32 Trains JANUARY 2017

The history is not lost on the Cathcarts, who aim to return name recognition to this city.

“I’ve always had an entre-preneurial spirit, and with my infrastructure finance background, I saw the op-

portunities within the freight rail space,” Casey says. “So I launched Cathcart Rail Holdings in June 2015 and immediately began network-ing with rail and financial professionals to uncover po-tential investments.”

The initial search did not take long.

A brokerage house was representing the Bucyrus car-repair facility for Trans-co Railway Products Inc. and all the parties connect-ed in July 2015. Casey im-

mediately saw potential there and arranged a site visit for mid-August. The size of the property, access to two railroads, the amount of workspace within the shop, and its capacity and capabilities intrigued him.

READING, WRITING, AND RAILCARSLIMA LOCOMOTIVES. Galion graders. Marion and Bucyrus shovels. Ohio’s cit-ies have an indelible connec-tion with the industrial prod-ucts that bore their names. While the industries and products have largely faded

from the national conscious-ness, one of the cities is getting a second chance at a direct connection with heavy industry, thanks to the Cathcart family and Bucyrus Railcar Repair.

Casey Cathcart and his

father Thomas lead their start-up as the newest play-er in the railcar repair arena.

The city of Bucyrus, home to about 12,000 peo-ple, is the seat of Crawford County in northern central Ohio. The city’s association

with industrial goods began with the Bucyrus Foundry & Manufacturing Co. in 1880. The manufacturer found a new home in South Milwau-kee, Wis., in 1893. In 2011, Caterpillar acquired the company.

Story and photos by Brian Schmidt

Bucyrus Railcar Repair focuses on speed of service, keeping the yard tracks shown here in constant turnover. Michael D. Harding

The Cathcarts grew up with trains — now they run a carshop

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34 Trains JANUARY 2017 www.TrainsMag.com 35

has a rich history with the Pennsy, the Cathcarts’ facility is actually in a former New York Central carshop — part of the railroad’s Toledo & Ohio Cen-tral subsidiary, to be exact. The first shop building went up in 1864 for predecessor Atlantic & Lake Erie Railway Co., which evolved into the T&OC by 1885. By 1969, New York Cen-tral was operating the shop jointly with Cobey Co., a divi-sion of Harsco Corp. Transco acquired the Bucyrus complex in 1981, and used the office as its corporate headquarters until moving to Chicago in 2005.

The first day after acquisi-tion, the Cathcarts only had a stack of applications, with Casey, Thomas, sister Ashley, and two temporary employees to launch the business. Casey says, “We spent that first week-end and subsequent week going through everything we had pur-chased, formalizing our opera-tional strategy, some assessment of the railcars on site, and just generally cleaning and gutting the office and facilities.”

FAMILY CONNECTIONSRailroading has run

through the Cathcart family for generations.

Thomas says that his father worked for and retired from the Rock Island; his grandfather worked for the Wabash and passed away while still em-ployed by the Rock Island; and his great-grandfather worked for the Wabash.

“When I graduated from high school,” he says, “there were no openings with the Rock Island at the time, so I en-rolled at Missouri Western State University and was just completing my second semes-ter when I went to work for the Rock Island in St. Joseph, Mo.”

Since then, Thomas Cath-cart’s nearly 40 years of railroad experience has included the Kansas City Joint Agency, Nor-folk Southern, Wabtec, Millen-nium Rail, GATX Corp., and Harbor Rail Services, where he most recently served as vice president of safety, quality, and continuous improvement.

“I completed my Associate’s Degree in business and re-

ceived a BA in Business and Marketing while working for the Joint Agency in Kansas City,” he says, “and then re-ceived my MBA during my time with Norfolk Southern.”

Casey’s siblings and mother have come to work for the company, too. Sister Ashley handles payroll and per-sonnel matters, brother Brad manages the Bucyrus Railcar Services division, and mother Susan is con-troller and purchasing and payables manager.

“We have a weekly meet-ing where we discuss each of our areas and what is happen-ing. We can each give our input or suggestions,” Susan says. “We all bring something to the ta-ble.”

“We all took different ca-reer paths after college,” Ash-ley adds, “but now that we’ve linked up, it’s amazing to see how our varied experiences al-low each of us to contribute to the company in unique ways.”

The lifelong affiliation with railroading has also influenced their family life. “Beginning with Kansas City and St. Louis, to Georgia and Texas, there is not a single place I have lived that was not related in some way to the rail industry,” Brad says. “Because of this, you could truly say that our affiliation with rail-roads has been the root of ev-erything else in our lives. The friendships and experiences I’ve had over the years would never have occurred without the railroad tracks always guid-ing our next move.”

Ashley concurs: “Railroads were a big part of my child-hood. Most family vacations and activities revolved around trains. I’ve been told I learned to walk on a passenger train from Chicago to New York. But my favorite memory is learning to run a train on the Norfolk Southern simulator at a company picnic.”

MAKING IT WORKDrumming up new business

is a challenge for a start-up in any industry, and it’s no differ-ent for railcar repair shops. Bucyrus Railcar Repair finds business by reaching out to fleet

owners, managers, and custom-ers to arrange meetings or site visits, discuss shop capabilities, or provide other information.

They are registered in Rail-inc, the Association of Ameri-can Railroads’ for-profit car reg-

istration service, but it still takes a little research to find shops, Thomas says. Bucyrus Railcar is also listed with RAS Data and AllTranstek, private services that, combined, manage just fewer than a million cars.

BUYING A SHOP“As a former

investment banker,” Casey says, “I picked apart the financials, used some insight from my father regard-ing his expertise — operations, and put together a comprehen-sive lender’s presentation. In my mind, the opportunity and its potential spoke for itself.”

With a possible location identified, Casey turned to his father for help.

“When Casey sent me the proposal for the Bucyrus facili-ty, I immediately liked the size of the flow layout of the shop and yard,” Thomas says. “From the first visit, we felt the facility, the city of Bucyrus, and the state of Ohio offered the head-quarters needed to launch a successful business.

“With dual switching avail-able from two major railroads, adequate repair spaces, and full blast and paint, this facility of-fered the unique location, and opportunity to provide car owners the combination of rep-utation and perfect location to

send a bad-order railcar.”

Casey submit-ted an offer for the

property, which had been on the market for

more than two years, in mid-September. Surprisingly, he was outbid.

The competing bidder never closed on the property, though, and a few weeks later the Cath-carts were again in the running for the Ohio facility.

Others, however, did not share Casey’s optimistic view. “Shopping this deal to commer-cial banks proved to be ex-tremely challenging,” he says.

By chance, Casey met a gen-tleman associated with Phoenix Commercial Finance, while eat-ing dinner in New Haven, Ind. Casey was passing through town one night in December 2015 on his way to Bucyrus for the environmental, mechanical, and property inspections. That encounter led him to Phoenix Commercial, and ultimately to Celtic Bank out of Salt Lake City. “The bankers asked chal-lenging questions,” Casey says,

“but understood what we were trying to achieve. Their under-writer and I spent quite a few hours together going over every detail of the acquisition.

“We finally closed on the ac-quisition Feb. 25, 2016, celebrat-ed for maybe 5 minutes, and then got to work.”

What the Cathcarts bought was a 33-acre facility with more than 2.5 miles of track, and 28 indoor car spots. Outdoor stor-age and staging facilities ac-

commodated 125 railcars, and off-site staging added another 50. Capacity has since increased to more than 200 on site, with further expansion anticipated.

The shop is located east of downtown Bucyrus, just south of the junction of Norfolk Southern’s Columbus-San-dusky main line and the Chi-cago, Fort Wayne & Eastern’s former Pennsylvania Railroad main line.

While the city of Bucyrus

The Cathcart family: left to right, Susan, Ashley, Gena, Casey, Thomas, and Brad in front of the Bucyrus shop complex.

YARD

PAINT SHOPBLASTING

HEAVY REPAIR BAYS

MATERIALS AND MAINTENANCELIGHT REPAIR BAYS FREIGHT CAR REPAIR PARTS

AND LABOR TIMES

BUCYRUS RAILCAR REPAIR — FROM THE AIR

Bucyrus

Columbus

O H I O

1. SUPPORT POSTS — 4 HOURSExterior items are prone to damage on the main line and at customers’ facilities.

2. HOPPER GATES — 2.5 HOURSAs moving parts, hopper gates see abuse by customers — especially when they don’t budge!

3. BRAKESHOES — 8 MINUTESA wear item, missing or worn brakeshoes are a common freight car repair.

4. BRAKE HOUSING — 30 MINUTESEmployees interact with hand brakes regularly and maintaining them is a major safety item.

Michael D. Harding

© 2016 Trains magazine. This material may not be reproduced in any form without permission from the publisher. www.TrainsMag.com

JUST THE FACTS: FREIGHT CAR REPAIR 101THE PREMISE IS QUITE SIMPLE: The North American railcar fleet rolls millions of collective miles in a year, and all that productivity comes at a price.

Freight cars break. In the 24/7 world of railroading, repairs are needed fast — especially if a car is already loaded.

Once a freight car is flagged for work, often by a railroad’s car inspector, the process begins. Light, or “running,” repairs are typically performed by the railroad or an on-site contractor. A car’s documentation includes instructions for heavier repairs that will take it out of service for longer periods.

Once at the shop, inspectors will work up an estimate and send it to the car’s owner or lessee. After estimates are approved and materials are secured, the work begins and a re-inspection is performed. Once cleared, the car is sent back out for another load. The process can take anywhere from weeks to months.

Common fixes include running boards; hopper hatches and gates; wheels and bearings; couplers; bolsters; trucks; and safety appliances, such as air hoses, air hose supports, ladders, grab irons, and brakeshoes. Some are considered wear items, which need periodic changing, while others suffer abuse at the hands of impatient or uninformed rail customers.

Repair costs are split by agreement, based on the type of repair and cause of the defect. For example, brakeshoes will wear throughout a car’s life and are typically the responsibility of the party leasing the car. Rough handling or a derailment would place repairs on the rail carrier.

The contract railcar repair industry is dominated by a few large players: Progress Rail, a subsidiary of Caterpillar; American Railcar Industries; Transco Rail Products; and GBW Railcar Services, a joint venture of Greenbrier and Watco. However, a number of independent shops, like Bucyrus Railcar Repair, also serve the needs of the railroads and other car owners. — Brian Schmidt

36 Trains JANUARY 2017 www.TrainsMag.com 37

creative” with recruiting nation-ally, Casey says. “We would wel-come interested candidates to reach out to us.”

Safety is always a concern at Bucyrus, where issues are ad-dressed daily, rather than at monthly committee meetings.

CUSTOMER FOCUSRailcar repairs take a sur-

prising amount of time to someone outside the industry. Once a shop receives a car, in-spectors note existing and po-tential defects, and then draft a work estimate for the owner and/or lessee. Then the shop waits for the responsible party to approve or modify the esti-mate before work begins.

“We look at our business from the car owners’ side and try to provide them with the best car shopping experience available,” Thomas says. “This translates into a consistency that our customers can come to expect, with their railcar com-pleting when they need it to ship back out.”

Peter Urban knows railcars. A principal of Ralco Leasing, he has 44 years in the rail industry and that experience has led him to Bucyrus Railcar Repair.

“I give them pretty strong marks,” he says of Bucyrus Railcar Repair. “Their estimates are pretty good and they have a good understanding of what we need.” Urban credits this to a “healthy flow of information” from Bucyrus.

Ralco’s 400-car fleet in-cludes many types of cars: covered hoppers, boxcars, mechanical reefers, tank cars, flatcars, and gondolas.

“We make sure the car’s components still meet safety standards and does what it’s needed to do, many times skip-ping aesthetic repairs that would do nothing more than

generate revenue purely for us,” Casey says.

Like all railcar repair facili-ties, Bucyrus keeps the most common parts on hand. How-ever, Casey says, customers have requested the use of cer-tain replacement parts, usually for high-value items.

“You learn from customer requests and try to better serve their needs in the future,” he says. Some special requests have even turned into regular stock items employees weren’t aware of.

Bucyrus employees break down processes into daily pro-duction goals in order to focus the same amount of energy on each stage of the repair process: from initial inspection, to the estimate, customer approval, ordering material, repairing the railcar, painting it, and final quality inspection.

One process point they are particularly proud of is a white board in the office lobby that shows the status of each freight car on the property. It shows the number of cars in each stage of work: inspection, data entry, ap-

proval, material staging, repair, painting, and quality assurance.

“Having all this up front and center enables everyone to be on the same page on a daily ba-sis,” Casey says. “Everybody sees it collectively — same with safety or quality.”

The goal is to move cars off the property in 21-28 days, Casey says. The industry aver-age is usually around 30 days, but sometimes up to 60 days, depending on the shop. With such fast turnarounds Bucyrus hopes to someday process as many as 100 cars a month.

If their early success contin-ues, the Cathcarts can bring the Bucyrus name back to Ameri-ca’s industrial forefront. Casey is actively looking for shops in other regions to acquire.

“We’re on the hunt for short-line railroads, railcar fleets, and switching operations — just about any kind of rail or me-chanical operations,” Casey says.

If that pans out, it may someday be possible to see the Bucyrus name associated with the nation’s industrial base once again. 2

“Car owners and fleet man-agers discuss amongst them-selves, and they recommend to each other shops that are per-forming well,” Thomas says.

Often, however, motivated self-promotion is the best tac-tic. Bucyrus Railcar Repair sends a weekly shop capacity email to its customers to keep them updated on the shop’s ability to accept new business, or other shop- and industry-re-lated news.

“In simplest terms, good old-fashioned networking,” Casey says. “Since opening, we’ve probably reached out to a couple hundred potential cus-tomers with great success.”

Bucyrus focuses on the re-pair of all general-service freight cars: hoppers, gondolas, boxcars, and auto racks. Recently, it’s fo-cused on covered hoppers —straightening running boards, new side sheets, replacing hatch covers, making sure gates are operating, and making basic re-pairs such as brakeshoes, air brakes, couplers, knuckles, bol-sters, and wheels.

Casey notes, the shop aims to keep cars in service, not pretty. “We have a deep under-standing of the owner’s inten-tions for the car as well as the service it is in,” he says. “We only perform the repairs that keep the car in full utilization. We would rather focus on vol-ume of car throughput, not hammering a single car for ev-erything we can.”

In addition to hoppers, the company recently refurbished a dozen boxcars that needed full repair and a new coat of paint. It is also fully certified to work on auto racks and perform re-certification work on them.

The company has launched a second repair site in nearby Marion, Ohio. That location performs running repairs for the Marion Intermodal Center and industrial park located along the CSX Transportation Cleveland-Indianapolis main line east of town. The work in-cludes readying a daily inter-modal train that departs Mari-on for a Kansas City Southern connection in St. Louis.

“We have had excellent suc-cess with the Marion business,

which has been a surprise part of the transaction,” Thomas says, “and we’ve enjoyed a good relationship with the owners and managers of the facility. In our Bucyrus Railcar Services division, which includes Mari-on, revenue has increased 10 times, and we’ve been added as a running repair agent at a doz-en sites based off this part of the purchase.”

Bucyrus Railcar Services, which is the mobile railcar re-pair arm of the organization, is now operating as running re-pair agent throughout Ohio on behalf of CSX; with more loca-tions, states, and railroads to come, Casey says. The compa-ny serves customers directly, whether they are grain eleva-tors, industrial operations or interchange points, with mo-bile crews fully blanketing the service area.

The expansion requires people. During the first few weeks, the company hired six lead people for its different sta-tions — inspection, repair, blast and paint, and quality, for example — as well as its busi-ness coordinator, Michelle Wood. From there, the Cath-carts began interviewing and hiring crew with significant in-put from their lead workers. They hired eight former Trans-co Bucyrus employees and about a dozen off the street, for a total of 20 employees by May 2016. Hiring has continued throughout the year, and the company now has just fewer than 50 employees, after a suc-cessful on-site job fair in Octo-ber 2016.

“Once our various running repair units are fully function-ing, we should have about 75 total employees across Ohio and other states,” Casey says.

“Finding unskilled employ-ees has not proven difficult,” he adds. “However, finding skilled welders, experienced inspectors, and various office employees has been a challenge. We are partnering with an area welding school to set up a program to train students to the certifica-tion level we need.”

For other positions, such as inspectors, they will either have to train them in-house, or “get

This simple white board is a point of pride for Bucyrus Railcar Repair; it helps track cars’ progress through the repair process, and improves the shop’s efficiency and customer communication.

A general service gondola rests in the running repair bay at Bucyrus. Gondolas are among the most abused cars in the industry, moving heavy and bulky loads throughout the network. The Bucyrus shop complex has served the railroad industry since 1864, beginning with a New York Central predecessor.

Norfolk Southern lead carman Lloyd Armentrout guides the lift on an in-shop jack system as a truck is replaced on a gondola at Luther Yard near St. Louis, Mo. Steve Smedley

COUPLER & AIR HOSE

ROLLER BEARINGSTRUCK BOLSTER

AXLE & WHEELS

GRAB IRONS & LADDER

BRAKE WHEEL