Slumping Freight Volumes Help Drive Down Rail Profits

SUGAR LAND--August 9, 2016--Researched by Industrial Info Resources (Sugar Land, Texas)--Almost across the board, North American rail operators reported declining freight volumes and lower quarterly profits in second-quarter 2016 when compared with the same period last year. Rail operators including CSX Corporation (NYSE:CSX) (Jacksonville, Florida), Union Pacific Corporation (NYSE:UNP) (Omaha, Nebraska) and Norfolk Southern Corporation (NYSE:NSC) (Norfolk, Virginia) reported profits that were lower than the previous year and declining freight volumes, particularly for coal. One notable exception, Kansas City Southern (NYSE:KSU) (Kansas City, Missouri) did show higher profits and a less significant decline in coal shipments than other major operators.

Despite the dwindling profits of most of the major rail players, capital and maintenance spending remains quite strong in the freight rail sector.