Commentary

Oberman: STB Remains Actively Involved in Rail Reg Mods

We hosted a June 15 call with Marty Oberman, Chairman of the Surface Transportation Board, on Thursday. We see a reciprocal switching ruling well before year-end, and a bottleneck ruling potentially in 2024. Rail service continues to be at the forefront of the STB’s agenda. The CPKC merger has increased competition through new north-south lanes, though further Class I consolidation is increasingly unlikely.

Commentary

‘Railroad Happy Hour’ Report: Volumes Falling Short, Service Improving

At TD Cowen’s latest “Railroad Happy Hour,” leaders in the rail and logistics market said they continue to face a soft volume environment, though service improvements are a step in the right

“The start of 2023 was busy at Trinity as we continued to ramp up production and optimize our business,” Trinity President and CEO Jean Savage said.

Trinity’s Savage: ‘Busy’ Start to 2023 (TD Cowen Update, May 4)

While lease rates and utilization improved in first-quarter 2023 for Trinity Industries’ Railcar Leasing and Management Services Group, margins in the Rail Products Group “continue to reflect headwinds,” according to President and CEO Jean Savage, who said during a May 2 financial report that company officials are “optimistic about what Trinity can accomplish in 2023.” TD Cowen weighs in on May 4.

CSX 1Q23: ‘An Encouraging Start to the Year’

“CSX had an encouraging start to the year as the efforts of our dedicated railroaders resulted in strong earnings growth,” said President and CEO Joe Hinrichs during the Class I’s financial report on April 20.

Commentary

TD Cowen: NEARS Conference Key Takeaways

We attended the NEARS (Northeast Association of Rail Shippers) Conference, where shippers discussed the current state of the rail industry. Rail service and safety was center stage, with panelist consensus embracing a challenged rail network to start 2023. In our view, decelerating rail volumes and excess capacity over the road may lead the rails to revise outlook during Q123 earnings.

TD Cowen: 1Q23 Surveys Say …

The results of our 1Q23 Rail and Equipment Surveys indicate a slight decrease in business growth expectations, and some resilience in railcar demand.

Greenbrier’s new orders—comprising tank cars, autoracks, boxcars and covered hoppers—“were consistent with Greenbrier’s expectations for the period,” the manufacturer said March 22.

Greenbrier Lands $580MM in New Railcar Orders

The Greenbrier Companies on March 22 reported receiving orders for 4,500 new railcars during the fiscal second quarter ended Feb. 28, 2023, for which it provided preliminary results, including deliveries of 7,200 units. TD Cowen offers insight.