Just saw 2 trains, both westbound, at Osceola, Iowa, with very new looking “CitiRail” locomotives on the point followed by older BNSF locomotives. One was an empty coal train and the other a manifest train with a little bit of everything. How long has BNSF been leasing or testing these new looking engines? I am guessing they are owned by Citigroup bank. Anybody know anything about what I just saw? Not sure of the make or model of these. Thanks.
Citirail is a leasing subsidiary of Citibank. The locomotives are leasers and some of them are on lease to BNSF. The newest ones in the 1200 and 1300 series are ES44AC’s.
These are CREX units, ES44ACs.
They are new, having appeared about four months ago, in October.
CN is apparently also leasing power to BNSF, and reactivating some SD90MACs.
Some CREX units may also still be on the North Shore Mining lines.
Change the reference from CN to CP. CP is leasing nearly 100 AC4400CW and ES44AC locomotives to BNSF, and as a result is power short itself.
CN is running out of units as well, just like every winter. The Wyoming-Prince Rupert coal trains (C721) are now constantly using BNSF/CP run-through power out of Edmonton, as are the Bakken oil trains down east. A CREX unit was spotted in Jasper this past week as well on a train out of Kamloops. And the only thing CN has done to alleviate this is buy the 4 EMD AC demonstrators, which apparently had no end of computer issues on their first trip from Chicago, causing that day’s Q119 to be over 90 hours late. So BNSF and CP are not the only ones with power shortages, but CN is the only one who refuses to fix theirs.
Thanks. Sorry, it was a typo.
BNSF is also leasing some SD75M/SD75Is it sold off a while ago.
They were returned at the end of their lease.
Bank of America?
My apologies for my memory.
Is there a specific reason why BNSF is short of power? Maybe too many scrapped old units? U.S. economy working on the high gear?
Likely several reasons.
The oil train boom is one, as well as lease turn backs (although I did see the SD75s in dead lines for quite a while) and a slow rebounding of the economy.
Ok, seems interesting that volumes changes are so high that several hundred locomotives more are needed. And definitely a good sign for U.S. economy, congratulations there on the other side of the pond! I only wish your wise men were helping poor European economics too…
Picture of the SD70MAC by Gerry Putz.
[8D] saw these units when painted last year in Kansas city, mo. striking paint job.
How does the Citirail leasing business work in general? The first 5-10 they lease their units to the customer, but once the units come back there is still capital left, and the unit is nothing but new by then.
[8D]there must be money to be made as everyone from larrys elecrtric to ge capital is in the engine leasing or refurbishing business
When a railroad gets power short, they get power where they can. This allows people with locomotives available to charge larger rates. When they are not needed, they go back to storage for the next time and railroad that needs locomotives.
Reports are that the CREX locomotives on lease to Northshore Mining have been returned to Mid-America Car, where they were originally stored.
The CREX units apparently were built long before they went into service, supposedly sitting unused for at least several months waiting for a lease. They were built after the front door moved to the engineer’s side of the cab, however.
This keeping locomotives in storage for intermediate is exactly what makes me wonder if there is any sense from the leasers side in the operation. The capital costs are running all the time, even if the units are stored. And stored they will be as the good times and bad times without any “accidents” seem to fluctuate in about 11 year cycles. I doubt the capital of any locomotive can be zeroed in about 7 years time, or what do you think?
It all depends on what the lessor can get from the railroad…
Say, for example, your railroad needs 30 more units than it has to pull a glut of trains. New locomotives would take too long to arrive, and may not be needed after the tonnage surge is over. So, you talk to a lessor, who lends you locomotives. The lease cost is significant, but less than the costs of not operating the trains. So, you pay it, even though it is expensive.
The lessor pays for the capital costs during storage with the revenue from the time the units were on the road, if all goes well and they spend enough time on lease.
The number of trains varies on quite a few factors, such as production of certain commodities.
Citirail has been at it for quite a long time, so they must be making a profit. Usually, the locomotives are older units, largely SD40-2s, retired from Class One service. Brand new units are less common.
There are only 15 CREX ES44ACs, so they are a small portion of the Citirail fleet.
Reports are that they sat in KC from Jan to Sep 2013, brand new, before leases.
That makes sense, still I’m amazed the lessor can charge premium prices on the markets where there is competition.
I think I read somewhere about 50 ES44AC unit additional order for Citirail, or do I remember wrong? Anyway this business sounds like it has been profitable so far.
In Europe we have Railpool, MRCE and Alpha Trains (ex. Angle trains) plus lots of smaller players who lease rolling stock here, mostly powerful electrics. Below a typically colored MRCE fleet loco.
The CREX units may also be for long term lease, I’d suspect, sort of like the high horsepower wide cab CIT units.
Yes, there was another order, which appears to have been built. Thanks, I learn something every day!
[8D]if it makes money even a penny per dollar per month that is more than current interst rates!!