Rail Volume Roars Back
Rail volume is rebounding in 2010.
Demand for railroad service is rebounding from its astounding 2009 plummet at a record clip. The Association of American Railroads this week reported that May's 15.8% year-over-year monthly carload growth was the second-greatest monthly gain in United States demand since the AAR began tracking volume in 1990, and the all-time greatest monthly carload increase was in April--just the prior month.
Intermodal units originated during May 2010 improved 18.9%--the largest year-over-year monthly gain in trailer and container volume on record. Carload and intermodal volume both display some seasonality. As was the case in 2007, 2008, and 2009, there were fewer carloads hauled in May than in April. Intermodal volume normally displays a downward tick after June and October (but none following April). The AAR's May 2010 values exclude a late Memorial Day, which makes for a slightly favorable comparison to May in 2008 and 2009, when this non-workday fell in May. Examining the first 20 weeks of 2010 (just a week less) gives us the latest data without holiday complications.
Keith Schoonmaker does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.