What do you make of Class I capital spending trends?

Abhbw 2010

Well, 2019 will be the first up year for the industry even as PTC moves from a capital expense to an operating expense. But this is always an area of concern. Short-term-oriented shareholders are, in reality, only a smallish but vocal segment of the total ownership, but they have influenced rail management on at least two big railroads. The biggest carrier in the east, CSX, almost completed its PSR process, and the biggest in the west, Union Pacific, in the middle innings of its operational restructuring, have both slashed their Capex (as a percentage of revenues, not the best but the only comparative measurement). Meanwhile, Norfolk Southern stands by the 21stcentury historic range of 16% to 18%. And (look to the North!) Canadian National and Canadian Pacific are spending well above 20% of their revenues. Note they also have the best growth rates, and the best return on capital (a far better measurement than operating ratio!) in the freight rail industry!