KCSR secures loan from US DOT for 30 locomotives

23 February 2012 (Last Updated February 23rd, 2012 18:30)

Kansas City Southern Railway (KCSR) has secured a $54.6m loan from the US Department of Transportation (DOT) to buy 30 new diesel-electric locomotives.

Kansas City Southern Railway (KCSR) has secured a $54.6m loan from the US Department of Transportation (DOT) to buy 30 new diesel-electric locomotives.

The loan is expected to cover 80% of the cost of the locomotives, to be built by General Electric in Erie, Pennsylvania, US, which will use less energy and emit less carbon than the locomotives due to be replaced.

US Department of Transportation Secretary Ray LaHood said: "This is the kind of investment in our transportation systems that creates jobs, boosts the economy and improves the flow of goods."

The new locomotives are expected to create a safer operating environment through improved train handling, more crashworthy cabs and advanced train controls that encourage crew alertness.

The new locomotives will be used throughout KCSR's system to ship commodities and products, including coal, chemicals, grain, sand, stone, gravel, plastics, metals, and automobiles.

Currently, KCSR has 475 locomotives in operation in the US and 356 in Mexico.

Federal railroad administrator Joseph Szabo said: "The RRIF program is a model of how we can leverage federal dollars to stimulate private investment and grow the economy."

"The program provides steady, affordable financing for major rail construction and expansion projects," Szabo said.

The loan is from the Federal Railroad Administration's Railroad Rehabilitation and Improvement Financing (RRIF) Program, which is intended to help acquire, improve, or rehabilitate rail and rail-related intermodal equipment and facilities in the US. There is currently up to an aggregate of $35bn available in the RRIF program for these types of projects.