A country’s backbone is its vast transportation network that connects all major hubs of economic trade. The United States has an extensive railway system that touches all corners of the country and the transportation exchange traded fund (ETF) looks like it’s picking up some speed.
CSX Corp. (NYSE: CSX), the second-largest U.S. railroad company, announced that third-quarter profits increased a better-than-expected 43% on higher automotive shipments that helped rail volumes, reports Mark Clothier for Bloomberg. Volume growth increased by 10%, with automotive shipments surging 44%.
Union Pacific Corp. (NYSE: UNP), the largest U.S. transportation company, is investing $2.6 billion in infrastructure capacity for 2010, according to MarketWatch. The company is also launching an advertising campaign to show the company’s shipping logistics expertise and target new business growth. Specifically, the new ad campaign will illustrate the role Union Pacific has with American businesses.
Union Pacific deals with agricultural products, automotive, chemicals, energy, industrial products and intermodal. The company has lines that stretch to the West Coast, Gulf Coast, East Coast, Canada’s railways and gateways to Mexico.
For 2006, the latest year that data was available, the freight railroad industry generated $54 billion in revenue, with seven major railroad systems that created revenues greater or equal to $346.8 million, according to the Federal Railroad Administration. There were 33 regional railroads and over 510 local railroads that spanned almost 141,000 miles in 2006.
For more information on the transportation industry, visit our transportation category.
- iShares Dow Jones Transportation (NYSEArca: IYT)
Max Chen contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.