Soaring fuel prices have hampered several enterprises, but indirectly benefited the railroads.
The freight railway industry is one of the economy's bright spots. Due to growing global trade and rising fuel costs for trucks, the freight industry is enjoying one of its most dynamic periods in nearly a century.
The figures tell the story: In 2002, major railroads laid off 4,700 workers; in 2006, they hired more than 5,000, the Washington Post reported. Railroads have doubled profits since 2003 and stock prices are high. The value of Union Pacific, the nation's largest railroad, has increased threefold since 2001.
The rail industry has seen its ups and downs. In the 1970s, it suffered from strict federal regulation and the difficulty of competing with trucks. The nation's 300,000 miles of tracks were poorly maintained. Deregulation in 1980 caused more than 40 major lines to consolidate into seven that now run on 162,000 miles of track, according to the Post.
But today's global market and high fuel prices mean prosperity for the railroads, which are adding track for the first time in 80 years. Much freight that would have been handled by trucks a few years ago is now being hauled by the railroads.
China's desire for coal and U.S. demand for Chinese goods mean that much rail traffic is heading to ports in the Northwest.
"Coal still accounts for the most tonnage hauled by U.S. railroads, but it is the ocean-crossing shipping container — carrying autos, toys, furniture and nearly every product a consumer will buy — that has lit a rocket under the railroad industry," the Post reports.
Passenger rail traffic has been growing as well. Amtrak has posted five consecutive years of increased ridership — up 6 percent from 2006.
Trains are also considered fuel-efficient, able to haul a ton of freight 423 miles on one gallon of diesel fuel. Since 2003-03, rail traffic has soared, along with revenue and profits.
That reversal of fortune underscores America's need to keep its options open when it comes to transportation, shipping and mass transit.
