CHICAGO, May 6 /PRNewswire-FirstCall/ -- GATX Corporation (NYSE: GMT)
today stated that the Federal Railroad Administration (FRA) issued a
Railworthiness Directive relating to a certain class of tank cars that were
built or modified with reinforcing bars by GATX Rail prior to 1974. In its
Directive, the FRA indicated that cars within this class must be inspected,
and repaired if necessary, according to an FRA approved maintenance plan.
The FRA has approved a plan under which the affected cars will be
inspected and, if necessary, a determination will be made regarding repair,
retrofit, or scrapping of the cars. GATX is taking steps to maintain
efficient customer service during the inspection process, including the use of
existing idle cars or new cars to replace those affected by this Directive.
GATX Rail stated that approximately 4,200 of its owned railcars are
affected by this Directive. The affected cars represent approximately 3% of
GATX Rail's total North American fleet, account for approximately $4 million
of GATX Rail's $3.8 billion investment in rail assets, and were expected to
generate approximately 1%, or $9 million, of GATX Rail's expected 2002
revenue. The revenue contribution associated with these cars over the next
several years was anticipated to decline due to their planned retirement.
GATX Rail stated that the net income effect of the Directive is expected to be
less than $10 million after-tax in 2002, and is not expected to be material in
years thereafter.
GATX Rail ceased manufacturing railcars in 1983. Prior to that time, GATX
Rail manufactured cars for its own leasing business and for third-party
customers. This Directive applies to the affected cars manufactured and owned
by GATX Rail and to cars in the affected class that are currently owned by
third parties. GATX is making efforts to contact current third-party car
owners to inform them of this Directive.
COMPANY DESCRIPTION
GATX Corporation (NYSE: GMT) is a specialized finance and leasing company.
It uniquely combines asset knowledge and services, structuring expertise,
partnering and risk capital to provide business solutions to customers and
partners worldwide. GATX specializes in railcar and locomotive leasing,
aircraft operating leasing, information technology leasing, venture finance
and diversified finance.
FORWARD-LOOKING STATEMENTS
Certain statements within this document may constitute forward-looking
statements made pursuant to the safe harbor provision of the Private
Securities Litigation Reform Act of 19995. These statements are identified by
words such as "anticipate," "believe," "estimate," "expects," "intend,"
"predict," or "project" and similar expressions. This information may involve
risks and uncertainties that could cause actual results to differ materially
from the forward-looking statements. Although the company believes that the
expectations reflected in such forward-looking statements are based on
reasonable assumptions, such statements are subject to risks and uncertainties
that could cause actual results to differ materially from those projected.
Risks and uncertainties include, but are not limited to, general economic
conditions, aircraft and railcar lease rate and utilization levels, conditions
in the capital markets and the potential for a downgrade in our credit rating,
either of which could have an effect on our borrowing costs or our ability to
access the markets for commercial paper or secured and unsecured debt;
dynamics affecting customers within the chemical, petroleum and food
industries; unanticipated costs or issues arising from the Federal Railroad
Administration's Railworthiness Directive HM-04; competitors in the rail and
air markets who may have access to capital at lower costs that GATX;
additional potential write-downs and/or provisions within GATX's portfolio;
and general market conditions in the rail, air, technology, venture, and other
large-ticket industries.
Investor, corporate information and press releases may be found at
http://www.gatx.com . A variety of current financial information, historical
financial information, press releases and photographs are available at this
site.
SOURCE GATX Corporation
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Related links:
http://www.gatx.com
Company News On-Call:
http://www.prnewswire.com/gh/cnoc/comp/105121.html
CONTACT:
Analysts and Investors, Robert C. Lyons of
GATX Corporation, +1-312-621-6633
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