Norfolk Southern Railway’s domestic intermodal business grew 35 percent year-over-year in April, expanding at a faster pace than even a robust first quarter for the business, Chairman, President and CEO CEO Charles W. Moorman told the railroad’s annual shareholder’s meeting Thursday.
Moorman said the eastern Class 1 railroad’s “international import container volumes remain relatively weak, indicative of a less-than-robust retail sector.”
But April’s domestic box moves on NS, he said, escalated from the 23 percent gain they showed in the first quarter from a year earlier. The gains this year follow flat domestic intermodal volume in 2009, “which actually represented a share shift to rail” from trucking, he said, as overall freight traffic contracted in the recession.
“We believe that every day that goes by lessens the chance of a second dip in the economy,” Moorman said, “but we do remain guarded about the pace of the domestic economic recovery.” He said economic growth between 2.5 and 3 percent “over the next couple of years is probably a reasonable assumption.”
He noted despite a rebound in NS traffic from last year, first quarter 2010 volume of 1.58 million units was still 14 percent below the 2008 first quarter level and 19 percent below the company’s all-time high in the 2006 first quarter.
“While the economic recovery is under way, there is a long way to go before we see the levels of economic activity of a few years ago,” he said.
Moorman said last month’s bulk carloadings “reflect the traffic patterns of the first quarter with some areas of real strength – agricultural products, driven by ethanol and export grain; chemicals; steel; domestic metallurgical coal; and export coal.”
Domestic utility coal business had been “quite depressed” for several quarters but perked up some in April, he said. However, “anything related to housing continues to be anemic.”
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