Carload volume deficit narrows as retail sales climb

A photograph of intermodal containers and chassis parked in a rail yard.

U.S. carload traffic narrowed its year-over-year deficit last week, with carloads down only 3.1% compared with the same period in 2019, according to the Association of American Railroads.

U.S. carload volumes totaled 232,146 for the week ending Saturday, a 3.1% decline from the same period in 2019 but a 1.7% increase sequentially.

U.S. intermodal traffic was also higher year-over-year, up 12.9% to 295,316 intermodal containers and trailers. On a sequential basis, intermodal volumes were up 0.5%.

Combined, U.S. rail volumes were up 5.2% on a weekly basis to 527,462 carloads and intermodal units. But year-to-date volumes were down 8.8% to 21.7 million carloads and intermodal units.

U.S. rail carloads (blue: RTOTC.USA), intermodal trailers (orange: RTOIT.CLASSI) and containers (green: RTOIC.CLASSI) over the past year. (FreightWaves SONAR)

The year-over-year gains for intermodal come as the National Retail Federation (NRF) said Tuesday that U.S. retail sales grew for the sixth month in a row in October amid early holiday shopping.

NRF calculated that retail sales rose 10.6% in October on an unadjusted basis compared with October 2019. In contrast, the U.S. Census Bureau also reported on Tuesday that overall retail sales were up 0.3%. The difference between the two figures is that NRF excludes sales from automotive dealers, gasoline stations and restaurants.

“October retail sales remained on track despite the pandemic continuing to affect households and businesses,” NRF Chief Economist Jack Kleinhenz said. “The steady expansion of retail sales is good news against the background of these unusual economic circumstances and climbing virus cases in recent weeks. Early holiday shopping appears to have supported October’s increase in sales.”

Kleinhenz continued, “The rise in COVID-19 cases continues to be a factor that weighs on consumer perceptions, sentiment and spending and there could be retrenchment if we cannot thwart this latest wave. Nonetheless, retailers are well prepared to safely fulfill holiday shopping lists, and the October results suggest so far, so good.”

Union Pacific, OmniTRAX announce leadership changes

Union Pacific (NYSE: UNP) has named Humberto Vargas as vice president of Mexico, marketing and sales for Union Pacific (UP). Vargas will assume the position Dec. 1, succeeding Bernardo Ayala, who is moving to a leadership position in locomotive distribution and network operations.

According to UP, Vargas will lead Union Pacific’s international business strategy in all commodity areas traveling across all six rail gateways to Mexico, and he will be responsible for working with customers, other railroads, suppliers and multiple governmental agencies.

He will be based in Mexico City and will report to Kenny Rocker, who is UP’s executive vice president for marketing and sales. 

“Humberto brings a wealth of experience and expertise in multimodal freight transportation needed to support seamless cross-border freight rail shipping that results in safe, reliable and efficient rail service,” Rocker said. “Our team is looking forward to his leadership that will help maximize the strength of Union Pacific’s network to help current customers grow and bring new customers onto our rail lines.”

Vargas was recently with Werner Mexico, where he spent eight years leading commercial relations with customers, Mexican transportation carriers and intermodal service, UP said. He also served as assistant vice president of intermodal sales and marketing for Ferromex, Mexico’s largest railway, where he worked for seven years. Prior to joining Ferromex, Vargas worked for Intermodal Mexico/Texas Pacifico Transportation.

Vargas is the president of the Mexican Association of Intermodal Transportation, an organization representing intermodal industry leaders that focuses on promoting and facilitating intermodal business in Mexico, UP said. He holds a bachelor’s degree in chemical engineering from Universidad Iberoamericana in Mexico City.

Meanwhile, short line operator OmniTRAX said Monday that CEO Kevin Shuba will move to OmniTRAX’s parent company, The Broe Group, where he will lead the development of a companywide portfolio growth plan for The Broe Group.

OmniTRAX President Sergio Sabatini will serve as interim CEO as OmniTRAX Board Chair Cameron Scott leads the search for a new CEO. Sabatini joined OmniTRAX in 2013 from Canadian Pacific.

“Kevin Shuba has been instrumental in the sustained growth of OmniTRAX,” said Scott. “OmniTRAX’s success can be traced to a culture of industry-leading service, an unrelenting commitment to customers and unparalleled community engagement cultivated by Kevin and the OmniTRAX team. We are committed to appointing a new CEO that embodies these core OmniTRAX principles to provide the continuity and leadership for the next chapter of company growth.”  

CN, Canadian Pacific, CN receive sustainability accolade

CN (NYSE: CNI), Canadian Pacific (NYSE: CP) and CSX (NASDAQ: CSX) have secured a spot on the Dow Jones Sustainability Index (DJSI) North America

The annual index, comprised of a partnership between the Dow Jones Indices and RobecoSAM Sustainability Assessments, assesses companies’ performance using economic, environmental and social criteria.

The index worldwide lists 102 companies. Sustainability leaders from various industries assess companies’ responses to issues such as corporate governance, risk management, climate change mitigation, supply chain management, stakeholder engagement and labor practices.

“At CN, our people have been committed to sustainable business practices for many years. We call it ‘delivering responsibly,’ and in 2017, we became the first Class I freight railroad in the world to set a science-based climate target,” said CN President and CEO JJ Ruest. “The company believes rail has tremendous potential to reduce the environmental impact of transportation and we are committed to playing a key role in the transition to a low-carbon economy. As we continue our journey towards sustainable business growth, we are committed to achieving our ESG [environmental, social and corporate governance] goals, which support the company’s strategic ESG priorities.”

Said CP President and CEO Keith Creel, “CP is always working to develop innovative, impactful ways to enhance the communities we serve and protect the environment. We have been a part of the North American landscape since 1881, and our commitment to people, the planet, safety and ethics is unwavering. I am proud that the DJSI has recognized the hard work and commitment of the entire CP family.”

CSX said it was the only U.S. railroad to make the index, and it was ranked among the top 15 transportation and transportation infrastructure companies worldwide. 

“Being ranked among the most sustainably run transportation companies in the world is an affirmation of the actions we’re taking to reduce fuel consumption and lower emissions through technology and increasingly efficient operations,” said CSX President and CEO Jim Foote. “Our commitment to sustainability is good for us, for our customers and for society. It supports our strategy of working with customers to convert more freight from highway to rail, which reduces highway congestion and wasteful emissions.”

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