Plasser American
Rail Tech for America’s Backbone
Plasser American and its Austrian parent, Plasser & Theurer develop, manufacture, and service fully mechanized methods of work for the construction and maintenance of rail tracks. The company is the only manufacturer in the world that offers a complete range of machines for track laying, track maintenance, and measuring work. New Austrian spoke with Thomas Blechinger, CEO of Plasser American, about the company’s work in the United States.
Machine at work: The Unimat 09-4x4/4s all-electric tamping.
PHOTO: PLASSER & THEURER
Mr. Blechinger, thank you for taking the time to speak with us. What kind of machines does Plasser American produce, and what do they do?
Thanks for having me, it’s a pleasure to be here. Plasser & Theurer and its affiliates are the global market leader in maintenance of way equipment. Maintenance of way equipment refers to the construction and maintenance equipment made for railroad infrastructure. So the equipment that we are manufacturing is, for instance, used for laying new tracks, cleaning the ballast, replacing ties and rails, as well as tamping—restoring the track geometry back to the most accurate and most suitable position—to allow a smooth, comfortable, and safe ride for freight as well as passenger rail.
Is that what tamping means? To readjust the geometry of the track?
Actually, there is a little bit more to it. Tamping is the process that compacts the ballast underneath the ties. This is done with a hydraulic tamping machine—a technology developed by Plasser & Theurer in Austria close to seventy years ago. The lifting and lining of the track restores the geometry of the track, tamping ensures that the track stays in the corrected position. All this happens through a fully automated, computerized process. To have a consistent and very accurate track geometry is of utmost importance on all railroads. But of course, the higher the maximum speed on those railroad lines is, the more critical it gets, with only a small amount of tolerance in track geometry. To have a consistent and very accurate geometry is crucial for a safe and comfortable ride, but also to reduce wear and tear on the train coaches, the locomotives, and freight cars.
So you produce the machines that provide these services. Who uses them here in the United States?
In the United States all of the Class I railroads, like CSX, BNSF, Union Pacific, Canadian National, Canadian Pacific, etc. use them.
What is a Class I railroad?
A Class I railroad means that company needs to have a certain size, which is defined by revenue; those are the big players so to say. There are seven of them in North America: CSX, Union Pacific, BNSF, Canadian National, Canadian Pacific, Kansas City Southern, and Norfolk Southern—so all those large freight carriers, the large freight railroads. All of them are our customers. But we also serve the public transport side, the commuter rails and the metros, the urban areas. New York City Transit, for example, or Metro North, MBTA in Boston, Florida, Miami Dade, and so forth. We also serve customers on the West Coast like the Bay Area, in San Francisco, for example. I think it’s safe to say that over the sixty years of our history here in the United States, all of the transit agencies, as well as all of the Class I railroads have been Plasser American customers.
That sounds impressive, and it brings me to my next question: Who is your competition here in the United States?
It depends. Plasser & Theurer, and Plasser American, respectively, are the only full-range provider of train track maintenance equipment. But there is competition in certain product segments. We offer the full line up for what is needed to build and to maintain tracks. But within each individual product segment we offer, there exists competition.
Let’s talk a bit about the company’s history here. You brought the first machine to the United States already back in 1957. What prompted Plasser & Theurer in Austria to enter the U.S. market in the 1950s?
It was a very progressive approach at that time. The technology that we developed in those days was very unique in that market and very technologically advanced. It was really breakthrough technology that we provided. And this of course was also of specific interest to the U.S. railroads as well. This is the reason why we exported the first tamping machine to the United States in 1957.
When did you begin to build machinery here in the United States?
This has developed over time. The first machine that we brought over in 1957 was a very simple machine compared to the current ones. In 1961—we celebrated our sixty year anniversary here in 2021—we founded the Plasser Railway Maintenance Company in the U.S., which was re-branded as Plasser American in 1967. That company was founded in Rockford, Illinois, and in 1970 we relocated to Chesapeake, Virginia. And I would say we started building machines here in the United States during late 1960s.
You mentioned that you moved from Illinois to the current headquarters in Chesapeake, Virginia in 1970. Why?
There are two main reasons: The first one is the climate, because our machines undergo extensive testing before we ship them to our customers. The tamping machines, for example, cannot be tested on frozen ground, in frozen ballast—we were unable to test our machines there during the winter time. The mild climate here in Southern Virginia, on the other hand, was very beneficial for us because we can test our machines year-round. This is essential in order to provide high quality equipment that has been tested before we ship it to our customers. The second important reason was the close proximity to the seaport. We import certain core technologies from Austria, and during winter it was very difficult to get them to Rockford, Illinois. Most of this cargo arrives in containers, on cargo ships, and getting those goods to Rockford was often difficult during winter. In comparison, the close proximity to the seaport in Norfolk was a big reason for our move.
The moment it happened: ribbon cutting for Plasser American’s new headquarters in Chesapeake, VA, December 2021.
From left: Thomas Blechinger, President & CEO of Plasser American; The Honorable Rick West, Mayor of Chesapeake; The Honorable Ralph Northam, Governor of Virginia; Johannes Max Theuer, CEO of Plasser & Theurer; Martin Weiss, Austrian Ambassador to the United States; Virginia State Senator Lionell Spruill; Virginia State Delegate Cliff Hayes.
Photo: Abtin Sanati/ Plasser American
The company has been growing ever since. You just opened up a new, expanded headquarters building, creating some one hundred new jobs. This brings me to the issue of recruitment of skilled labor.
To illustrate the growth pace we have enjoyed since the foundation of the company, I would like to share some numbers to highlight the growth trajectory: During the first ten years here in the U.S., we built and delivered 115 machines. Over the next ten years, we delivered 800 machines. And as of today, we have delivered 2,500 machines with 1,800 of those built here in the United States. We are very proud of it. Labor is always an issue when it comes to manufacturing all those machines. The white collar jobs are usually pretty easy to recruit. Engineering, accounting, human resources, or sales—for these kinds of positions we can usually find people rather easily and fill our vacancies. Blue collar manufacturing and production jobs, however, have been difficult to fill in the past, and more recently, because of the COVID-19 pandemic, it has become very, very difficult. I am sure you heard the term “great resignation.” There is currently a lot of movement in manufacturing jobs, so right now it is very difficult to recruit the open positions we have. To illustrate, as of today, we have about 50+ open positions in production that we would like to fill.
Do you do a lot of in-house training after you have hired skilled labor in the manufacturing process?
Yes. Most of the new hires do need to learn the specifics of our unique products and we need to train them in-house. We have implemented apprenticeship programs together with community colleges, and all our apprenticeship programs are fully certified with the Department of Labor. So this is a step we are taking towards having more qualified labor and a larger pool of skilled in-house personnel in order to grow.
You implemented your own dual education program.
Yes, with the current growth trajectory we will create one hundred new jobs over the next three years. In total we will need to fill approximately 130 positions over the next two to three years. It will be a challenge to recruit for all those positions.
A much anticipated moment: the machine frame and the work units are joined in “marriage.”
Photo: Plasser & Theurer
Let’s talk about rail in the United States in general. Could you explain the importance of freight rail versus passenger rail in the U.S.?
Absolutely. Most of the goods that we see here in the United States on a daily basis, anything from furniture to the Christmas toys, are transported by rail. And this is why the freight railroads in particular are called the nation’s backbone; they are a huge industry in the United States. Since the Staggers Act of 1980, approximately 740 billion U.S. dollars of private investments have been made in the rail network, which today includes some 140,000 miles of track. The North American railway network is the largest connected network in the world. In the United States, it has supported some 1.1 million jobs since the 1980s. This has been generating approximately 220 billion dollars in economic activity and 26 billion dollars in tax revenue over the past forty years. This underlines how important the freight railroads are here in the United States. Compared to Europe, the infrastructure here represents a very different approach. In Europe, everything is very much engineering-driven, and it is also mixed traffic—that means freight and passenger rail share the same infrastructure. In the United States, on the other hand, it is financially-driven, and if you take a look at some of the financial statements of the large Class I railroad companies you’ll see that they are highly profitable—and by that I mean really high double-digit profit margins. The rail network here in the U.S. is a completely different approach compared to what you see in Europe. And in my personal opinion, it is the most efficient freight railroad in the world.
We recently heard about driver shortages in the trucking industry and how that might contribute to some bottlenecks in the supply chain. Is the rail network affected by similar problems?
Not to my knowledge. I have not heard about any shortage of locomotive engineers or railroad personnel. The system is running and it is running well, so you don’t hear much about it.
Let’s talk a bit about passenger rail in the United States. Visitors from Europe often find it lacking in destinations and connections—why is that?
That’s a good question. This is my personal view on this issue; I am sure many papers have been written, analyzing the differences between passenger rail in Europe and the United States. One of the big differences I would consider is the existence of a very established, dense air travel infrastructure in the United States. It is of course easier to add a few planes to new destinations compared to building a rail line, and going by plane is still the most frequently used mode of transportation by passengers here in the United States. One of the biggest issues facing the expansion of passenger rail here is the need for long-term capital investment. And there is a certain tipping point: passenger rail up to a certain distance makes a lot of sense, and we have lot of opportunities for growth here in the United States, but at the same time, considering the size of the country, it will be difficult to build rail lines comparable in density to what we see in Europe. Building new coast-to-coast and similar long-distance lines will be quite challenging.
But I think as far as commuter rail and inter-city transportation are concerned, we will see a lot of investment in the near future here. This is definitely a strong growth area in the United States. As far as Amtrak is concerned, their most profitable route is the Northeast corridor connecting Washington, DC to New York City and Boston. We are also seeing an expansion of the Amtrak network under the current administration; they are reopening lines down to the Gulf of Mexico, for example. So we will see more Amtrak lines, but in terms of very long-distance lines like coast-to-coast connections, we have a long way to go compared to the density we have in Europe.
President Biden has recently signed a new infrastructure bill into law. Do you see prospects there for rail in the United States in general, and subsequently also for your company?
I can only talk about the portions of the bill affecting rail—what we will see is 66 billion dollars funding the railroads themselves, to bring them back into a good state of repair, for modernization, and also for improved track safety. In addition, another 49 billion dollars are earmarked for public transportation. This also includes buses, coaches, and bridges, for example, but a portion of these funds will go to improving safety and to modernize public transport infrastructure, including rail. And of course it is fair to say that we are very much looking forward to upcoming projects and projects that are on the horizon. We aim to provide value to our customers and make a contribution to the railway system.
A Union Pacific freight train near Lake Point, Utah.
Photo: Union Pacific
There has also been some recent private investment in inter-city passenger rail, for example Brightline in Florida connecting Miami to West Palm Beach, and soon also to Orlando.
Yes, Brightline in Florida is one of those examples; in addition there is also Brightline West—the idea is to connect Las Vegas with Los Angeles. Another very promising project is Texas Central, also a privately funded project that has been in the works for a few years now. It aims to bring the Japanese Shinkansen train to Texas to connect Houston and Dallas with a real high speed line, using Japanese bullet train technology.
So what is on the horizon for Plasser American?
On the short-term horizon is our current investment in the expansion project at our headquarters in Chesapeake. We are investing approximately 52 million dollars in Chesapeake right now; we’ll get a new office building, which will be brighter, and a more pleasant and collaborative work environment—a place where people like to go to work.
At the same time, we are also expanding our manufacturing capabilities; we are doubling those capabilities to be precise. We expect to have that completed in 2023 and to be fully operational in 2024, when we will double the production output. That is the more immediate outlook. On the strategic horizon, we will focus on our two core strengths for expansion: the width of our service portfolio, and the in-depth knowledge of the market and the technology: those two key strengths will help us to further expand and to provide value to the railway system and to our customers.
So, in conclusion, is it fair to say that if you board a train anywhere in the United States, Plasser American is involved in your ride?
There is a very high probability that you will either see Plasser American equipment, or that you are riding on a section of track that was built or maintained by Plasser American equipment.
Mr. Blechinger, thank you very much for your time.
My pleasure.
Thomas Blechinger is the Chief Executive Officer of Plasser American.
To learn more, visit
www.plasseramerican.com