Output of High-Value Cargo, Growing Trade to Advance US Rail Freight Revenues

Cleveland OH, November 8, 2024 — US freight by rail revenues are forecast to see annual increases of 1.9% in nominal terms through 2028, according to Freight by Rail: United States, a report recently released by Freedonia Focus Reports. The volume of railroad freight is projected to see average annual growth of less than 1.0% to 2028. Continuing expansion in manufacturers’ shipments and growth in US trade activity will drive demand for rail freight transportation. In addition, output of chemicals and allied products – one of the most profitable railroad cargos and a leading product shipped by rail – is projected to rise in real terms to 2028, as is production of motor vehicles in volume terms, another high-profit cargo item. However, faster gains will be prevented by falling volumes of coal handled.

Key factors affecting the freight by rail industry include fuel costs, age of rail infrastructure, technological advances in equipment for rail and alternative transport modes, and competition from operators of freight by truck and waterway. The challenges posed by fuel costs are often met with advances in technology. One such example is Wabtec’s Trip Optimizer, which is an automated system designed to factor in train size and weight, routes, weather conditions, and other factors to design an optimal fuel-efficiency plans. Other technologies and strategies employed to increase train fuel efficiency include anti-idling or "start-stop" systems and distributing power (placing multiple engines in the front, middle, and/or rear of the train).

While rail freight operators compete with other modes for shipping business, shippers are increasingly utilizing intermodal transport to benefit from the distinct advantages offered by trucking, rail, and water transport, so demand is not limited to one freight mode.

Crude oil output and prices affect the freight by rail industry in a number of ways. Over the forecast period, expected increases in domestic crude oil production will support freight volume and revenues. On the other hand, volatile global oil prices hold the potential to negatively affect crude-by-rail activity.  

These and other key insights are featured in Freight by Rail: United States. This report forecasts to 2028 US freight railroad revenue in nominal US dollars as well as volume hauled in ton-miles. A ton-mile represents one ton of freight carried one mile. Total revenue and volume are segmented by carrier type in terms of:

•    Class I railroads
•    other freight railroads such as short line and regional railroads

To illustrate historical trends, total revenues, total volume, the various segments, and trade are provided in annual series from 2013 to 2023.

Revenues for railroad freight support activities are also forecast to 2028 and provided in for the 2013-2023 historical period.

More information about the report is available at:

https://www.freedoniagroup.com/freedonia-focus/freight-by-rail-united-states-ff85019.htm 

About Freedonia Focus Reports

Each month, The Freedonia Group publishes over 20 new or updated Freedonia Focus Reports, providing fresh, unbiased analysis on a wide variety of markets and industries. Published in 20-30 pages, Focus Report coverage ranges from raw materials to finished manufactured goods and related services such as freight and construction. Additional Automotive & Transport reports can be purchased at Freedonia Focus Reports. 

Analysis is intended to guide the busy reader through pertinent topics in rapid succession, including:
•    total historical market size and industry output
•    segmentation by products and markets
•    identification of market drivers, constraints, and key indicators
•    segment-by-segment outlook in five-year forecasts
•    a survey of the supply base
•    suggested resources for further study