U.S. freight railroads are projected to spend an estimated $22 billion to maintain and upgrade the nation’s private rail network in 2017, according to the rail industry’s trade group, the Association of American Railroads (AAR).
“This year's private network spending—a combination of capital expenditures and maintenance—is part of a continued trend of remarkable proportions, including more than $630 billion since the industry was partially deregulated,” says Edward Hamberger, president and CEO of the AAR. “Our role in moving the country’s freight is critical and we look to be a productive part of a bipartisan infrastructure debate.”
The projected $22 billion in private spending in 2017—or approximately $60 million a day—covers upgraded track and locomotives, as well as technological advancements needed to meet demand and ensure safety. Recent statistics show freight railroads created nearly $274 billion in economic activity, generated nearly $33 billion in state and federal tax revenues and supported nearly 1.5 million jobs nationally in 2014, according to the AAR.
The projections are comparatively less than 2016 spending as the industry continues to retool around a changing customer market and shifting traffic patterns—most notably the massive decline of coal production.