Rail Volumes Up, Union Pacific Improving

With volumes of carloadings and intermodal traffic increasing, overall network speed across North American railroads fell 1.7% in Week 13 (through April 1). Year-to-date, train speed dropped 4.9%. Terminal dwell times improved for the week (down 3.5%), but year to date, dwell times deteriorated by 2.7%.

The Association of American Railroads reported U.S. railroads originated 1,729,924 carloads of freight in March, a 2.5% increase over March 2004. Meanwhile, intermodal traffic reached 1,056,685 units during the month, up 3% for the prior-year period.

Year-to-date figures for carloadings were up 2.5% and intermodal rose 7.6%.

“Traffic gains in March reflect an economy that is expanding at a healthy pace,” said the AAR release.

Union Pacific (UP) reported average train speed of 22.1 miles per hour in Week 13, a 4% improvement and the fifth consecutive week of improvement, according to equity research firm Morgan Stanley. This is the best weekly velocity the railroad has reported since September 2004.

Improved velocity is helping to reduce terminal dwell times on the UP, down 13% year on year.

“The recent improvement in operating metrics support our belief the worst of [the UP’s] operational struggles are behind it,” said Morgan Stanley.

On the other coast, CSX has seen train speed fall 6.5% and terminal dwell time increase 6.2%.

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