In the boxcar fleet, retirements will continue to exceed deliveries, but the delivery pace will pick up considerably. Whether this is the beginning of a build cycle that will provide relief to a fleet with a huge retirement cycle looming, only time will tell. But availability will remain tight, with the corresponding lease rate implications.
Gondola and open-top hoppers will continue their march downward in overall size with the continued rightsizing of the coal car fleet. Retirements will be strong and deliveries minimal to nil, but the supply/demand characteristics are slowly improving (although not enough for any material lease rate improvement). The exception is the mill gondola segment, which will continue to see increased utilization, growing new car demand, and again, the corresponding lease rate implications.
All told, there is a lot to look forward to in 2022. While there are always risks to any forecast, the upside risks outweigh the downside risks, in my opinion. For this reason, I’m more optimistic for 2022 than I was for 2021.
