Buying Railcars, then leasing them to railways.

Trains Magazine General Discussion
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Re: owning a private coach , business car or other rolling stock see aaprco.com. This site has links to a number of sellers of railcars.

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It seems to me that locomotives also fall under the lease category. I’m not talking about Precision or any of the well know “leasing” companies. What’ I’m thinking of involves the locos being owned by “Trusts”, who then lease the loco to the railroad. As far as RR ops go, it’s the RRs loco, painted and all. Aside from that, somebody with more info than me will have to elaborate. It’s also possible that the same is true of some cars.

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Getting back to Macguy’s original question about freight cars. The article in the January issue of Trains that we have been picking at also includes a section entitled Who Builds What. This lists the major freight car manufacturers, and what kinds of cars they produce.

Remember I said GATX before, well here’s another one with a twist. ACFX!!!

It seems that big time money guy Carl Icahn owns ACF Industries which makes a number of different styles of freight cars, but mainly specialized tank cars, and those very distinctive centerflow hoppers.

The twist is that they don’t just sell them to the railroads, they lease them too. Talk about having all the bases covered.[swg]

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It was a comment just like that one that someone sasid to me that got me curious about this whole thing in the first place.

They said something about how it was the trend and dendists and what no were going out and buying a railcar or two then leasing them out.

I guess it just doesn’t happen any more where a person or two would just own a couple of their own cars and lease them out, it’s all the big leasing companies now.

Anyone know how they track their cars from location to location?
Is there a centralized website somewhere where they loginto? AAR website somewhere or something?

25

Tisk tisk, the railroads must have been doing it a different way for a long time, since they have been operating way longer than computers and the internet have been around. Certainly into the 70’s it was done with paperwork. When did the first optical car scanners come along? Remember those red and blue stripes on those black plates?

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Surely it’s not still done long hand, must be computerized by now.

I think in the old days there was more point to point stuff, not much travel all around the place like the North American box car pools do it now.

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I looked at the CFCLA website for Australian operations, and it is interesting. Most of the lcomotive specs look like they were drawn verbatim from John Cleverdon’s Locopage. http://locopage.railpage.org.au/

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Oh, I couldn’t imagine any other way today, but I did give myself a 30 or so year cushion.[;)]
If anyone knows for sure, please speak up.[:)]

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LC

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LC

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LC

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I once worked for the leasing group of a Wall Street investment bank. We analyzed and put together the financing of such deals.

Yes, it takes a lot of money, but the real question is why a company should lease rather than simply buy equipment. Usually the decision to lease depends on taxes and the financial condition of the firm.

Here are a few of the advantages.
From the lessor’s side:

  1. Can take advantage of tax credits that may be unavailable or unusable by the lessee
  2. Cost of capital to buy equipment is frequently less for the lessor because they’re usually in better financial condition
  3. Can redeploy returned equipment faster than lessee

From the lessee’s side:

  1. Doesn’t have to carry equipment on books
  2. Doesn’t have to tie up capital in equipment that they may need only temporarily or sporadically
  3. Can have a positive effect on earnings per share (eps)

Not surprisingly, many of our clients were transportation companies.

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Check out http://www.sircrail.com and how they got started

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Thanks for the link, good reading.