoppers and boxcars. ese car types were selected because they carry commonly shipped commodities and make up a sizable percentage of the revenue-earning eet.

Figure 3: North American Freight Car Fleet Number Of Cars By

Plastics: Covered hoppers are commonly used to ship plastic pellets. is commodity sub eet added about 10,000 cars in the past two years, about 20% of what was added in the previous 10 years combined. Cars with equipment type code C214 comprise nearly the entire commodity sub eet as de ned here, make up 9% of the revenue-earning eet, and are the second-largest equipment type. New railcars have trended larger. Of the cars added to the commodity sub eet in the past 20 years, about 94% have had a capacity of 6,000 cubic feet or more.

Grain/Fertilizer: Railroads move grain and fertilizer in large covered hoppers. e grain and fertilizer sub eet added about 12,000 new cars in the past two years and make up about 17% of the revenue-earning eet. Two types of covered hoppers—C114 and C113—account for about 96% of the commodity sub eet and are in the top ve of the most populous equipment types in the revenueearning eet. Larger covered hoppers with capacities of at least 5,000 cubic feet have made up nearly 88% of the additions to the commodity sub eet in the past 20 years.

Sand and Cement: Railroads move sand and cement using small covered hoppers. Over the past 10 years, the revenue-earning eet has added almost 51,000 covered hoppers with

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an equipment type code of C112. About 96% of the sub eet is comprised of C112s, which was the third-largest equipment type in 2022. Because of the density of sand and cement, the cars that carry these commodities tend to be smaller. Of the cars in the sub eet, almost all have a capacity of just over 3,000 cubic feet. Only about 3% of the sand and cement cars have capacities less than 3,000 cubic feet, and practically no cars of this size have been added to the sub eet in almost 25 years.

Coal: is commodity is shipped primarily in gondolas and open hoppers. ese cars

still made up a sizable portion of the revenueearning eet—10%, or 170,000 railcars—in 2021 and 2022. About 77% of those cars were added between 1990 and 2013. Nearly all the coal-carrying railcars added in the past 30 years have been GRL 286 cars.

Aggregate: Aggregates such as limestone and crushed stone are shipped in gondolas and open hoppers. e number of these car types added to the revenueearning eet in 2022 and 2021 was several times greater than those added in the previous two-year period. Nearly half the cars in

the aggregate commodity sub eet have been added in the past 16 years, though they make up only 2% of the total revenue-earning eet. About 96% of all cars added to this commodity sub eet in the past 12 years have been GRL 286 cars.

Boxcar Commodities: Boxcars are the least populous car type in the revenue-earning eet and are used to ship a wide variety of products, from consumer goods to automotive parts. e boxcar eet is older than other car types. As older and smaller boxcars continue to age out of the eet, new larger boxcars continue to be added. Boxcars with a GRL of less than 286,000 pounds make up about 36% of this car type, but most of those were built more than 40 years ago.


e North American railcar eet grew in 2022. e total size of the revenue-earning eet increased a er two years of decreases, up 0.4% from year-end 2021 to year-end 2022.

e revenue-earning eet added cars in almost all sub eets—boxcars increased the most, up 2.6%, followed by gondolas at 2.0%. Only hoppers decreased, falling by 2.0%. e average age of cars in the revenue-earning eet increased to 20.1 years, suggesting new cars are joining the eet at a slightly lower rate than older cars are exiting. GRL 286 cars continue to predominate among new additions to the revenueearning eet. is size of car accounted for about 91% of all new additions to the eet in 2022.

Railinc is a wholly owned subsidiary of the Association of American Railroads. For more information and to download this report and related materials, visit www.railinc.com.

44 Railway Age // April 2023 railwayage.com RAILINC FREIGHT CAR REVIEW 2023
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Figure 4: North American Freight Car Fleet Number Of Cars By Age and GRL
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Foundational to the freight and passenger rail network, crossties handle pressure from all sides—from train weight to Mother Nature.

Crossties not only support rails and high-tonnage trains, transferring weight to the subgrade, but also perform under extreme weather conditions and help hold gauge over time with proper maintenance, treatment and restoration. Traditionally made of wood, the tried-and-true mainstay, crossties produced from concrete are common in high-speed rail and transit applications and on heavy-axle-load freight railroads with steep grades, sharp curves and high annual gross tonnage. Ties produced from composites, plastics or steel are available for specialized applications.

e following suppliers provided Railway Age with insights on the 2023 market, plus updates on their products and services.


Arxada o ers Chemonite® ACZA to treat and extend crosstie life. Its bonds are leachresistant, and the wood surface remains “nonoily and clean-to-the-touch,” even in high temperatures or when exposed to salt water, according to the manufacturer. A treatment mixing Chemonite® ACZA and borates is also available. “Like ACZA, borates have a long history of e ective decay prevention,” Arxada says. “ ey have been used for decades to

supplement other preservatives in protecting hard-to-treat species of wood in heavy-duty industrial environments. e borates di use deep into these species, protecting inner areas that might otherwise be vulnerable to decay when exposed by cracks or wear. Borates also inhibit corrosion, enabling spikes to maintain their integrity for a longer period of time and thus hold gauge longer.”

Marketing Professional Belinda Remley reports that Arxada is continually innovating its products to prolong the life, and therefore the use, of wood. “We continue to study the performance of Chemonite® ACZA and Chemonite® ACZA plus Borate ties and are pleased with their

April 2023 // Railway Age 45 railwayage.com
Tech focus – M/w: CROSSTIES
Koppers Inc.
Koppers treated crossties.

longevity,” she says. “Currently, the entire wood industry has turned its attention to include engineered wood for mid-rise structures as well as assisting in maintaining our infrastructure.”


“A er a steady increase in North American concrete tie manufacturing capacity over the past decade, followed by a precipitous drop in demand just before and during COVID, there is ample capacity for increased tie volumes to feed heavy haul, industrial and light rail construction projects,” Engineering Manager Vince Petersen tells Railway Age. “With West Coast transit nally starting to get back up to speed, especially in California, CXT sees opportunities for increased volumes ahead.”

Additionally, Class I yard modernization and expansion projects across the West “are breathing new life into industrial projects, a mainstay of CXT’s business,” he notes.

What are customers requesting most o en these days? “Quite frankly, with recent in ationary pressures on every one of our materials and the tight labor market, customers are looking for cost-saving designs and proactive terms to hold rm their construction budgets,” Petersen says. “Taking advantage of the increased tie spacing allowed with concrete ties without sacri cing track strength has been a strong seller for CXT. Creative storage terms have enabled us to feed material to their project sites on an as-needed basis to help our customers maintain their project schedules and costs.”

CXT is currently partnering with fastener suppliers to introduce new heavy-haul rail fastening systems for concrete ties. “ ese new systems aim to reduce wear and degradation on

polymeric fastening components from lateral forces due to faster train speeds and more tonnage to meet increasing tra c demands,” Petersen explains.


For nearly 20 years, Encore has helped railroads and contractors extend crosstie life, providing tie plugging equipment and compounds for wood and composite ties as well as concrete tie repair equipment and compounds. It o ers more than 100 pieces of equipment for lease, with full eld support and training, including ride-on, walk-behind and skid-mounted (portable) tie pluggers. Its most-o en requested machine is the high-production ride-on, according to Charlie Briggs, Field Service and Sales Manager, because it gets “boots o the ground,” allowing one to two operators to work safely inside. Track-mounted and selfpropelled, it is equipped with GPS for tracking. Additionally, Encore reports that the

dual-dispensing, low-maintenance guns reduce cleanup time, and up to 250 gallons of tie plugging compound can be stored onboard. e ride-on for high-speed rail seat abrasion repair—also track-mounted and self-propelled—allows users to switch application guns for wood or concrete ties. Briggs says Encore is now updating its machines’ electrical systems to CAN Bus, and continues to focus on dispensing system updates to reduce maintenance and decrease downtime.

While Encore continues to build relationships in North America—including those with CN, Union Paci c, Ferromex and Canadian distributor Davanac Inc.—it is also eying international work, and partners with American Equipment Company, an export management company specializing in the sale of railroad equipment worldwide, according to Briggs.


For crosstie and switch tie provider Koppers, product demand remains strong. “ e hardwood market has relaxed as expected, and with increased purchasing power we are seeing a steady ow of raw material into our plants,” Director, Class I Sales John McDonald says. “ e global coal tar market continues to face disruptions, putting pressure on pricing and availability to meet the demands of our industry. We see this trend continuing for the foreseeable future.” But as a vertically integrated supplier of both wood preservatives and treated crossties, he says, “Koppers is in the best position possible to creatively navigate through these challenges to meet customer demands.”

e company’s acquisition of Kirkwood, Mo.-based Gross & Janes in 2022 further strengthens that vertically integrated business model, providing “value to our customers by de-risking their supply chains for critical products,” McDonald points out. “ e Gross & Janes network, assets and sourcing footprint is highly complementary to Koppers’ and aligns well with our long-term strategy. Maintaining a normalized inventory of high-quality untreated crossties will expand capacity and open new markets.”

Koppers is now in the nal stages of commissioning a new treating plant in North Little Rock, Ark. Additionally, McDonald reports that “ eld research suggests that wood crossties treated with Koppers CPS (Creosote Petroleum Solution), through advanced treating technology and introduction of borates, is exceeding life-cycle performance expectations.”

46 Railway Age // April 2023 railwayage.com
CXT/L.B. Foster: No. 24 turnout retrofit to a 15-foot track center crossover in Orange County, Calif. CXT/L.B. Foster, top; Encore, bottom Encore: EnduraPlug™ Tie Plugging Compound.
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Vice President of Sales Matt Violin tells Railway Age that the crosstie market “remains strong with continued growth throughout all areas of the railroad industry. Many rail operators are converting to NARSTCO steel ties and turnouts over alternative products due to their longer service life, ballast savings, consistent gauge holding capabilities and ‘green’ features. We continue to see activity throughout North America within the port and intermodal networks. e automotive industry, speci cally related to EV development, has an extremely positive outlook with many opportunities for rail and ‘green’ rail products. e petrochemical industry remains strong with more facilities coming on line now and in the coming years.”

NARSTCO recently secured the largest steel tie and turnout order in company history for a Chevron Phillips Chemical project under construction in Orange, Tex. It also supplied steel ties and turnouts to a new steel mill for Big River Steel, a U.S. Steel company, in Osceola, Ark.

“NARSTCO’s products help the project team meet their goals by reducing their carbon

footprint and utilizing recycled U.S.-made steel,” according to Violin. “ e ability to build track faster with reduced ballast quantities and optimizing their total cost of ownership are all key aspects being considered.”


“ e current estimates suggest that the overall [wood crosstie] market is down from last year due to the lingering e ects of the green tie shortage, with a projection of 18-19 million ties

for this year vs. 21 million last year,” Eastern Region Sales Manager Je omas reports. “ at said, we are seeing more so woods like southern yellow pine enter the market as exports of hardwoods tick up.”

Nisus continues to see steady growth of its QNAP® copper naphthenate wood preservative product. “ is trend holds true for the utilities with poles, as well as in the railway industry where we’ve seen especially strong growth with bridge ties, in particular,” says Dr. Mark Manning, Business Development Manager.

Nisus expects the QNAP growth trajectory to continue, “especially when considering the creosote shortages we’re hearing about from treatment plants and the restrictions on the marine shipping of creosote,” adds Dr. Je Lloyd, Senior Vice President, Innovation and Sustainability. Between that, he says, the EPA’s cancellation of wood preservative pentachlorophenol, “increasing environmental awareness and the wider array of disposal options for QNAP-treated wood at end of life, you can see why the demand for QNAP has been so high.” e company is also seeing an increase

48 Railway Age // April 2023 railwayage.com
NARSTCO NARSTCO: Steel ties and turnouts at U.S. Steel’s Osceola, Ark., facility. Visit www.Stella-Jones.com or call 1.800.272.8437 ® 1.800.272.8437 www.stella-jones.com © 2019 Stella-Jones Corporation. All Rights Reserved We’re ready to work with you today; across North America and in your backyard. Stella-Jones unique advantage for customers is the breadth of products and services that we provide. We are Strongertogether. Crossties & Switch Ties Bridge Timbers & Panelized Decks Borate Pre-Treatment Highway Grade Crossings QNAP Bridge Timbers Tie Plants (13) Crosstie Distribution Yards (8) Procurement Yards (18)

in the use of borates, in general, due to the market trend toward so woods, omas says.

What are customers looking for? “Cost is always a factor,” omas says. “ at’s why we always stress what borates can do. Dual-treating ties with Cellutreat and QNAP dramatically extends their service life and reduces disposal costs. at makes a big di erence in the railroads’ bottom line.” e company is currently developing strategies for dual-treating switch ties so they are available on demand, he says.

Additionally, Nisus is looking into methods for implementing “protection by design,” speci cally through top covers for bridge ties to extend their life, investigating best practices for tie recycling and additional end of life uses, and carrying out multiple international eld tests to support registration in Europe due to creosote restrictions, according to Lloyd.


Stella-Jones supplies more than 12 million pressure-treated wooden crossties per year. It o ers not only railway ties and timbers for Class I, short line and commercial railroad operators, but also industrial products—including wood for railway bridges and crossings, marine and foundation pilings, and construction timbers—and customized services. Preservatives for mixed hardwood and oak include creosote, borate and copper naphthenate.

“Overall crosstie demand continues to remain strong as many of our Class I customers continue to take advantage of track time for program maintenance and to build new or extend existing sidings to improve service,”

reports. “Our short line and regional customers continue to take advantage of the 45G Tax Credit and Federal Railroad Administration CRISI grants to fund track improvements and new business opportunities for customers switching to rail for their transportation needs. Additionally, green tie production has started to improve over the past six months, and the company expects that trend to persist.”

Stella-Jones is eying capital projects to improve plant capacity and safety as well as ESG initiatives, according to Caric. It recently completed a 2,100-plus solar panel installation on two roofs of its Clanton, Ala., treating plant. is project was designed to cover 70% of the facility’s electricity needs. “In terms of CO2 emissions avoidance, this energy coverage is equal to 92,000 gallons of diesel consumed annually and marks a meaningful step in our road to decarbonization,” Caric says.


In August 2022, EFG TieTek LLC, part of the EF Global Group, acquired TieTek Global and its related entities. e following month, TieTek Global participated in the InnoTrans trade show in Berlin, Germany, where interest in its composite crossties was “overwhelming,” says D. Elroy Fimrite, President and CEO of TieTek Global. “ ere is a signi cant movement globally to replace wood sleepers/crossties with a more sustainable and better performing product,” he reports. “TieTek sleepers/crossties have a quarter-century of solid performance, are composed of more than 80% recovered resources, and each sleeper/crosstie locks up more than 150 pounds/70 kilograms of carbon in a stable carbon

vault. At the end of the 50-year installed life expectancy, the TieTek crosstie can be recycled 100% back into a new product, a truly circular solution. Recapturing waste plastic and waste rubber, the manufacturing of the TieTek composite products is a net carbon minus process, which produces essentially no waste, emissions or byproducts. No special equipment or railbed modi cations are required to replace wood ties with the TieTek Composite crosstie.”


Nortrak, a vertically integrated design and manufacturing company, not only supplies concrete ties, but also produces in-house such components as ductile shoulders, plastic rail pads and insulators, and indented reinforcing wire. “Our customers demand the best quality with the lowest cost and by controlling our own supply chain we wring out ine ciencies to meet customers’ expectations in a very competitive environment,” Senior Vice President Strategy and Development Fixation John Stout says. He tells Railway Age that the company is seeing a modest recovery taking shape in the crosstie market, with a slight uptick in concrete tie and turnout demand as a result of capacity expansion and maintenance projects that had slowed due to the pandemic.

“We are optimistic about the long-term outlook for concrete ties as freight and passenger railroads look to increase the RAMS (Reliability, Availability, Maintenance and Safety) on their networks to increase revenue generating tra c and minimize the need to occupy the track for maintenance,” Stout reports. “In

50 Railway Age // April 2023 railwayage.com Tech focus – M/w: CROSSTIES
Nisus: A cross section of a yellow pine crosstie treated with QNAP, demonstrating the thorough diffusion of copper naphthenate. Nortrak: Keyway Tie System installation in Oregon. Nisus, top left; Nortrak, top right

addition, di culties hiring and retaining skilled track workers will likely persist making long-life/low-maintenance products like concrete ties a very attractive option.”

Nortrak’s Keyway Tie System, Stout adds, has gained wider adoption over the past year with multiple installations in the Paci c Northwest, along the Gulf Coast and in southeastern Canada. “All installations were completed in wood tie track where wide gauge was an ongoing maintenance and safety issue,” he says.

“ e Keyway Tie System immediately secured and stabilized the track gauge and since it has the same dimensions as a wood tie, it allows for a consistent track modulus with adjacent wood ties and can also be installed with typical maintenance-of-way equipment.”

e company has developed a specialized set of Keyway Transition Ties to bridge the transitions from xed structures to open track. Stout says Keyway Transition Tie Sets “minimize the ballast breakdown at approaches to turnouts, open deck bridges, grade crossings and other structures that o en lead to a dip in the track surface that result in high impacts on structures with accompanying maintenance and reduced service life of those high-cost assets.”


To ensure crossties hold gauge and to extend their service life, Wilvaco o ers wood tie plugging compound and concrete railseat repair and shoulder repair products. It also provides low-viscosity high modulus urethane for concrete structures. 2023 started o strong for annual m/w programs at the Class I’s, according to Rob Loomis, Vice President, Performance Products Division. With track time available and more workers in place, Wilvaco has had a busier rst quarter this year than last. e company’s goal is to help railroads reduce downtime, and its latest product, Spike Fast IJ-30, does just that. is insulated joint repair material cures in place and keeps the signal isolated, so the track stays open, Loomis says.

A growth area for the company is structural support, and among the products gaining traction are bearing pad repair, used at bridge approaches, and waterproo ng for concrete and steel structures. Also, on the transit and rail yard side, Wilvaco more recently began o ering a plinth repair product to hold fastener screws in place. It is used by such companies as Dallas Area Rapid Transit, Seattle’s Sound Transit and the Port of New Orleans.

the Awards Committee for REMSA, which in 2022 debuted an innovation award.


Omaha Track is celebrating 40 years of service this year. It has evolved from a retail landscape tie sales facility with three employees to a recycled railroad materials and services provider with 300 employees. e company tells Railway Age that it processes more than three million wood crossties per year, with 70% being recycled as biomass and the remainder repurposed as railroad infrastructure or used in landscaping. OT has also recycled and repurposed more than seven million tons of steel rail and other track materials since 1983.




VTT has been supplying ties across North America for more than 35 years. Its prestressed concrete ties are said to provide an improved track surface, alignment and gaugeholding performance; support high speed and heavy haul rail applications; and o er longer lifecycles with durability and resistance to weathering and corrosion.

e company tells Railway Age that 2023 started o with consistent demand as compared to previous years, with a slight uptick for specialty applications such as yards.

VTT recently introduced a newly engineered yard tie that it says was the result of Class I customer demand for a longer-lasting product. “ e 102 Yard tie is an economically optimized tie and fastener combination designed with less reinforcement and material for yards and a variety of transit applications,” the company explains. “We believe the cost e ciencies we have driven into this new tie and fastener design makes it extremely competitive to plated wood ties, coupled with a much longer lifespan as compared to traditional ties, thus driving a compelling return on investment for both new yard construction as well as total yard rehabs.”

While Wilvaco’s research and development e orts are “behind the curtain,” so to speak, Loomis says that the company is constantly working to simplify product application with the fewest possible steps. Innovation is key, according to Loomis, who also serves as Chairman of

OT is at work with universities and other industries to nd environmentally friendly tie disposal options, according to President Je Peterson. “ is is a longer-term goal, as the technologies are di cult to scale in an economically viable way,” he says. “We are optimistic about the potential for green alternatives such as biogas, biochar, woodgas and biocracking.” e company continues to explore the potential for using ground ties as a fuel source for other industries, and has had some success with cement manufacturers, reports Peterson, who notes that OT is “optimistic” about this market and is researching and developing other ideas. It is also teaming with equipment, engineering and manufacturing companies to develop a new product to improve the tiepickup process.

April 2023 // Railway Age 51 railwayage.com Tech focus – M/w: CROSSTIES
Omaha Track
Celebrating 40 years of service in 2023, Omaha Track has evolved from a retail landscape tie sales facility to a recycled railroad materials and service provider.


How they emerged from Conrail’s shadow.

Imagine going back 40 years to early 1983. e only passenger trains running along much of Amtrak’s Northeast Corridor (NEC) were operated by Amtrak itself. Otherwise, what was (and still is) the nation’s busiest passenger railroad line stood empty and silent. e trains that normally carried the “9-to-5 army” of commuters, along with other riders at other times, were all sitting in their yards.

When that happened, Consolidated Rail Corp. (Conrail) was forced to stop running local passenger trains, and the new statesponsored operators had not yet worked out the rules by which the trains would run. On both sides of the Hudson around New York City, and from Philadelphia outward in Pennsylvania, the local trains were sitting still. e sole exception was the Long Island Rail Road, which had operated under its own ag since 1834 and had never been part of Conrail.

ree new railroads—New Jersey Transit Rail Operations, SEPTA Regional Rail

and Metro-North—operated for only two months a er they were founded, until they were halted by labor disputes. It would take into April 1983 before the ones serving New York City started up again; SEPTA was out of service until July 3.

Conrail had risen from the ashes of seven bankrupt Northeastern railroads that ran freight trains throughout the Northeast and some of the Midwest, and passenger trains as far west as Chicago and St. Louis. ey included the short-lived and ill-fated Penn Central, the almost as short-lived Erie-Lackawanna, and morelocal railroads like the Central Railroad of New Jersey and the Reading, centered on Philadelphia. ose were the railroads that operated local passenger trains south of Boston, north of Washington, D.C., and especially in the New York, New Jersey and Philadelphia areas.

Conrail was established by the Regional Rail Reorganization Act of 1973 (3R Act). It was incorporated in 1974 and kept those trains running, starting on April 1, 1976.

Amtrak had taken NEC operations and long-distance trains off Penn Central’s hands in 1971, while the last Erie-Lackawanna long-distance trains had bitten the dust the year before. Conrail discontinued a few limited-service commuter lines in the late 1970s and transferred Southside service in Boston to the Boston & Maine (which had historically run Northside service) in 1977.

en along came the Northeast Rail Service Act in 1981, which mandated that Conrail give up its local passenger operations a er a transitional period of only 18 months. Time would be up as 1982 turned into 1983. Before the deadline date, Conrail discontinued some local services, while Amtrak picked up the limited commuter operation between Baltimore and Washington, D.C. that later became the MARC Penn Line.

Railway Age Contributing Editor Jim Blaze worked at Conrail at the time and participated in the transition. He said that Conrail management and the transit

52 Railway Age // April 2023 railwayage.com passenger rail focus
NJ Transit

agencies wanted a deal to transfer the trains from Conrail operation to local providers.

e bene t for the local providers would be local control of the services. Conrail wanted out, too. Its management had signi cantly underestimated the cost to rehabilitate the lines for freight service on account of deferred maintenance. Beyond that, deferred maintenance had also caused the anticipated cost of rehabilitating Conrail’s lines that hosted local passenger trains to increase, as well. ere also were not enough employees to keep maintaining the lines, which gave Conrail an additional reason to look for other operators.

As 1982 went and 1983 came and Conrail was out, there were suddenly three new railroads in the region. Each had a difficult birth experience, not only for their managers and other employees, but also for their riders.

Walter E. Zullig was General Counsel for New York’s Metropolitan Transportation Authority (MTA) and led the original incorporation papers for Metro-North. It was known as the Metro-North Commuter Railroad Co. when it was formed in September 1982. Peter Stangl was Metro-North’s rst president, and the railroad was part of the MTA. Zullig told Railway Age that the MTA had been involved in tripartite negotiations with the Connecticut Department of Transportation (ConnDOT) and the trustees of Penn Central since 1971. Sen. Jacob Javits (R-N.Y.) secured an amendment to the statute, which said that Conrail would take over the contracts, but the details of that takeover were contentious, and the matter went to arbitration.

At its founding, Metro-North had about 9,500 employees, many of whom belonged to 17 di erent unions. According to Zullig, there were ongoing negotiations with Amtrak, Conrail and NJ Transit, as well as with the unions. e labor talks eventually broke down, and the United Transportation Union (UTU) started a strike on March 7 over crew sizes and assignments.

e strike lasted six weeks, and the crews went back to work on April 18, when the dispute went to arbitration.

Zullig remembered the strike, and how he worked temporarily as a trainmaster to help move Amtrak trains over the railroad. He told Railway Age that, while he always took legal les with him to review while he

was working in the tower, he didn’t always get that work done. On one occasion, he had to go out to a bridge and open it by hand for an Amtrak train. On another occasion, he had to work with power equipment, not exactly the subject matter for a course in law school. He noted that most of the freight ran during the day, so he seldom had to get a freight train through on his “night job.”

Zullig recalled that a lot of people at the MTA complained about Conrail, and that Metro-North turned out much better. He pointed to improvements that MetroNorth has made over the years: electri cation of the Upper Harlem Line to Southeast Station in Brewster in 1984, the overhaul that returned Grand Central Terminal to its historic grandeur, rehabilitating the Park Avenue Viaduct, and other features.

Although he is retired, Zullig is still active with the National Railway Historical Society (NRHS) and the Metro-North Commuter Council, an o cially constituted advisory committee. He concluded our interview by saying, “It’s good that MetroNorth was created. We did the job and we did it right. I’m very glad that I played a role in it. We have a blogging group of about 100 management retirees, and we’re all glad that we’ve been there.”

NJ Transit started as a bus company in 1979, when utility Public Service wanted out of the bus business. At that time, Conrail was running the trains in New Jersey that were once operated by the historic Pennsylvania, Lackawanna, Erie and Jersey Central

railroads. e Commuter Operating Agency (COA) within the New Jersey Department of Transportation provided oversight and nancial support. e bus side (including the Newark City Subway) and rail side were separate then.

e transition seemed smooth at rst, as 1982’s Conrail trains in New Jersey became 1983’s NJ Transit trains, under the auspices of the newly formed New Jersey Transit Rail Operations, Inc. (NJTROI). e Conrail practice of discontinuing lightly used lines continued during the early days of NJTROI, but the rest of the network kept running, with little change at rst. As on MetroNorth, it was not to last.

Labor relations were also contentious in New Jersey, and a strike began on March 1. e agency was demanding a $6,000 pay cut for conductors, but later relaxed that demand. Agency managers devised a strike contingency plan. Like Zullig at MetroNorth, some managers had an unusual work assignment during the strike, which lasted 42 days and ended on April 12. e trains came back, and NJT managers eventually built the state’s rail system into what it is today. e re-electri cation of the Morris & Essex (M&E) Line and its branches to Montclair and Gladstone, which began under Conrail, was completed. e fare structure was rationalized. MidtownDirect service on the M&E to New York Penn Station started in 1996. Secaucus Junction Station, which hosts trains from both the Newark and Hoboken Divisions, opened in 2003. While

April 2023 // Railway Age 53 railwayage.com passenger rail focus
SEPTA Silverliner V. Keith Barrow

some lightly served lines lost their trains in the early days and others later experienced cuts, there are also lines that have gained service over the years, like full service on the Montclair line, which was restored for the rst time in 34 years when the Montclair Connection opened in 2002. NJT brought the Atlantic City Rail Line back, as well, with trains to and from Philadelphia.

e transition on the Pennsylvania side of the Philadelphia area was much more di cult and contentious. It included a 108-day strike and a campaign to blur, and even obliterate, the line between local rail transit (like the Broad Street and MarketFrankford Lines) and the lines that had been part of Conrail, according to longtime manager omas R. Hickey.

At the time, Hickey was a transportation planner for Montgomery County, the county to the northwest of Philadelphia that includes Norristown. According to Hickey, then-SEPTA General Manager David Gunn called for deep cuts to save money and keep the electri ed service going. At the time, PennDOT eliminated diesel-hauled trains to such places as Reading, Bethlehem and New Jersey beyond West Trenton. e sole exception was the service to Newtown, beyond Fox Chase. It ran independently as the “Fox Chase High-Speed Line” with RDC

cars built by the Budd Company and owned by the City of Philadelphia until they were no longer serviceable. Hickey told Railway Age that Philadelphians colloquially refer to metropolitan transit lines as “high-speed” lines, like the “Norristown High-Speed Line” or the “PATCO High-Speed line” to South Jersey.

Hickey said that, when the time came for the transition away from Conrail, Gunn considered using the newly formed Amtrak Commuter Services subsidiary, but chose instead to create “regional highspeed lines” and remove many of the signs of “railroad culture” from those lines. Conductors no longer wore “railroad uniforms” and new uniforms looked like the ones bus drivers or streetcar operators wore. One engineer and one conductor were assigned to each train, but other crew members were dubbed “passenger attendants” and remained on standby for a call to work a train, instead of having a schedule.

A 108-day strike, the longest in the agency’s history, started in March. Members of 13 unions struck, and a key issue was SEPTA’s demand that train conductors accept pay cuts a er SEPTA had already cut the number of those workers by more than half. Eventually, a level of distinction

between the regional rail lines and local transit gradually came back, even though it took a few years, according to Hickey. ere were capital improvements, too, but they were not made by SEPTA. e City of Philadelphia made them within its borders, under the leadership of Ed Tennyson, PennDOT’s Deputy Secretary for regional transit during the 1970s. e rail side recovered some autonomy and crews regained their “railroad uniforms” later in the 1980s. By shortly a er 2000, the rail side had become semi-autonomous, if not fully independent.

ere was not much time to prepare for the transition from Conrail to the newly formed local railroads, nor was there much of a transition. Somehow, the new managers got the hang of their new jobs on the new railroads, as railroaders o en do. Today, all three railroads face challenges, including nancial ones.

Still, riders on most lines kept their trains. Service has improved over the years on some lines, declined on a few others, and stayed about the same on many. e situation could have been worse 40 years ago, but determined managers and rail labor got together on terms somehow, and the trains kept running.

ey still do.

54 Railway Age // April 2023 railwayage.com
Metro-North M8 William C. Vantuono



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elcome to “Timeout for Tech with Gary T. Fry, Ph.D., P.E.” Each month, we examine a technology topic about which professionals in the railway industry have asked to learn more. is month our subject is continuous welded rail (CWR).

A fundamental problem in railway engineering is joining lengths of rail to form the contiguous track that trains need to operate (Figure 1). Especially over the past 50 years, welding has become the preferred rail joining method for both passenger and freight railways in the U.S. and most other nations with railways. This is despite the challenges of welding steel rail. Rail steels comprise alloys that are considered difficult to weld and reliably obtain acceptable mechanical properties afterward: strength; ductility; fracture toughness; and fatigue resistance. Two welding processes stand out in their ability to reliably join rails: Thermite

WWelding and Flash Welding. We’ll start with thermite welding.

Thermite welding of railroad rail traces its history to Germany at the end of the 19th century. German chemist Johann Wilhelm Goldschmidt discovered a process to produce pure metals through the chemical reduction of metal oxides using pure aluminum—the aluminothermic reaction. This reaction is exothermic and can be designed to generate substantial heat energy. The most common aluminothermic reaction used in rail welding generates 3,350 KJ of heat and reaches a theoretical maximum temperature of 5,600 degrees F. By the early 1920s, its application as part of a welding process to join railroad rails was established. Figure 2 is a photograph of a thermite rail weld in progress.

To make a traditional thermite rail weld, the two rail ends that will be joined are set apart with a 1-inch gap that is then enclosed by a refractory split mold. After preheating the rail/mold system with an

oxy-fuel gas torch, a single-use refractory crucible containing the proper volumes of iron oxide, and aluminum particles (as well as steel filler material and other alloying and slag-forming materials) is placed over the open top of the molds. An ignition powder is used to provide the activation energy for the aluminothermic reaction. After a dwell time of 25 to 35 seconds in the crucible, molten steel fills the mold cavity and solidifies to join the rail ends.

With thermite welding, no external power source is required because the molten metal for the casting is produced by the aluminothermic reaction. A thermite rail weld can be completed by a team of two welding technicians in a little less than 45 minutes—even in remote territories. Because of its portability and ease of use, thermite welding is the most common method for completing repair welds on Class I railways in North America.

The second common process for rail welding is flash welding. Figure 3 is a

56 Railway Age // April 2023 railwayage.com
Figure 1. Joining lengths of rail is a fundamental problem in railway engineering. (Courtesy of Gary T. Fry.)

photograph of a flash rail weld being performed at a rail welding production facility. Flash welding comprises three primary steps: flash, upset, and hold. In flash rail welding, the ends of two rails are aligned close together end to end and gripped by special hydraulic clamps. The clamps serve three purposes: hold the rail ends in alignment; apply electric power to the rails; and move the rail ends relative to one another to control the flash, upset, and hold steps of the welding process.

e ash step involves establishing an electric arc between the ends of the rails, which heats them to melting and expels metallurgical impurities from the joint.

e upset step involves pressing the molten ends together under a controlled force, roughly 100,000 pounds, which results in a predictable amount of permanent deformation (or plastic upset) within the joint. During the hold step, a compressive force is maintained across the joint, but no further plastic upset occurs. e joint is held under force until it has cooled enough to ensure an acceptable weld has been made. Electric current of varying magnitude can be applied through the now-joined rail to control the cooling rate of the joint, thereby ensuring development

of acceptable metallurgical and mechanical properties of the completed weld.

It takes roughly three minutes to complete a flash rail weld. Flash rail welding can be performed in a plant setting as seen in Figure 3, or in the field using equipment mounted on rail vehi-

just compare Figures 2 and 3. In fact, however, these two welding processes share as an end goal the essential principle that all welding processes have in common. That is, in its most basic form, welding is simply a process to establish metallic bonds and favorable metallurgy between two separate pieces made from the same (or very similar) alloys.

Our welding application involves two pieces of rail steel. Rail steels comprise more than 97% iron by weight. So, welding rail pieces together means establishing bonds between iron atoms. From a theoretical point of view, this isn’t di cult to accomplish. In a vacuum, separate pieces of very pure iron readily bond at points where they touch. is is a fundamental characteristic of metallic bonds, and it’s what makes metals good conductors of electricity.

cles. There are numerous variations of flash rail welding process parameters and means of controlling them in real time during welding using digital sensing and digital feedback algorithms.

At first glance, these two welding processes seem unrelated to one another;

However, it is very difficult to bond enough iron atoms between separate pieces of rail to make a mechanically acceptable joint. There are two main reasons for this: metal oxidation and atomic proximity. In Earth’s atmosphere, freshly exposed surfaces of steel form iron oxide instantaneously. These surface oxide layers pose a substantial barrier to forming metallic bonds between the pieces

April 2023 // Railway Age 57 railwayage.com TIMEOUT FOR TECH
Figure 3. Photograph of a flash rail weld in progress. (Courtesy of Gary T. Fry.)
It is very difficult to bond enough iron atoms between separate pieces of rail to make a mechanically acceptable joint.
Figure 2. Photograph of a thermite rail weld in progress. (Courtesy of Gary T. Fry.)

of rail. e other reason for the di culty is the proximity of iron atoms between the two rail surfaces. In every practical sense, it is impossible to create parallel and atomically at surfaces on two di erent rail ends so that surface iron atoms are in immediate and intimate contact when the rail ends touch together. Both issues can be overcome with two strategies.

1. Introduce enough heat energy to melt the iron oxides at the joint between the two pieces, i.e., generating a temperature greater than 2,900°F; and

2. Bring pure iron atoms into close enough proximity to bond at the joint.

Let’s compare thermite welding and flash welding against these strategies. First consider the issue of iron oxide barriers. Thermite welding introduces a liquid steel alloy that has a temperature exceeding 4,000°F—plenty hot enough to melt the iron oxides and expose and energize fresh iron atoms. Flash welding introduces an electric arc that has a temperature exceeding 10,000°F—also plenty hot enough to melt the iron oxides and expose and energize fresh iron atoms. In thermite welding, the melted oxides (and other metallurgical impurities) are dissolved in the liquid and ultimately float to the surface of the casting above the head of the rail and are removed during final dressing of the rail joint. In flash welding, the oxides (and other

metallurgical impurities) are expelled from the joint during the flashing step— for example, note the sparks in Figure 3.

Now consider the issue of iron atom proximity. In thermite welding, liquid steel flows into the molds filling the volume of the cavity and coating all interior surfaces. Obviously, this satisfies the requirement for atom proximity at the rail ends. In flash welding, the freshly exposed molten rail ends are pressed together under a substantial force that causes plastic upset of the material in the joint. This is a different but equally effective means of ensuring acceptable proximity of iron atoms for bonding.

Regardless of the process used (thermite welding or flash welding), the completed rail joint must be dressed using grinders to ensure a proper running surface and gage surface for train wheels. Figure 4 is a photograph of a completed and dressed thermite rail weld.

In summary, welded rail provides a continuous and smooth rail head that allows wheels to cross rail joints without impacts. Impact-free rail joints minimize the stresses imposed on the rails and wheels, which helps ensure the long-term safety, reliability, and efficiency of overall rail operations.

Dr. Fry is the Vice President of Fry Technical Services, Inc. (https://www. frytechservices.com/). He has 30 years

of experience in research and consulting on the fatigue and fracture behavior of structural metals and weldments. His research results have been incorporated into international codes of practice used in the design of structural components and systems, including structural welds, railway and highway bridges, and high-rise commercial buildings in seismic risk zones. He has extensive experience performing in situ testing of railway bridges under live loading of trains, including high-speed passenger trains and heavy-axle-load freight trains. His research, publications, and consulting have advanced the state of the art in structural health monitoring and structural impairment detection.

58 Railway Age // April 2023 railwayage.com TIMEOUT FOR TECH
Figure 4. Photograph of a completed and dressed thermite rail weld. (Courtesy of Gary T. Fry.)


The United States currently has 92 nuclear power reactors at 53 power plants in operation providing 19% of the nation’s power supply. Nuclear power generation has the bene t of not directly producing carbon emissions like coal and natural gas, but it does produce nuclear waste byproducts that must be safely transported, stored and eventually disposed of. is article describes the U.S. Department of Energy (DOE) Fortis spent nuclear fuel cask-carrying railcar project that is being performed by ENSCO via

DOE Contract 89243222CNE000026.


Spent nuclear fuel (SNF) is radioactive material, such as uranium, that has been used in a nuclear reactor to generate electricity. At the end of its service life, it is no longer useful in sustaining a nuclear reaction so it must be safely stored until it can be permanently disposed of. Currently, most SNF is safely stored in specially designed spent fuel pools or dry storage casks at individual reactor sites around the country.

e DOE is responsible for the longterm disposition of SNF and high-level radioactive waste (HLW), including their associated transportation. DOE is currently pursuing federal consolidated interim storage for SNF that will reduce the number of sites SNF is stored at in the U.S., allow decommissioned nuclear power plants to be put to new industrial uses, and begin ful lling the federal government’s responsibilities for disposition of SNF until a disposal solution is available. To contain the radioactive material for transportation, DOE uses Type

April 2023 // Railway Age 59 railwayage.com
A new railcar for transporting spent nuclear fuel and highlevel radioactive waste.
TTC Operated by ENSCO
Department of Energy prototype Fortis eight-axle cask-carrying railcar design.


B transportation casks, which are large, reinforced containers. ese casks have been speci cally designed to prevent the possibility of radioactive release, even in the event of a collision, and are certi ed in accordance with 10 CFR Part 71, issued by the Nuclear Regulatory Commission (NRC). Casks can weigh up to 240 tons when loaded, including the shipping cask, cradle, impact limiters and end stops. Because of the size and weight of the casks, transporting by rail is the safest and most economical transportation method.


Currently, there are three cask-carrying railcars designed for transporting SNF in North America. e rst two are a twelveaxle railcar developed by the U.S. Navy, and a twelve-axle railcar, named Atlas, developed by DOE. e third, and the focus of this article, is an eight-axle railcar, named Fortis, also developed by DOE.

e Fortis railcar has been designed by DOE Contractor Sharma and Associates to comply with the Association of American Railroads (AAR) Performance Speci cation for Trains Used to Carry High-Level Radioactive Material (HLRM) – Standard S-2043, which is a part of the Manual of Standards and Recommended Practices – Car Construction Fundamentals and Details. is standard establishes performance guidelines for trains carrying SNF and HLW on AAR railroads (HLRM is an AAR-speci c term and is understood to mean SNF and HLW). S-2043 speci es three railcar development phases, which include preliminary design and analysis, prototype testing, and nal design and analysis.

e Fortis railcar has nished the rst phase—preliminary design and analysis. e AAR Equipment Engineering Committee (EEC) approved the initial design, and the prototype Fortis railcar was allowed to proceed to fabrication and testing. ENSCO partnered with Kasgro Rail Corp. (Kasgro) for fabrication of the railcar, Oak Ridge Technologies (ORT) for cask-mounting hardware, and RailcarCO Corp. for project support. A er fabrication is complete, the railcar will be transported to the Federal Railroad Administration Transportation Technology Center (TTC) in Pueblo, Colo., for extensive testing according to S-2043.


S-2043 includes static and dynamic vehicle tests from the AAR Manual of Standards and Recommended Practices, Section C, Part II, Chapter XI standard. Chapter XI is famously the gold standard for defining freight railcar qualification testing to enable a new railcar design to operate through interchange on AAR railroads. S-2043 tightens the performance requirements for many Chapter XI tests and includes additional requirements to help put a greater focus on derailment risk reduction.

S-2043 testing includes single-car tests and multiple-car tests. The single-car tests are designed to evaluate and characterize the prototype vehicle as well as its components. This includes, but is not limited to, truck suspension characterization, structural tests, vehicle dynamic performance tests and brake tests. Multiple-car tests are designed to verify that the individual railcars in the consist do not adversely affect the performance of the train consist. These tests include train consist braking tests, buff and draft curving, as well as system monitoring tests and ride quality. All single-car and multiple-car tests and subsequent data analysis will be witnessed by a qualified AAR observer.


A er arrival of the Fortis railcar at the TTC, ENSCO’s experienced instrumentation and engineering team will instrument the railcar according to previously developed and approved Test Implementation Plans (TIP). e instrumentation includes Instrumented Wheelsets (IWS), which measure the wheel/rail contact forces and ensure that the vehicle does not exceed derailment risk criteria. Additionally, strain gauges will be installed to measure stresses in the railcar structure. Accelerometers and displacement transducers will be installed to measure vehicle dynamics performance.

e TTC is equipped with all the necessary facilities and test tracks required for AAR S-2043 and Chapter XI testing and certi cation. TTC’s Wheel Rail Mechanism Loop (WRM) is a 7.5-mile loop with 4-, 5-, 7.5-, 10- and 12-degree curves where the Chapter XI Dynamic Curving testing

is conducted. Dynamic Curving is arguably one of the most challenging vehicle dynamics tests of the standard because it is designed to fully exercise the railcar’s suspension to identify potential derailment risk. e Precision Test Track (PTT) has intentional track perturbations necessary for S-2043 and Chapter XI vehicle dynamics testing for pitch and bounce, twist and roll, and yaw and sway.

In addition to the on-track testing capabilities, the TTC has the Rail Dynamics Laboratory (RDL) with full-scale lab testing equipment to evaluate rail vehicles in a laboratory setting. Testing of the Fortis prototype railcar will utilize TTC’s MiniShaker Unit (MSU), which is equipped with 13 hydraulic actuators that can apply a maximum of 210 kips to the railcar in a dynamic manner and at di erent frequencies to assess truck vertical, lateral, roll and yaw performance, truck yaw resistance, and railcar component testing. e Squeeze Test Fixture (STF) will be used for the compression testing along the dra line and is capable of up to 2,600 kips of a compressive load to the whole vehicle for crush compliance testing and structural stress testing.


e TTC operated by ENSCO and its partners are aiding the DOE to fabricate and test an eight-axle spent nuclear fuel caskcarrying railcar. is project is the rst of many where the TTC under ENSCO’s operation provides AAR quali cation testing for future freight rolling stock.

Questions about the O ce of Nuclear Energy’s programs, including railcar development projects, may be directed to NEcommunications@nuclear.energy.gov.

60 Railway Age // April


HIGH PROFILE: Former MTA Long Island Rail Road President Phillip Eng is heading to Boston. On April 10, he will become General Manager of Massachusetts Bay Transportation Authority (MBTA). Eng succeeds interim General Manager Je Gonneville, who will remain with MBTA and assist with the transition to new management. Gonneville served previously as Deputy General Manager under Steve Po ak, who stepped down as MBTA leader on Jan. 3, 2023, following the Federal Transit Administration’s call for safety improvements at the transit authority.

Eng retired as President of LIRR in February 2022, handing the throttle to Catherine Rinaldi, who is heading up the commuter railroad in an interim capacity while continuing as MTA Metro-North Railroad President. Eng joined New York MTA in 2017 following service at the New York State Department of Transportation, where he worked his way through the ranks beginning in the 1980s and ultimately served as Executive Deputy Commissioner and Chief Engineer from 2013-17. At MTA, he was Chief Operating O cer, responsible for leading the procurement and award of a $540 million contract to modernize the agency’s mobile ticking system and improving its contracting methods to better ensure projects would be completed on time. He then held the position of acting President for MTA New York City Transit, before being appointed LIRR President in 2018. At LIRR, he managed a system of 7,600 employees and a $1.6 billion operating budget. Eng also oversaw the implementation of new technology that improved the accuracy of train arrival time estimates on platforms and led to the release of the new LIRR TrainTime app, as well as the launch of “Customer Conversation” forums and “Meet the Manager” station settings.

Since June 2022, Eng has served as Executive Vice President of the LiRo Group, where he advises public- and private-sector clients on engineering, transportation and infrastructure projects. He has worked with a number of public transportation clients across the Northeast, including MBTA, on construction management and quality design, assurance and control inspections.


Norfolk Southern

HIGH PROFILE: Norfolk Southern last month namedStefan Loeb to Vice President First and Final Mile Markets, a role that “prioritizes innovation around rst- and nal-mile products and processes key to short and long-term development.” Loeb was most recently Executive Vice President and Chief Commercial O cer at Watco. He joined the company in 2010, and held such roles as Vice President of Business Development, Senior Vice President of Marketing and Strategic Development, Executive Vice President and Chief Marketing O cer, and Executive Vice President-Network Strategies. Prior to that, he spent nine years in the banking industry. Loeb has also served as Chairman of the American Short Line and Regional Railroad Association (succeeded by Genesee & Wyoming’s Matt Walsh), Chairman of the Short Line Safety Institute, and a member of the STB Railroad-Shipper Transportation Advisory Council (RSTAC).

The American Short Line and Regional Railroad Association (ASLRRA) has named Matt Walsh, Genesee & Wyoming Executive Vice President, Global Corporate Development, as Chairman of the Board, succeeding Stefan Loeb. Walsh served most recently as ASLRRA Board Vice Chair. He has been with Genesee & Wyoming since 2001. Previously, Walsh was an investment banker at Salomon Smith Barney, Inc., and Schroder and Co., Inc., in New York and London.

Andy Byford, nicknamed “Train Daddy” when he was President of MTA New York City Transit, will begin a new role as Senior Vice President for Amtrak’s high-speed rail (HSR) program, effective April 10. His hiring was announced in an internal Amtrak memo stating that he will be based in Washington, D.C., and will “ensure operational strategy alignment between new HSR programs and our current network. Andy is widely respected in the industry and has a wealth of experience leading large transportation systems worldwide.” Byford’s new position comes six months after he announced that he would be resigning as Commissioner of Transport for London (TfL) and would be returning to the U.S. A U.K. native, Byford previously ran transit systems in Toronto and New South Wales, Australia. He joined the MTA in 2018, where he quickly gained popularity as NYCT’s subway service improved, marked by better on-time subway performance and approval of $40 billion in proposed spending to modernize New York City’s subways and buses. But Byford publicly feuded with disgraced former New York Gov. Andrew Cuomo, who in 2019 passed legislation that forced a restructuring of the MTA that ultimately stripped Byford of his oversight of transit construction projects. In 2020, Byford resigned as NYCT President, saying he had had enough of interference from the nowresigned governor, with whom he sparred over the cancellation of NYCT’s longplanned L Train shutdown. He stated in his letter of resignation that “there were others at the agency who could perform this important, but reduced, service delivery role.” Byford then joined TfL and served as Commissioner for 30 months before resigning last September.

April 2023 // Railway Age 61 railwayage.com PEOPLE
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Safety: How You Function When No One is Watching

It has been a tumultuous two months of railroad reporting, commentary, and legislative and regulatory proposals since the derailment in East Palestine, Ohio— some factual, some speculative, some helpful, some grandstanding. e incredible amount of coverage and the notable increase in attention on railroad practices is a reminder of the “social license” that railroads need to operate, and that license depends not only on actual safety but also on community relations and perception.

For the community of East Palestine or any other community impacted by a railroad accident, there is not much comfort to be found in broader railroad industry safety data, and for the public at large there is a disinclination to trust the railroad messenger. But neutral commentators agree on the data, and it should not be discounted. e Associated Press recently reported: “ e railroad industry is generally regarded as the safest option for most goods, and federal data show accidents involving hazardous material are exceedingly rare.” USA Today noted: “Not only was [the Norfolk Southern] incident relatively rare, so are deaths from incidents involving hazmat cargo railcars.

e last reported death from hazardous material on a train was in 2011.” is data is easy to nd—a quick search on the Bureau of Transportation Statistics, Federal Railroad Administration (FRA), and Pipeline and Hazardous Materials Safety Administration (PHMSA) websites brings the indisputable facts right up.

I am pleased to say that short line industry data is in line with these facts. Over the most recent four years (2019-22), short line railroads have run an average of approximately 122 million train miles per year. Over that fouryear period, derailments have declined from 298 to 254, derailments involving hazmat cars have declined from 64 to 43, and derailments involving hazmat release total only four in the four years. In that same four-year period, short lines have had only 16 derailments involving over-heated bearings. Since the typical short line moves at a slow rate of speed, these types of accidents are exceedingly rare, and when they happen, they are not very dramatic.

ese facts notwithstanding, zero accidents and injuries is the goal, and we should be doing everything we can to reach that goal. e short line industry is making that e ort. In 2015, in conjunction with the FRA, we established the

Short Line Safety Institute (SLSI). e SLSI is a non-pro t corporation dedicated to supporting short line and regional railroad safety performance with a focus on safety culture, de ned as the shared values, actions, and behaviors that demonstrate a commitment to safety over competing goals and demands. In short— how you function when no one is watching. To that end, the SLSI provides Safety Culture Assessments, de ned by the FRA as the “most robust model for assessing safety culture in the U.S. railroad industry.” e evaluation is structured to identify shortcomings in a railroad’s safety culture and work with managers and employees in a con dential, non-punitive atmosphere to acknowledge and address those areas of opportunity. Over the past seven years, the SLSI has completed more than 125 Safety Culture Assessments, and we believe it has played an important role in improving the way short lines think about and practice railroad safety. is program is o ered at no cost to railroads and I’d encourage all short lines, passenger, commuter, historic and tourist railroads to consider utilizing this key resource.

With 600-plus years of sta experience in hazmat transportation safety, the SLSI also serves as a robust training resource for short lines transporting hazardous materials, also delivered at no cost thanks to grant funding. Using a PHMSA grant, the SLSI just completed its rst Assistance for Local Emergency Response Training (ALERT) program at the New Orleans & Gulf Coast Railway. Local emergency responders, including the local re and police departments, and railroad employees participated in instruction, hands-on training and interactive experienced-based discussion tailored to meet rst responders’ needs.

For many years, the short line industry has emphasized the critical need to invest in railroad rehabilitation, because improving track conditions is the best way to reduce derailments. We have delivered on that need by consistently investing up to 25% or more of annual revenues back into infrastructure improvements. e federal government has been an important partner in this regard, rst through enacting the 45G Short Line Rehabilitation Tax Credit, and more recently through the funding of signi cant infrastructure spending programs. e CRISI program

has been particularly important to short lines because they are directly eligible applicants. Improving infrastructure is directly related to improving operational safety (track problems are by far the most common cause of short line derailments), and we encourage Congress to fully fund these programs.

In this moment, legislators and other stakeholders are awash with proposals to respond to East Palestine. Some of these miss the mark, some are spot-on, and there are some short lines can support if the details are realistic. Responsive, relevant and reasonable proposals include increasing the number of inspectors and track geometry cars, phasing out older tank cars, improving procedures for training and qualifying individuals responsible for maintaining and responding to hot box detectors, and expanding the de nition of high-hazard ammable trains to include Class II ammable liquids, to name a few. Although not legal or regulatory changes, we think increased participation in initiatives like RailPulse, AskRail and FRA’s Close Call Reporting System would yield bene ts too. Other recommendations will surface in the coming weeks and months and the short line industry is committed to being a constructive participant in whatever dialogue takes place.

Of course, there are proposals that bear no relationship to incidents—like mandating crew size, which increases cost with no impact on safety. And ECP brakes, which has already been studied and discarded. And proactive noti cation of every single hazmat shipment, which would be obviously counterproductive. And there is a proposal to ban LNG by rail, which simply shi s the tra c from rail to truck where accident rates are far higher and where highway congestion is already a signi cant problem. e public interest is best served if those empowered to make legal and regulatory changes stick to the changes that can make a positive di erence.

64 Railway Age // April 2023 ASLRRA Perspective


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