Railroads
This industry operates vast networks of tracks to transport heavy freight commodities - such as coal, grain, and chemicals - over long distances with high fuel efficiency.
Why it exists
Railroads transport bulk goods and containers efficiently over long distances with lower cost and lower emissions than trucking.
Why it’s necessary
Industrial supply chains require high-capacity, reliable freight transportation for commodities, manufactured goods, and intermodal shipments.
Key components
Track & infrastructure
Locomotives & rolling stock
Freight terminals
Dispatching & signaling systems
How to evaluate businesses
Operating ratio, network efficiency, intermodal growth, pricing power, and capital discipline are key indicators. Railroads have significant barriers to entry and natural monopoly characteristics.
How the industry could be improved
Automated trains, predictive track maintenance, better intermodal integration, and electrification or hybrid locomotives could reduce costs and increase capacity.