The U.S. freight rail network moves the raw goods and finished products that fuel the American economy, from the industrial materials that supply our factories to the consumer goods filling shopping carts.

This critical, efficient and cost-effective network is the best in the world thanks to railroads’ billions of dollars in annual investments. The U.S. Department of Transportation expects total freight demand to grow 30% by 2040. This means the improvements made today are even more important for world-class service tomorrow.

Key Takeaways

  • Privately Owned: The vast majority of America’s freight railroads own, build, maintain, operate and pay for their infrastructure with little or no government assistance.
  • Capital Intensive: In recent years, railroads have spent an average of 19% of revenue on capital expenditures. This is six times more than the average U.S. manufacturer.
  • Sustained Investment: From 1980 to 2019, America’s freight railroads spent more than $710 billion — averaging  more than $26 billion a year over the past five years — on capital expenditures and maintenance expenses. These include locomotives, freight cars, tracks, bridges, tunnels and other infrastructure and equipment.
  • Self-sufficient: Smart public policy allows railroads to earn the revenue they need to maintain and modernize their 140,000-mile rail network.
  • Economic driver: The net economic effect of freight rail’s operations and investments is profound. In 2017 alone, U.S. freight railroads helped spur $219 billion in economic activity and supported approximately 1.1 million jobs across the country.

Keeping American Industries Globally Competitive

Nearly every goods-related industry relies on rail to get its products to market in the U.S. and beyond. These industries include automakers, homebuilders, manufacturers and utilities.

Average U.S. freight rail rates (measured by inflation-adjusted revenue per ton-mile) are 43% lower today than in 1981. This means the average rail shipper can move much more freight for about the same price it paid more nearly 40 years ago. These cost savings help American businesses stay competitive in the global economy. Railroads also haul one-third of all U.S. exports. In fact, 42% of rail traffic and 40,000 domestic rail jobs, worth $4.4 billion in annual wages and benefits, directly tie to international trade.

Improving Rail Safety

Railroads apply technology to nearly every aspect of rail operations to enhance safety and drive efficiency. These innovations include smart sensors, drones, advanced data analytics and training simulators. U.S. freight railroads are also implementing Positive Train Control technology (PTC), which prevents certain types of human-caused accidents by automatically stopping a train.

Helping the Environment

Investments in green technologies, have improved freight car designs while more efficient locomotives have reduced energy consumption, pollution and greenhouse gas emissions. Railroads can move one ton of freight an average of more than 470 miles per gallon of fuel. They are three to four times more fuel efficient than trucks. That means that moving freight by rail instead of trucks reduces greenhouse gas emissions up to 75%, on average.

Easing Infrastructure Damage & Taxpayer Burden

The American Society of Civil Engineers awarded the rail network a B, the highest grade in its 2017 Infrastructure Report Card. The high mark for America’s privately funded freight rail system stands in stark contrast to aging taxpayer-funded highway infrastructure, such as bridges and roads. With a single train hauling several hundred truckloads of freight, U.S. freight railroads ease the burden on the nation’s overcrowded highways — and the taxpayers who pay for them.