PITTSBURGH – Wabtec’s sales surged in the fourth quarter, helping to boost the locomotive and equipment manufacturer’s multiyear backlog to a record $27.4 billion, the company said today.
“The Wabtec team delivered a strong fourth quarter and full year results, reflecting the strength of our business and our ability to execute in dynamic markets,” CEO Rafael Santana said.
Wabtec announced the launch of a modernization program for its Evolution Series locomotives, many of which were introduced in 2005.
“Key new technologies, such as an upgraded control system and EVO Advantage, will be available as part of this EVO mod,” Santana said. “This product is expected to deliver greater than 20% improvement in reliability and tractive effort by replacing DC traction motors and replacing aged electronics and control systems. In addition, the new mods with EVO Advantage are expected to drive up to 7% improvement in fuel savings.”
With Class I railroads pulling back on locomotive orders in recent years, modernizations have become a larger part of Wabtec’s locomotive business as the North American fleet continues to age.
“Fleet renewal is not discretionary,” Santana says. “It is a critical lever our customers have to improve operating ratios, enhance service for their customers, and strengthen their overall competitiveness.”
More than 25% of active locomotives are over 20 years old, and 25% are DC traction units. Railroads can replace three DC locomotives with two modernized AC units, allowing them to reduce fleet sizes while improving productivity and reliability, Wabtec says.
“This aging fleet creates a compelling case for continued modernization,” Santana says. “As locomotives age, failure rates and maintenance costs rise, making modernizations a highly attractive return on our customers’ investment.”
Wabtec executives declined to answer an analysts’ question about the potential impact of rival Progress Rail landing its first major locomotive order in years. Canadian Pacific Kansas City has ordered 65 EMD SD70ACe-T4 units, while also expanding an order with Wabtec for 70 additional ET44AC locomotives. Wabtec delivered 100 of the Tier 4 units to CPKC in 2025.
Quarterly operating income increased 6.6%, to $356 million, as revenue increased 14.8%, to $2.965 billion. Earnings per share, adjusted for the impact of one-time items such as acquisition and restructuring costs, increased 25%, to $2.10.
Freight segment revenue was up 18.3% for the quarter, to $2.1 billion, on higher international locomotive deliveries and mining equipment sales. Revenue in the Freight services segment declined 5%, however, due to fewer locomotive modernizations.
Transit segment revenue grew 6.7% in the quarter thanks to higher sales of both new and aftermarket equipment.
The 12-month backlog grew to $8.23 billion, an increase of 7.2% compared to a year ago. The multiyear backlog was up 23.1%.
For the year, Wabtec expects revenue to grow between 9.2% and 11.8%, with earnings per share growing by 12% to 16.5%.
— To report news or errors, contact trainsnewswire@firecrown.com.
