LAKE OSWEGO, Ore., May 1, 2015 /PRNewswire/ -- The Greenbrier
Companies, Inc. (NYSE:GBX) today responded to the U.S. Department
of Transportation's (U.S. DOT) and Transport Canada's (TC) joint
final rule on the safe movement of flammable liquids by rail,
including crude oil and ethanol.
"We commend both governments for delivering a rule today that
advances public safety and protection of the natural environment.
Railroads are the safest way to haul large volumes of freight long
distances in America, but when it comes to oil, ethanol and other
hazardous liquids, more robust tank cars are needed to ensure the
safety of our communities. The health, property and general
well-being of our citizens shouldn't be at risk in the event of an
accident and the design for the newly designated DOT-117/TC-117
tank car will help substantially mitigate risk," said William A. Furman, Chairman and CEO,
Greenbrier.
Greenbrier announced its "Tank Car of the Future" in
February 2014, a safer design for
crude oil and ethanol service and the transport of other hazardous
materials which U.S. DOT and TC introduced today as the new
DOT-117/TC-117.
Greenbrier believes that by mandating the new DOT 117/TC-117
tank cars be built with features such as increased shell thickness,
added full-height 1/2" head shields, minimum 11-gauge jackets, a
re-closeable pressure relief valve and thermal protection,
the United States and Canada have taken steps to mitigate the
consequences of train accidents and ultimately enhance public
safety. These tank car design improvements produce tangible and
immediate safety benefits that far exceed any marginal benefit from
U.S. DOT-mandated ECP brakes, which Greenbrier has consistently
questioned.
"I'm proud to say we're currently delivering cars to our
customers that meet these new standards. Nearly 1,000 of these
Greenbrier-designed and built tank cars are already in Class 3
flammable liquids service across North America. With orders
in place for more than 2,500 cars of the DOT 117/TC-117 design,
safer tanks cars are steadily joining the North American rail
fleet," continued Furman.
Greenbrier is prepared to meet the need for tank car retrofits
through GBW Railcar Services (GBW), its 50/50 joint venture with
Watco Companies LLC for railcar repair and retrofitting. GBW is
making significant new investments in its repair shop capacity to
help ensure the industry's ability to conduct the required tank car
retrofits. GBW has obtained commitments from leading tank car
owners to perform thousands of tank car retrofits, in the manner
described in today's rule.
"Through GBW we've laid the groundwork to meet the need for tank
car retrofits required by the new rule. We look forward to
continuing our work with our customers to address the achievable
timeline announced today," Furman continued.
Greenbrier asserts that a rapid replacement and retrofit
phase-out timeline is completely feasible. A report prepared for
Greenbrier by Cambridge Systematics (the "Cambridge report") indicates retrofit capacity
will range from at least 8,400 to 19,600 cars per year in steady
state, and that the unjacketed DOT-111s and unjacketed CPC-1232s in
crude oil service could be retrofitted in 3.7 years, while similar
cars in ethanol service could be retrofitted in an additional 2.3
years.
In addition to examining tank car retrofit capacity, the
Cambridge report goes on to note
that in 2015 manufacturing capacity for new tank cars is at an
all-time high of over 40,000 units. With manufacturing
capacity at these levels, the Cambridge report observes that the entire tank
car fleet that is currently operating without advanced safety
features could be replaced in less than five years with new cars
that meet current standards for safety.
"The rule issued today takes important strides toward greater
public safety. Ultimately, it is implementation of the rules that
will make safer transport of flammables a reality. We look forward
to working with stakeholders across the rail industry and the
governments of the United States
and Canada toward meeting the
achievable tank car design retrofit timeline established in today's
rule," Furman concluded. "North
America's rail network is strong and these tank car design
rules will help it endure as a vital mode of transportation for
generations to come."
About Greenbrier Companies
Greenbrier, (www.gbrx.com), headquartered in Lake Oswego, Oregon, is a leading supplier of
transportation equipment and services to the railroad industry.
Greenbrier builds new railroad freight cars in our 4 manufacturing
facilities in the U.S. and Mexico
and marine barges at our U.S. manufacturing facility.
Greenbrier also sells reconditioned wheel sets and provides
wheel services at 9 locations throughout the U.S. We
recondition, manufacture and sell railcar parts at 4 U.S.
sites. Greenbrier is a 50/50 joint venture partner with Watco
Companies, LLC in GBW Railcar Services, LLC which repairs and
refurbishes freight cars at 34 locations across North America, including 14 tank car repair
and maintenance facilities certified by the Association of American
Railroads. Greenbrier builds new railroad freight cars and
refurbishes freight cars for the European market through our
operations in Poland. Greenbrier
owns approximately 8,300 railcars, and performs management services
for approximately 241,000 railcars.
"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995: This press release may contain
forward-looking statements, including statements regarding expected
new railcar production volumes and schedules, expected customer
demand for the Company's products and services, plans to increase
manufacturing capacity, restructuring plans, new railcar delivery
volumes and schedules, growth in demand for the Company's railcar
services and parts business, and the Company's future financial
performance. Greenbrier uses words such as "anticipates,"
"believes," "forecast," "potential," "goal," "contemplates,"
"expects," "intends," "plans," "projects," "hopes," "seeks,"
"estimates," "strategy," "could," "would," "should," "likely,"
"will," "may," "can," "designed to," "future," "foreseeable future"
and similar expressions to identify forward-looking
statements. These forward-looking statements are not
guarantees of future performance and are subject to certain risks
and uncertainties that could cause actual results to differ
materially from in the results contemplated by the forward-looking
statements. Factors that might cause such a difference
include, but are not limited to, reported backlog and awards are
not indicative of our financial results; uncertainty or changes in
the credit markets and financial services industry; high levels of
indebtedness and compliance with the terms of our indebtedness;
write-downs of goodwill, intangibles and other assets in future
periods; sufficient availability of borrowing capacity;
fluctuations in demand for newly manufactured railcars or failure
to obtain orders as anticipated in developing forecasts; loss of
one or more significant customers; customer payment defaults or
related issues; actual future costs and the availability of
materials and a trained workforce; failure to design or manufacture
new products or technologies or to achieve certification or market
acceptance of new products or technologies; steel or specialty
component price fluctuations and availability and scrap surcharges;
changes in product mix and the mix between segments; labor
disputes, energy shortages or operating difficulties that might
disrupt manufacturing operations or the flow of cargo; production
difficulties and product delivery delays as a result of, among
other matters, inefficiencies associated with expansion or start-up
of production lines or increased production rates, changing
technologies, transfer of production between facilities or
non-performance of alliance partners, subcontractors or suppliers;
ability to obtain suitable contracts for the sale of leased
equipment and risks related to car hire and residual values;
integration of current or future acquisitions and establishment of
joint ventures; succession planning; discovery of defects in
railcars or services resulting in increased warranty costs or
litigation; physical damage or product or service liability claims
that exceed our insurance coverage; train derailments or other
accidents or claims that could subject us to legal claims; actions
or inactions by various regulatory agencies including potential
environmental remediation obligations or changing tank car or other
rail car or railroad regulation; and issues arising from
investigations of whistleblower complaints; all as may be discussed
in more detail under the headings "Risk Factors" and "Forward
Looking Statements" in our Annual Report on Form 10-K for the
fiscal year ended August 31, 2014,
and our other reports on file with the Securities and Exchange
Commission. Readers are cautioned not to place undue reliance
on these forward-looking statements, which reflect management's
opinions only as of the date hereof. Except as otherwise
required by law, we do not assume any obligation to update any
forward-looking statements.
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SOURCE The Greenbrier Companies, Inc. (GBX)