Trinity Cuts Barge Work Force

While the drop in rail traffic has long cut into demand for new railcars, diversified equipment makers like Trinity Industries were able to keep up their barge building. Now Trinity is cutting jobs in its barge operations.

Its Brusly, La., barge manufacturing plant outside Baton Rouge will lay off 190 workers effective July 17, local reports said, because of falling orders. The facility will continue operating, but the job cuts include administrative and hourly workers.

Trinity bills itself as the largest U.S. builder of inland barges, and until recently that was a growth business that helped the company spread sales out more evenly among its business groups.

Railcar manufacturing still dominates the Trinity business lines, but where back in 2000 railcars brought in 60 percent of company revenue against just 8 percent for barges, by the end of this year’s first quarter barge building was 17 percent of total sales while railcars were down to 32 percent.

Barge revenue even rose 14 percent in the first quarter to $157 million, prompting Chairman, President and CEO Timothy R. Wallace to cite it as “evidence of the benefits Trinity is now reaping from our diversification efforts during the past few years.”

But the prolonged, deep slump in freight demand for everything from export coal to domestic shipments of building materials is taking its toll on orders for more types of equipment.

Trinity had already been cutting jobs in railcar production, and Wallace made clear when he reported earnings that “we are focused on rapidly adapting to the lower product volumes that have resulted from the current economic environment.”

Despite the solid year-over-year sales gains for the barge group in the first three months, there were already warning signs. That unit had a March 31 orders backlog worth $402 million, Trinity said; three months earlier the backlog was $528 million, indicating new orders were not coming in fast enough to maintain the book of business at past output levels.

Contact John D. Boyd at jboyd@joc.com.