As the Q4 earnings announcement period continues to ramp-up, there is rather positive news coming from the U.S. railroad sector, news that bodes well for an uptick in North American supply chain activity. The Wall Street Journal noted that the largest North American railroads hauled more of most everything in the fourth quarter, generating more optimism, hiring and previously idled equipment resource deployment.
CSX Corp. and Union Pacific indicated that business is so good that they are rehiring more previous idled workers. Union Pacific recorded a 31 percent increase in operating income and noted that 2010 was the most profitable year in the company’s 150 year history. Business volumes were up 9 percent with all 6 business groups reporting shipment volume growth. CSX recoded a 46 percent increase in Q4 profit and noted growth across nearly all markets. The railroad plans to invest $2 billion in its business operations in 2011.
Norfolk Southern recoded a 14 percent increase in revues and a 31 percent increase in year-on-year profits. Coalrevenues increased 18 percent, intermodal was up 16 percent and general merchandise was up 10 percent.
Canadian National Railway reported a 19 percent increase in Q4 profits with strong growth noted in all freight segments. For 2011, CN predicts continued increased freight activity in overseas container, metal products and iron ore, along with export demand in lumber, petroleum and chemicals. Canadian Pacific Railway reported a 34% increase in Q4 operating income and also noted strong demand across all lines of business. CP has allocated up to $1 billion for capital improvement programs in 2011.
Good news indeed and hopefully, 2011 will bring more momentum for North American supply chains.