Four Reasons to Cheer, Three Reasons to Fear

Railroad Weekly Feb. 20, 2023

Inside This Issue  

·   The Outlook for Growth: Four Reasons to Cheer, Three Reasons to Fear

·   Pressure Builds: NS Faces Growing Anger Over Ohio Derailment      

·   Stock Shock: Equity Investors See No Gains from Trains

·   Four-Wheel Thrive: Auto Demand Still Going Strong

·   Whines from the Mines: Coal Firms Still Peeved About Poor Rail Service

·   Livin’ La Vida Loco: Wabtec Turns Bullish

·   Porty’s Over: L.A. Imports Plunge, Will Things Ever Be the Same Again?

Track Talk

“In North America, I think despite carloads being down, we continue to see interest and demand on both modernizations and new locomotives.”

-Wabtec CEO Rafael Santana

The Latest

·   If growth is what North American railroads are seeking in 2023, then so far, so good… sort of. Carload traffic across the industry is up about 4% y/y through Feb. 11^th, according to AAR data. And for that thank 1) ongoing gains for coal, 2) extremely strong growth for Canadian grain and other ag products, 3) a significant recovery in auto production across North America, and 4) positive trends for moving metals, ores, and minerals often for construction.

·   But hang on. There are three bad news stories as well. One is a decline in chemicals