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What are private railroad cars worth?

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What are private railroad cars worth?
Posted by 54light15 on Thursday, March 18, 2021 1:54 PM

My boss in the car appraisal business asks me to find out what something like this is worth for insurance purposes. I've appraised cars and trucks but never a train car. Any ideas out there? any advice would be appreciated. 

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Posted by Overmod on Thursday, March 18, 2021 2:33 PM

Lots of discussion of this topic over the years on RyPN.  People who can advise you well or mentor you over there, too.

Much of the answer depends materially on who's interested in the answer.  Replacement value is usually colossally higher than the car would 'fetch' in a sale or purchase -- and these things tend to weather and wear dramatically and rapidly unless stored and maintained very carefully.

In addition, a great many of these are what in classic-car circles is sometimes euphemistically called "older restorations" -- not the sort of thing most people would tolerate if they had the accommodation in a hotel, for example.  Allowances might have to be made for the amount of make-ready or repair to get the car 'fit' for a particular service.  (That used to be referenced against what Amtrak required, but even before the ban on PVs, the necessary cost for high-speed, HEP compatibility and the like made Amtrak compliance very expensive... that added tens of thousands to the expected asking price of the car, but balanced against that was that much of the work would have to be done and inspected over again before the car could actually be worked in an Amtrak train...)

Aside from that, much of the actual value involves the 'greater fool theory'.  This is unfortunately not like the counterpart in general insurance, where some objective replacement value can be market-determined.  A logical thing you might do is to consult one of the used-railcar companies like Ozark and have them provide you a historical list of comparables that actually sold.  (Rather than current asking prices for the comps they have on hand Whistling)  That would get you into the range, with appropriate adjustment for greater or fewer amenities or differences in condition.

Part of the valuation involves what may be needed to move the car if it is to be sold, even for scrap.  At one point I could buy the shell of one of the NYC stainless-steel observation cars for $14,000 ... if I could move it on my nickel.  That would have added considerably to the bill.

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Posted by BaltACD on Thursday, March 18, 2021 2:34 PM

Car only or car and furnishings?

Actual replacement value or depreciated value?

Insurer's value or owners value?

The questions go on and on.  Start at mid six figures and progress toward eight figures.

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Posted by gmpullman on Thursday, March 18, 2021 3:30 PM

54light15
I've appraised cars and trucks but never a train car. Any ideas out there?

You might want to contact one of the private rail car owners' associations:

https://www.aaprco.com/

Or:

https://www.rpca.com/

This is one of the larger dealers of private cars and railroad equipment. They offer an appraisal service:

https://ozarkmountainrailcar.com/appraisal-services.php

 

Someone there may be able to guide you. Good Luck,

Ed

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Posted by MMLDelete on Thursday, March 18, 2021 9:55 PM

If you have to ask, you can't afford it.

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Posted by 54light15 on Thursday, March 18, 2021 10:24 PM

OK there, J.P. Morgan but I'm asking for a friend. Stick out tongue

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Posted by SD70Dude on Thursday, March 18, 2021 10:33 PM

As was mentioned, Ozark Mountain is probably the best place to go.  Even without engaging their services the classified listings provide a window into what folks seem to think their cars are worth. 

Here's one that is a pretty close match for "Pacific", an Amtrak-certified heavyweight Pullman business car originally built for Santa Fe.  The seller wants $410,000 USD for it:

https://ozarkmountainrailcar.com/railEquipment.php?itemId=2957&category=Passenger%20Equipment

You need to create an account to view the full listing, but it is free to do so.

Greetings from Alberta

-an Articulate Malcontent

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Posted by MMLDelete on Friday, March 19, 2021 12:19 AM

54light15

OK there, J.P. Morgan but I'm asking for a friend. Stick out tongue

 

Big Smile Big Smile Big Smile

Good one!! 

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Posted by 54light15 on Friday, March 19, 2021 11:47 PM

Thanks for the links, guys- I have forwarded them on to my appraisal boss and he will make of them what he will. 

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