Wall Street Journal: Why Railroads Can’t Keep Enough Boxcars in Service

By The Railway Supply Institute

In 2015, the Wall Street Journal brought attention to a critical issue impacting the US economy with reporter Bob Tita’s article: “Why Railroads Can’t Keep Enough Boxcars in Service.”

The piece highlighted a significant decrease in the boxcar fleet over the preceding decade—a 41% reduction—with an alarming rate of boxcars being scrapped and insufficient replacements being introduced. Industries reliant on these boxcars for transporting their goods, particularly paper manufacturers and lumber producers, found themselves facing a shortage. They warned of production slowdowns and the inevitable shift to more costly truck transportation, drawing attention to an urgent need for the Surface Transportation Board (STB) to take decisive action in reforming railcar hire rates. 

A 2020 economic impact study by the Brattle Group further showed the investment disincentive in new boxcar production caused by an antiquated railcar hire rate system. 

In 2021, the industry experienced another boxcar shortage.

With a substantial portion of the fleet nearing the mandatory retirement age, the STB must revise the EP 334 rules—pertaining to negotiation and arbitration of car hire rates—to reflect modern market conditions and ensure a viable future for freight rail and the industries it serves. 

The cycle of shortages is nearly inevitable without reform.

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