About FreightCar America

FreightCar America, Inc. operates as a manufacturer of railcars and railcar components. The company designs and manufactures a broad variety of railcar types for transportation of bulk commodities and containerized freight products primarily in North America, including open top hoppers, covered hoppers, and gondolas along with intermodal and non-intermodal flat cars. During 2019, the company entered into a joint venture arrangement with Fabricaciones y Servicios de Mexico, S.A. de C.V. (Fasemex), a Mexican company with operations in both Mexico and the United States, to manufacture railcars in Castaños, Coahuila, Mexico (Castaños), in exchange for a 50% interest in the operation. Production of railcars at the facility began during the third quarter of 2020. On October 16, 2020, the company acquired Fasemex’s 50% ownership in the joint venture. As of March 2021, the company moved all of its production to the Castaños facility. The company leases freight cars through its leasing entities, including JAIX Leasing Company, and FreightCar America Leasing 1, LLC. Although the company continually looks for opportunities to package its leased assets for sale to its leasing company partners, these leased assets may not be converted to sales, and may remain revenue producing assets into the foreseeable future. The company also rebuilds and converts railcars and sell forged, cast and fabricated parts for all of the railcars it produces, as well as those manufactured by others. The company’s primary customers are shippers, railroads, and financial institutions which represented 38%, 36% and 22%, respectively, of its total sales attributable to each type of customer for the year ended December 31, 2022. In the year ended December 31, 2022, the company delivered 3,184 railcars, including 2,281 new railcars and 903 rebuilt railcars. Products and Services The company designs and manufactures a broad variety of freight cars, including covered hoppers, open top hoppers, gondolas, intermodal and non-intermodal flat cars that transport numerous types of dry bulk and containerized freight products. The company rebuilds and converts railcars and sell forged, cast and fabricated parts for all of the railcars it produces, as well as those manufactured by others. Many of the company’s railcars are produced using a patented one-piece center sill, the main longitudinal structural component of the railcar. In addition to railcars designed for use in North America, the company has manufactured railcars for export to Latin America and the Middle East. Railroads outside of North America are constructed with a variety of track gauges that are sized differently than in North America, which requires the company, in some cases, to alter its manufacturing specifications accordingly. VersaFlood Hopper Cars: The VersaFlood product series offers versatile design options for transportation of aggregates, sand or minerals. The company’s VersaFlood series open-top hopper railcars include steel, stainless steel or hybrid steel and aluminum-bodied designs equipped with three-pocket (transverse gate) or two-pocket (longitudinal gate) discharge door systems with manual, independent or fully automatic door operation. Covered Hopper Cars: The company’s covered hopper railcar product offerings encompass a wide range of cubic foot (cf) capacity designs for shipping dry bulk commodities of varying densities, including 3,282 cf covered hopper cars for cement, sand and roofing granules; 4,300 cf covered hopper cars for potash or similar commodities; 5,200 cf, 5,400 cf and 5700 cf covered hopper cars for grain and other agricultural products; and 5,800 cf and 6,250 cf covered hopper cars for plastic pellets. DynaStack Series: The company’s intermodal doublestack railcar product offering includes the DynaStack articulated 3-unit, 53’ well cars for transportation of international and domestic containers. Steel Products Cars: The company’s portfolio of railcar types also includes 52’ and 66’ mill gondola railcars used to transport steel products and scrap; slab, hot slab and coil steel railcars designed specifically for transportation of steel slabs and coil steel products, respectively. Boxcars: The company’s high capacity boxcar railcar product offerings, featuring inside length of 50’, single plug door and 60’9”, double plug doors, galvanized steel roof panels and nailable steel floors, primarily designed for transporting paper products, paper rolls, lumber and wood products and foodstuffs. Aluminum Coal Cars: The BethGon is the leader in the aluminum-bodied coal gondola railcar segment. The company’s BethGon II features lighter weight, higher capacity and increased durability suitable for long-haul coal carrying railcar service. The company has received several patents on the features of the BethGon II and continue to explore ways to increase the BethGon II’s capacity and reliability. The company’s aluminum bodied open-top hopper railcar, the AutoFlood, is a five-pocket coal car equipped with a bottom discharge gate mechanism. Both the AutoFlood II and AutoFlood III designs incorporate the automatic rapid discharge system, the MegaFlo door system, a patented mechanism that uses an over-center locking design, enabling the cargo door to close with tension rather than by compression. Further, AutoFlood railcars can be equipped with rotary couplers to permit rotary unloading. Stainless Steel and Hybrid Stainless Steel/Aluminum Coal Cars: The company manufactures a series of stainless steel and hybrid stainless steel and aluminum AutoFlood and BethGon coal cars designed to serve the Eastern railroads. These coal cars are designed to withstand the rigors of Eastern coal transportation service. They offer a unique balance of maximized payload, light weight, efficient unloading and long service life. The company’s coal car product offerings include aluminum-bodied flat-bottom gondola railcars and steel or stainless steel-bodied triple hopper railcars for coal, metallurgical coke and petroleum coke service. Other Railcar Types: The company’s other railcar types include non-intermodal flat railcars and bulkhead flat railcars designed to transport a variety of products, including machinery and equipment, steel and structural steel components (including pipe), wood and forest products and other bulk industrial products; woodchip hopper and gondola railcars designed to haul woodchips and municipal waste or other low-density commodities; and a variety of commodity carrying open top hopper railcars designed to carry ballast, iron ore, taconite pellets and other bulk commodities; the AVC Aluminum Vehicle Carrier design used to transport commercial and light vehicles (automobiles and trucks) from assembly plants and ports to rail distribution centers; and the articulated bulk container railcar designed to carry dense bulk products, such as waste products in 20’ containers. Railcar Conversions: The company is a leader in rebuilding and repurposing freight car assets. From complete car rebuilds to transforming unused railcars into the latest designs, the company delivers customer-focused solutions. The company has completed over 14,000 total conversions and rebuilds in the last decade and offer a broad portfolio of over 20 car conversion options. The company’s new, purpose-built facility supports a wide variety of conversion options , including small cube covered hopper conversions, aluminum body railcar conversions, sand railcar modularized lengthening modification programs and railcar modularized modification programs altering the nature of the center sill in the modified railcar. Customers The company’s customer base consists mostly of North American shippers, railroads, and financial institutions. In 2022, revenue from three customers, Union Pacific Railroad, Vulcan Materials Company and Infinity Transportation, accounted for approximately 20%, 19% and 16%, respectively, of total revenue. Sales and Marketing The company’s direct sales group is organized by customer and geography and consists of vice presidents of sales (VPs), contract administrators, a manager of customer service, a director of field support, and support staff. The VPs are responsible for developing and closing new business and managing customer relationships. The company’s contract administrators are responsible for preparing proposals and other inside sales activities. The company’s director of field support is responsible for after-sale follow-up, technical support, training, and in-field product performance reviews. Suppliers The company’s primary aluminum suppliers are Ryerson Metals and Hydro Extrusions. Its primary steel suppliers are Feralloy Corporation and Reibus International. In 2022 the company primarily bought fabrications from local suppliers, with Fasemex being the largest of the local suppliers. The company’s primary component suppliers include Wabtec, Amsted, Standard Steel, SKF, and Metalex, who supply it with truck components, brake components, couplers, wheels & axles, bearings, and running boards, respectively. Roll Form Group is the sole supplier of the company’s roll-formed center sills, which were used in 53% of its new railcars produced in 2022. The company’s top ten suppliers accounted for 62% of its total purchases in 2022. Competition The company has three principal competitors in the North American railcar market that primarily manufacture railcars for third-party customers, which are Trinity Industries, Inc.; The Greenbrier Companies, Inc.; and National Steel Car Limited. Governmental Regulation The company must maintain certifications with the Association of American Railroads (AAR) as a freight railcar manufacturer and products that it sells must meet AAR and FRA (Federal Railroad Administration) standards. History FreightCar America, Inc. was founded in 1901.