The environmental and fuel saving benefits of Tier 4 locomotives have been well documented in the rail freight industry.
Not only do they burn up to 25% less fuel than their Tier 3 predecessors, they also reduce emissions by more than 70%.
But the cost of new locomotives that meet the latest Environmental Protection Administration standards is prompting some freight railroads to consider another alternative: retrofitting older locomotives to improve both emissions and pulling capacity.
And that led to the largest existing locomotive upgrade order in the history of Wabtec Corp., which bought GE Transportation in February 2019.
The company announced Wednesday that it has signed what it calls a landmark deal with Union Pacific for 600 locomotive upgrades worth more than $1 billion.
According to a statement from Pittsburgh-based Wabtec, the deal “is the largest investment in modernized locomotives in railroad industry history and is part of Union Pacific’s fleet strategy to move more freight from effective and sustainable manner in its service territory”.
Wabtec is hiring in Erie
While most of the company’s modernization work has taken place at Wabtec’s plant in Fort Worth, Texas, the agreement with Union Pacific should be good news for the Erie plant in the United States. company, which has hired in recent months.
Scott Slawson, president of Local 506 of the United Electrical, Radio and Machine Workers of America, said the union’s active membership grew by about 100 to more than 1,300.
“It’s still going up. They’re still hiring,” Slawson said. “Right now we’re expecting 100 or 150 more before the end of the year.”
Slawson believes there is a connection between the order announced Wednesday and the company’s hiring pattern at the Erie County plant in Lawrence Park Township.
“I can tell you in general that when these orders come in, they’ve been in the works for a while,” Slawson said. “Society had a pretty good idea this was going to happen.”
Tim Bader, a Wabtec spokesman, said the order would mean more work for the Erie-based engineering design team.
But it’s also good news for Erie’s unionized workforce, he said.
“There is work for everyone,” Bader said. “It depends on the capacity of the calendar and the competitiveness.”
Slawson can’t say for sure how much of the rebuilding work will be done in Erie, but he expects the impact to be felt.
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“With any job with a company with multiple locations, you face a workload that moves back and forth,” Slawson said. “At the end of the day, Erie is doing a lot of work for the Fort Worth plant. We’re hiring and we’re still hiring. When you get an order of this size, it’s always good news.”
The company’s Grove City plant, which builds and rebuilds locomotive engines, can also expect a boost from the deal.
According to the company, Wabtec will upgrade 525 Union Pacific AC4400 and AC6000 locomotives, as well as 75 Dash-9 locomotives.
What does modernization mean?
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Wabtec said in a press release that the upgraded locomotives will include new digital innovations, an improved engine and new control technology. Although the upgraded locomotives do not match Tier 4 locomotives, they will extend the life of the locomotive, increase fuel efficiency by up to 18%, improve reliability by over 80%, and increase hauling capacity over 55%.
“It’s a great way to maximize existing assets,” Bader said. “Not only that, but from a fuel and emissions perspective, they can use these older locomotives which will now have more power to pull.”
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This agreement is Union Pacific’s third major modernization order since 2018. By the time the order is filled in 2025, Wabtec will have delivered more than 1,030 modernized locomotives to Union Pacific.
Deliveries are expected to begin in 2023.
According to conventional wisdom, high fuel costs are generally good news for the rail freight industry as companies look for more economical ways to move goods, Slawson said.
But the ability to modernize an old locomotive presents an option for the railroad.
A Tier 4 locomotive produces the lowest emissions and best fuel economy.
“While that’s great for the world we live in today, the railroads have to weigh that expense,” Slawson said. “If you can do a full rebuild for a fraction of the price.”
Jim Martin can be reached at [email protected]