Railroads
Companies in this industry transport freight and passengers by rail. Major companies include Amtrak, BNSF Railway, CSX, Norfolk Southern, and Union Pacific (all based in the US), along with Deutsche Bahn (Germany), East Japan Railway (Japan), RZD (Russia), and SNCF (France).
The global rail transportation market is forecast to reach about $560 billion by 2026, at a 4.7% compound annual growth rate (CAGR), according to Global Industry Analysts Inc. The rail transport market in the US is about $100 billion in 2021, accounting for about 25% share in the global market. China, Japan, Canada, and Germany are forecast to have a significant growth.
The US railroad industry includes about 630 freight railroads with combined annual revenue of about $80 billion, according to the Association of American Railroads (AAR). Commuter, switching and terminal, and tourist railroads are not included in the industry.
Competitive Landscape
Demand is driven by sales of bulk commodities and other items best transported by rail. The profitability of individual companies depends on operating efficiently and controlling maintenance expenses. Large companies have advantages in owning systems that connect numerous markets and enable them to serve national customers. Small companies can compete effectively by serving local markets.
The US government classifies freight railroads into three classes, based on operating revenue. Seven line-haul Class I railroads -- BNSF Railway, CSX Transportation, Kansas City Southern, Norfolk Southern, Union Pacific, Canadian National Railway, and Canadian Pacific Railway -- operate in the US, according to the Journal of Commerce (JOC) online.
Freight railroads compete mainly with barges, pipelines, and trucks to transport commodities, and with trucks to transport finished goods. Passenger train services typically compete with airlines, bus services, and automobiles.
Products, Operations & Technology
Major services are the transport of commodities, including coal, grain, crushed rock, and chemicals; containers of consumer goods; automobiles; and passengers.
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