📄 Extracted Text (399 words)
31 October 2017
Railroads
Canadian Rails
the course of a trip. In general, cargo includes almost everything under the sun,
from electronics to food to furniture. In both the U.S. and Canada, retail sales is
generally the best gauge for prospective movements in intermodal volumes.
Figure 41: YoY change in U.S. Intermodal volumes and
U.S. retail sales
15% 30%
I
Figure 42: YoY change in Canadian Into/modal volumes
(RHS) and CA retail sales (LHS)
10% 30%
10% a. 20%
5% 10%
0% 0%
(5%) (10%)
(10%) (20%)
Correlation: 83% Correlation: 88%
(15%) (30%) (10%) (30%)
in CO N M 'e in '4 IA LO r. co cn 0 et N M to
8 2 2 9 71 . ...
wow U.S. Intermodal Volumes —U.S. Retail Sales mum CA Intermodal Volumes —CA Retail Sales
San. paean.Bank MR. feaSie Semi CAtasS AAA feetSAt
Since 2000, U.S. and Canadian Intermodal volumes have increased at a 2.4%
and 3.4% CAGR, respectively (vs. 2016) with growth averaging roughly 5% from
2011-2014 as railroad customers made significant investments in capacity and
improved service. Volumes were also positively impacted in 2013-2014 in part
by tighter trucking capacity (which drives spill-over effect to rails) and higher
fuel costs given rail's significant fuel efficiency advantage. Intermodal volumes
came under pressure in late-2015 due to the collapse in fuel prices, looser truck
capacity, and a stronger USD. To that point, NA intermodal volumes declined
1.5% yoy in 2016. Year-to-date, however, intermodal volume growth has returned
(up 5% yoy through 30) due to a modestly tighter truckload market and a weaker
USD (reviving international trade).
_.._..._..._.._._._._._._._.._.._._
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Figure 43: Avg. weekly U.S. Intermodal volumes and Figure 44: Avg. weekly CA Intermodal volumes and Yee
YoY changes (2000-'17 30) changes (2000-'17 30)
300,000 30% 80,000 30%
250,000 20% 70,000 20%
60,000
200,000 10% 10%
50,000
150,000 0% 40,000 0%
100,000 (10%) 30,000 (10%)
20,000
50,000 (20%) 10,000 (20%)
0 (30%) 0 (30%)
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Intermodal Volumes —YoY a Intermodal Volumes --YoY
Sarre Deiasche Bank MR Sago. Ouse. Sink AM
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Page 24 Deutsche Bank Securities Inc.
CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0064294
CONFIDENTIAL SDNY_GM_00210478
EFTA01371102
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EFTA01371102
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