GLGi: Rail Industry Forecast

1. GLGi: Rail Industry Forecast Toby Kolstad

2. Council Member Biography Toby Kolstad is President of Rail Theory Forecasts, a firm providing consulting and forecasting services in North American rail freight traffic and railcar demand. Mr. Kolstad has more than 35 years of experience in the railroad industry. He also has experience in managing railroad operations. Prior, Mr. Kolstad was Vice President at Greenbrier Leasing, Director of Car Management at The Denver and Rio Grande Railroad, and General Superintendent for the Illinois Central RR. He holds a BS in Mechanical Engineering from Tulane University, an MS in Applied Mathematics from the California Institute of Technology, and an MBA in Operations Research from the University of Chicago.

3. About GLG Institute GLG Institute (GLGiSM) is a professional organization focused on educating business and investment professionals through in-person meetings. It is designed to revolutionize the professional education market by putting the power of programming into the hands of the GLG community. GLGi hosts hundreds of Seminars worldwide each year. GLGi clients receive two seats to all Seminars in all Practice Areas. GLGi’s website enables clients to: • Propose Seminar topics, agenda items and locations • View and RSVP to scheduled and proposed Seminars • Receive a daily briefing with new posts on your favorite tickers, subject areas and from trusted Council Members • Share Seminar details with colleagues or friends

4. Gerson Lehrman Group Contacts Emily Ramey Energy & Industrials Gerson Lehrman Group 850 Third Avenue, 9th Floor New York, NY 10022 212-984-3680 eramey@glgroup.com Aaron Liberman Sales & Marketing Gerson Lehrman Group 850 Third Avenue, 9th Floor New York, NY 10022 212-984-3684 aliberman@glgroup.com Christine Ruane Senior Product Manager Gerson Lehrman Group 850 Third Avenue, 9th Floor New York, NY 10022 212-984-8505 cruane@glgroup.com

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6. Rail Theory Forecasts Rail Trends Progressive Railroading New York City October 3, 2007

7. New Railcar Deliveries

8. Factors Affecting New Railcar Demand • Growth in rail traffic • Railroad operating efficiencies • Popular new railcar designs • Rate of replacement of old cars

9. Railroad Traffic Growth

10. Railroad Operating Efficiencies

11. Popular Car Introductions • Double-stack Intermodal Cars 1985 • 73’ Center-beam Flatcars 1988 • 286k Aluminum Coal Cars 1994

12. Railcar Replacements • 1995----50 year service life approved by AAR for all railcars built after July, 1974 • 2006----65 year service life approved by FRA & AAR for selected car types

13. Coal Cars

14. Coal Car Deliveries

15. Annual Change in Coal Production (%)

16. Coal Train Speeds

17. Coal Car Fleet Age ProfileJuly 2006

18. Flat Cars

19. New Flatcar Deliveries

20. Intermodal Traffic Growth

21. Growth of TEU Imports on West Coast

22. Growth of U.S. Softwood Lumber Production

23. Flatcar Fleet Age ProfileJuly 2006

24. Tank Cars

25. New Tank Car Deliveries

26. Ethanol Production(million gallons)

27. Domestic Ethanol Supply/Demand1000 gallons

28. Disposition of Corn Cropmillion bu.

29. Covered Hopper Cars

30. New Covered Hopper Deliveries

31. Traffic Growth Rates

32. Covered Hopper Fleet Age ProfileJuly 2006

33. Railcar Builder Estimates2007

34. Railcar Builder Estimates2008

35. Rail Theory Forecasts Rail Trends Progressive Railroading New York City October 3, 2007