特里尼蒂工业 (TRN) 2026财年第三季度业绩电话会：铁路货车订单增加，维持每股收益指引

Trinity Industries（纽约证券交易所代码：TRN）2026财年第三季度业绩说明会强调，铁路车厢需求不断改善，制造出货量走强，租赁业务持续强势。管理层维持了全年每股收益（EPS）指引，同时调高了二级市场铁路车厢出售的预期收益。

核心要点

• 第三季度营收同比增长18%，主要受外部铁路车厢交付量增加以及外部维修保养业务占比提升驱动。
• 营业利润下降19%至9600万美元，反映出租赁资产组合出售收益减少、销售及管理费用（SG&A）增加以及部分持股租赁车队的贡献下降。
• 铁路产品部门交付了2,030辆车厢，环比增长29%；新签订单达2,190辆，出货订单比（book-to-bill）保持在1倍以上。
• 租赁车队利用率为97%，续租成功率为89%，续租费率较到期费率高出4.1%。
• Trinity维持全年每股收益（EPS）指引在2.20美元至2.40美元不变，并将二级市场车厢出售收益预期上调至1.8亿至2亿美元。
• 管理层预计2026年将是行业交付量的周期性低谷，根据当前行业数据，预计全年产量略高于23,000辆车厢。

核心财务数据

业务与运营表现

租赁与服务

核心租赁营收同比下降，原因是在Napier Park合伙交易后Trinity的合并报表车队规模缩小。租金上涨、管理费增加以及近期车队投资抵消了部分降幅。

车队利用率保持在97%，到期租约的续租率为89%。续租定价较到期费率高出4.1%。“未来租金差价”（Future Lease Rate Differential）基本持平，原因是Trinity已将其大部分车队租金重新定价至较高利率环境，且本季度的续租组合优势较弱。

该部门的营业利润率为34.2%。管理层将结构性压力归因于利润率较低的维修保养服务活动增长较快。Trinity还计划将其位于琼斯伯勒（Jonesboro）的维修厂转型为仓储及移动维修站点，预计维修业务量将由其余四个工厂支撑。

10月，Trinity收购了Rubber Lining Specialists, LLC的资产。该交易提升了其对衬胶铁路罐车的检验、维修及防护能力。管理层表示，目前全北美约有11,000辆此类罐车在营，并称该收购不构成重大影响。

铁路产品

铁路产品交付量环比增长29%至2,030辆。订单总计2,190辆，使出货订单比保持在1倍以上；同时公司完成了355辆车厢的改装。

该部门公布的利润率为9%，其中包括出售朗维尤（Longview）工厂部分资产获得的1340万美元收益。扣除该收益后，利润率为5.1%，较第二季度大幅提升。由于该业务具备运营杠杆效应，管理层继续预计随着产量增长，利润率将进一步走强。

Trinity正在将其位于朗维尤的两处厂区整合为一个现代化的罐车生产基地。管理层预计该项目将提升效率、生产力及产能，同时引入自动化设备。

铁路车厢市场状况

管理层表示，车厢铁路装载量同比增长3%，而闲置封存车厢比例降至18%，为2023年5月以来的最低水平。10月标志着北美铁路车厢总量连续第17个月萎缩。

Trinity预计2026年将有约40,000辆车厢报废，相比之下，行业预计交付量仅略多于23,000辆。趋势订单率环比增长40%，需求广泛来自于铁路公司、出租商和发货商。农业和化学品被列为最强劲的终端市场。

管理层指引

每股收益展望包含了因出售朗维尤工厂资产获得1340万美元收益而带来的约每股0.12美元益处。管理层表示，该出售事项早已包含在年初发布的指引中。

Trinity未提供正式的2027财年指引。管理层给出了对2027年行业交付量的初步预测，为30,000至35,000辆车厢，相较于预测为周期低点的2026年有所回升。

风险与关注事项

• 热轧卷板和中厚板钢材价格同比增长63%，同时钢厂交货周期增加了一倍，交付延迟了二至四周。
• 钢材成本和利率抬升推高了新罐车的成本，并导致客户推迟决策。
• Trinity正在等待美国海关和边境保护局就《232条款》关税作出澄清，并表示目前未支付该关税。
• 管理层认为，在当前框架下，使用至少85%美国熔炼和浇筑钢材的罐车可能面临10%的关税，而比例低于85%时关税为25%。Trinity正在将10%的税率标准纳入新罐车订单的谈判中。
• Union Tank Car对从墨西哥进口的铁路罐车提出了反倾销和反补贴税申请。Trinity对此指控表示异议，并预计该流程可能要到2027年底才会最终敲定。
• 管理层表示，关税和贸易政策的不确定性推迟了部分罐车采购决策，尽管现有的积压订单尚未被推迟或变更。

分析师问答亮点

管理层将更高的二级市场收益展望归因于铁路车厢资产价值的持续强势以及显而易见的交易活跃度。尽管利率上升，Trinity并未看到二级市场估值出现相应下降，这表明买方正将未来更高的租赁费率纳入承销评估。

在租赁定价方面，管理层表示，“未来租金差价”持平反映的是与此前已在较高水平上重新定价的租赁合约进行的对比，而非基本面走弱。高利用率、改善的铁路货运量、车队规模收缩以及重置成本上升，继续支撑管理层对未来租金费率逐步走高的预期。

针对需求方面，管理层指出，近期订单的增加广泛来自于铁路公司、租赁公司以及终端发货商。目前货车需求强于罐车需求，部分原因是关税及相关贸易不确定性对罐车采购决策造成了更大拖累。

业绩说明会全文转录

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完整财报电话会议逐字稿

管理层陈述

Operator

Good day, and welcome to the Trinity Industries Third Quarter Ended September 30, 2026 Results Conference Call. [Operator Instructions] Please note that today's event is being recorded. Before we get started, let me remind you that today's conference call contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995 and include statements as to estimates, expectations, intentions and predictions of future financial performance.

Statements that are not historical facts are forward-looking. Participants are directed to Trinity's Form 10-K and other SEC filings for a description of certain of the business issues and risks, a change in any of which could cause actual results or outcomes to differ materially from those expressed in forward-looking statements.

I would now like to turn the conference over to Ms. Leigh Anne Mann, Vice President of Investor Relations. Please go ahead.

Leigh Mann

Thank you, operator. Good morning, everyone. We appreciate you joining us for the company's third quarter 2026 financial results conference call. Our prepared remarks will include comments from Jean Savage, Trinity's Chief Executive Officer and President; and Eric Marchetto, the company's Chief Financial Officer.

We will hold a Q&A session following the prepared remarks from our leaders. During the call today, we will reference certain non-GAAP financial metrics. The reconciliations of the non-GAAP metrics to comparable GAAP measures are provided in the appendix of the quarterly investor slides, which are accessible on our Investor Relations website at www.trin.net.

These slides are under the Events and Presentations portion of the website, along with the third quarter earnings conference call event link. A replay of today's call will be available after 10:30 a.m. Eastern Time through midnight on November 5, 2026. Replay information is available under the Events and Presentations page on our Investor Relations website. It is now my pleasure to turn the call over to Jean.

E. Savage

Thank you, Leigh Anne Mann, and good morning, everyone. We delivered a solid third quarter with momentum building across the business, and Trinity is well positioned as we move toward year-end. Our leasing fundamentals remain strong. Our manufacturing volumes are improving, and our cash generation continues to support disciplined capital allocation.

Our last 12 months adjusted return on equity was 31.8%, helped by transaction gains and operational improvements. I'll start by walking you through what we're seeing in the market. Macro dynamics are very supportive of future growth in railcar orders. We have seen year-over-year carload volume increase by 3%, and this is across a variety of categories.

Scrap rates are also elevated, and the industry is on track to scrap approximately 40,000 railcars in 2026, well above expected new railcar production. Railcars in storage continued to decline and currently stand at 18%, the lowest reading since May 2023. This metric measures the share of railcars that have not made a revenue move in 60 days or more.

October also marked the 17th consecutive month of fleet contraction, a trend that continues across a wide variety of car types. Against that backdrop, it is encouraging to see demand firming, with trending order rates up 40% quarter-over-quarter and inquiries remaining strong. We see the market from both sides with customers order for new railcar deliveries and about 20,000 lease renewals and 5,000 railcar assignments each year.

That insight allows us to adjust rates as conditions evolve and continue to expand our spread over our cost of capital. I'll take you through both segments, starting with leasing and services.

Our leasing and services business performed well in the third quarter. Core leasing revenue was down year-over-year, reflecting a smaller consolidated fleet following the railcar partnership transactions we completed over the last year. The decrease was partially offset by higher rents, higher management fees and the fleet investment we have made over the last year.

Our lease fleet utilization was 97%, and our renewal success rate was 89%, with renewal rates 4.1% above expiring rates. The Future Lease Rate Differential or FLRD, was essentially flat this quarter, driven by higher expiring rates and a less favorable renewal mix, largely the result of having repriced nearly our entire fleet into a higher rate environment.

Lease rates have not yet kept pace with asset values and inflation. We are focused on maximizing the yield on our assets and the environment remains favorable for continued lease rate increases. Our Leasing and Services segment operating margin of 34.2% reflects a higher percentage of segment activity coming from lower-margin businesses, such as maintenance and services as those areas continue to grow.

Over the last few years, we have improved the performance of our maintenance network to navigate the increase in tank car compliance work. As this work moderates, we announced plans to repurpose our Jonesboro maintenance facility to a storage and mobile repair facility.

Current and expected volume can be efficiently supported across our remaining 4 facilities, which allows us to improve utilization across the network. Working with local and state resources, we are supporting our affected employees to help identify alternative opportunities. Net fleet investment in the quarter was $115 million, bringing our year-to-date total to $241 million.

The secondary market remains very active and strong, and we continue to participate as both a buyer and a seller. I also want to highlight a small acquisition we completed in October. We acquired the assets of Rubber Lining Specialists, LLC, an Orange, Texas-based provider of specialized rubber lining, corrosion and abrasion protection, inspection and repair services.

This acquisition expands our capabilities in supporting and servicing rubber-lined railcars. In Rail Products, we are encouraged by the momentum in the market. We increased deliveries by 29% sequentially and still recorded a book-to-bill above 1x with orders of 2,190 and deliveries of 2,030 in the quarter. We also completed 355 railcar conversions.

Higher steel prices should support more conversions in the future. Segment revenue reflects the higher delivery volumes. Segment margin in the quarter was 9%, which benefited from a gain on the sale of a portion of our Longview facility. Without the $13.4 million gain, segment margin would have been 5.1%, a significant step-up from the second quarter. We continue to expect a full year segment margin between 5% and 6%. This business benefits from significant operating leverage, and we would expect to see the margin improve as volumes rise.

As we discussed last quarter, we are undertaking a large project to modernize and consolidate our Longview tank car facility. This project is ongoing and progressing well. It reflects our strategic decision made a year ago to expand our U.S. manufacturing footprint, a decision we especially value given today's uncertain trade policy environment.

Before turning the call to Eric, I want to address the antidumping and countervailing duty petition filed by Union Tank Car, a wholly-owned subsidiary of Berkshire Hathaway Inc. with the U.S. Department of Commerce and the U.S. International Trade Commission, targeting imports of railway tank cars from Mexico.

Our Monclova, Mexico facility has been an integral part of our North American railcar manufacturing network since 1998, and Trinity has also produced more than 73,000 tank cars in the United States over the last 15 years. Our U.S. and Mexico facilities produce high-quality tank cars to meet our customers' needs. Trinity is a significant purchaser of American-made steel, which we ship to our facilities in Mexico for incorporation into the tank cars that Union Tank Car alleges to be dumped and subsidized.

Our facilities serve customer demand across North America as part of a fully integrated supply chain. We disagree with the petition's allegations and are vigorously defending our position, and we will fully cooperate with Commerce and ITC as they complete their review of the facts.

Let me leave you with 3 points. First, our cash generation has let us grow the fleet, invest in our U.S. manufacturing footprint and return capital to shareholders. Second, the market is tightening. Orders are up, scrapping is running well ahead of new deliveries, and we believe 2026 is a cyclical low for industry deliveries. Third, we are focused on delivering for our customers across North America. I want to take a moment to thank our team members for their hard work this quarter and for keeping customers first. Now I'll turn it over to Eric.

Eric Marchetto

Thank you, Jean, and good morning, everyone. Starting with the income statement. Revenues were up 18% year-over-year, driven by an increase in external deliveries and a higher mix of external repairs in our maintenance business, partially offset by the reduction in the size of our consolidated lease fleet following the Napier Park transactions. Operating profit was $96 million, down 19% from prior year. This was driven by lower gains on lease portfolio sales, higher SG&A expense and a reduction in operating profit contribution from the partially owned lease fleets as a result of the railcar partnership transactions.

These reductions were partially offset by a $13.4 million gain on the sale of a manufacturing facility in the Rail Products Group. Our tax rate in the third quarter was 29%, which is higher as a result of income taxes from our foreign operations and third quarter EPS was $0.27, benefited by higher external railcar deliveries and higher segment margin performance. Our last 12 months adjusted return on equity was 31.8%, above our target range. This metric benefited from the gains on the railcar partnership transactions, but it also reflects improving operational performance.

Moving to the cash flow statement. Cash generation remains strong with $243 million year-to-date. We continue to prioritize return of capital to our shareholders, and we paid our 250th consecutive dividend in the quarter. We were also opportunistic in the quarter, repurchasing 787,000 shares for $23 million.

Year-to-date, we have returned $119 million to shareholders through dividends and share repurchases. Net fleet investment in the third quarter was $115 million with $169 million of fleet additions, partially offset by proceeds of $54 million of leased railcar sales. We remained very active in the robust secondary market, both as a buyer and a seller. Year-to-date, net fleet investment totals $241 million. We expect to complete the year ahead of our 3-year target of $1.2 billion to $1.4 billion for cash generation, which includes cash from operations and gains on leased railcar sales.

With 1 quarter remaining in the planning period, we have generated $1.4 billion of cash from operations and gains on railcar sales. This significant cash generation demonstrates the capabilities of our platform in a low railcar demand environment and also gives us flexibility in our capital allocation decisions.

Turning to our balance sheet. Our loan-to-value on our wholly-owned fleet is 71.8%. We are comfortable at this level because the denominator is based on the net book value of our fleet, which is much lower than the market value of our fleet. This is supported by our current lease fleet financing activity.

In October, we closed a new $350 million TRL 2026 term loan. Net proceeds from the transaction were used to redeem the outstanding Series 2019-2 secured railcar equipment notes of Trinity Rail Leasing 2019 LLC and to repay borrowings under TILC's warehouse loan facility.

We are happy with the execution of this refinancing and continue to see support from capital markets in a rising rate environment. Jean mentioned the North American fleet is modestly contracting while rail traffic is growing across most car types, and this sets up an interesting dynamic for the future outlook of our business.

Railcars are long-lived assets that maintain their economic utility throughout the railcar life. Further than that, our fleet of 100,000 railcars with an average age of 15 years has similar utilities as a fleet of new railcars. In other words, railcars are long-lived assets with low obsolescence. Let me turn to lease rates. Since coming out of the COVID pandemic, we've repriced most of our fleet. As we move forward, we see an environment where there continues to be upward pressure on rail asset prices, mainly a result of higher input costs, namely steel. These asset prices, coupled with rising interest rates will continue to push up lease rates on new railcars. The combination of all these factors make us very bullish that lease rates will continue to increase from current rates.

Now I'd like to share our outlook and guidance for the remainder of the year. We expect the industry to deliver below 25,000 railcars in 2026. With 1 quarter remaining, the industry has delivered 16,000 railcars this year. We're not providing formal guidance for 2027. We expect 2026 to be the cyclical low point for industry deliveries. We expect to complete the year with net fleet investment in the range of $300 million to $350 million.

Notably, this quarter, we achieved our 3-year target for net lease fleet investment of $750 million to $1 billion, which we introduced at our 2024 Investor Day. We expect manufacturing capital expenditures in the range of $55 million to $65 million, unchanged from last quarter. And finally, we are holding our full year EPS guidance of $2.20 to $2.40.

We have seen opportunities in the secondary market and are increasing our secondary market railcar gains expectations for the year to a range of $180 million to $200 million, reflecting higher expected cash gains in the fourth quarter than we have seen this year. In the fourth quarter, we expect to see higher external deliveries to meet customer commitments.

To summarize, we generated strong cash flow, achieved our 3-year net fleet investment and cash flow targets and continued to strengthen our balance sheet. Our ability to execute in a slow new railcar market gives us conviction that this platform is built to deliver strong performance as the market recovers. Our capital allocation priorities are unchanged: disciplined fleet investment, active portfolio management and return of capital to shareholders. Operator, we are now ready for our first question.

Operator

[Operator Instructions] And today's first question will come from Andrzej Tomczyk with Goldman Sachs.

分析师问答

Andrzej Tomczyk

Just wanted to touch on the gain on sale to start within manufacturing. I think you said $13 million of EBIT and ex that gain, it was a 5.1% margin. I'm curious, one, just from an EPS perspective, is that roughly $0.12 of earnings? And would you back that out of your sort of $0.20 that you reported, just to clarify that. And then maybe just talk to the sale of that facility, what drove that? And if there are more sales to come in the future or if this is sort of more onetime-ish?

E. Savage

Sure, Andre. I'll start and then let Eric chime in on this one. When you look at Longview, we used to have 2 plants in the city that we were running. It wasn't efficient to move that product. We actually had to truck it across town to finish the operations.

So we decided last year that we were going to go ahead and consolidate it into one location. That would help us overall with efficiency, productivity and cost. And while we're doing that, we're also doing a lot of automation into that factory. So we're improving the overall process.

By doing that, that opened up that other facility. We call it Plant 200 in Longview and allowed us to sell that to a third party. We're not expecting to have that happen again for the Longview operation, but it is very beneficial for us. It allows us to have more flexibility and actually even increase the volume we could produce at Longview when this project completes. And I'll let Eric talk to you about the numbers.

Eric Marchetto

Yes. In terms of the numbers, Andre, yes, the $0.12 and then further, it is included in our EPS guide. We did not adjust that sale. We have had these sales from time to time. Our position is that it's fairly routine for us to sell these things. We call it out so that you can make your own determination on things. But we have a pretty high standard on what we use to adjust for any formal adjustments that we make to our GAAP earnings.

Andrzej Tomczyk

Understood. So it sounds like the $2.20 to $2.40 includes that $0.12.

Eric Marchetto

It does, yes, to be clear.

Andrzej Tomczyk

Okay. Cool. Got it. And then -- so I just -- you mentioned that the demand was firming with the order rates up 40% quarter-over-quarter. It sounds like a good sign. Could you just speak to the types of customers putting in these orders, whether that's more lessors or shippers? And then maybe any color on the types of cars being ordered in this environment as well would be helpful.

E. Savage

Sure, Andre. When you look at it, we are really happy to see inquiries remaining strong. When you look at the customers, it is railroads, it is lessors and it is the end shippers that are ordering. It is more prevalent, widespread in freight car orders and pretty broad-based on what we're seeing.

If you look at agriculture and chemical, those 2 remain the strongest areas that we're seeing it. A lot of it is still replacement demand. This year, we're talking about 40,000 cars being scrapped and less than 25,000 new cars being built. So market is staying very tight overall. In tank cars, we are seeing some tank cars but some of the headwinds we're seeing there, I don't know if you realize, steel prices have gone up 63% year-over-year in the hot-rolled coil and plate arena.

The steel mills are pushing out their lead times. They've doubled them, and they're missing those by still 2 to 4 weeks on delivery. So we're seeing a little bit of strain there. And I think that's across multiple industries from the steel side. But steel prices going up, the interest rates going up. And also when you look at the uncertainty around some of the tariffs, some of the tank car owners and those who would be putting the orders are still delaying some of those decisions.

Andrzej Tomczyk

Got it. And with your revised industry delivery forecast, I think you mentioned below 25,000 units. Any magnitude for sort of how far below 25,000? And then just what does that imply for Trinity's internal delivery pace here into the fourth quarter? And then maybe sort of thoughts on the run rate into 2027 to start would be appreciated as well.

E. Savage

Okay. So when you look at it, we just took ARCI numbers for the 3 quarters and projected out fourth quarter, and it came in just over 23,000 cars. So that's the number we're using there.

We expect to have higher deliveries for our units in the fourth quarter. And in the past, I've said 35,000 units for next year. Based off of the delivery rate and the order rates, I'm now saying between 30,000 and 35,000 cars, we believe we will deliver next year. So still up significantly from this year. And I think in our prepared remarks, you heard us say we're calling the cyclical low in '26.

Andrzej Tomczyk

Very helpful. I just wanted to touch on the tariff situation as well following the proclamation updates applying tariffs to the full customs value of imported tank cars and the components.

Could you just clarify whether Trinity is currently paying cash for the Section 232 tariffs on the railcars that originate from Mexico? And then maybe just the potential impacts there if you've looked into that? Or is it just the case that shipments are still progressing as normal under your pending ruling and sort of trying to get clarity with the CBP?

And then just following on to that on the commercial side, how receptive are shippers and leasing customers to tariff-related pass-throughs? Has anything like escalation clauses created any friction in signing new multiyear agreements? Anything like that color there would be super helpful.

E. Savage

Okay. First, we are not paying on the 232 currently. We do have clarification request. We're waiting for that from the CBP to see what happens. Remember, we bring cars under USMCA, and we qualify for the entry under that process. If you look at overall what could happen currently, I'm just going to talk about the current situation. I don't know if it will change.

Currently, if you use less than 85% melt and poured U.S. steel, the tariff would be 25% on the tank car. If you use 85% or more U.S. steel on the melt and poured, it would drop to 10% tariff. What we are doing currently is talking to customers. We believe we meet the 85% melt and poured. So it would be at the 10% level.

And as we talk or take new orders with tank cars, we're talking to the customers and building into the 10% tariff. But most of our contracts do allow for that tariff to be passed on if it wasn't in the contract. So that's where we sit overall. As far as what customers are doing, overall, we're still getting orders for tank cars.

We're getting orders for both U.S. and Mexico production. And we talk to them about that. They're very open before we take those orders. But it's 1 of the 3 things. Remember, steel being up, so the cost of tank cars up. Interest rates are up. So again, the cost of a tank car overall for financing is up. And then the uncertainty around tariffs do have some of our customers delaying those decisions.

Andrzej Tomczyk

Understood. And just sort of following on to that related to the antidumping and countervailing duty petitions that were filed by UTLX. Curious if you could just give us a sense of the time line.

I know you guys are going to be obviously vigorously defending your position there. Maybe just a time line around when you expect to hear decisions back? And then are customers pausing order commitments sort of asking about the backlog and if that could be impacted at all? Or is this sort of all up in the air at this point?

E. Savage

Okay. So yes, the proceedings are still very early. We're not predicting the outcome of those or the amount and timing of any of the duties, but we believe it will be late next year before that is finalized. That has not caused anyone to delay orders that we already have in our backlog or ask us to delay. It's also uncertainty, so it could fall into the 232 bucket.

But overall, that's why I said freight car pickup in orders is higher than tank car right now. I think a little of that uncertainty is weighing out there, but we've not seen any changes to orders we already have or delays -- excuse me, asking for delays in production of what we've got in our backlog.

Andrzej Tomczyk

Got it. And then maybe just switching here to leasing. You guys did up the gains forecast. Maybe just talk about that. Is that just a reflection of the secondary market strength ongoing? And if you could just speak to absolute lease rates in the quarter, how they've been progressing, if they've been elevated at high levels, if they're increasing? Maybe any color there would be helpful and appreciated as well.

Eric Marchetto

Yes. Andre, this is Eric. I'll talk about that. We are seeing the secondary market remain quite healthy, quite strong. We did increase our guidance on gains by roughly $20 million at the midpoint for the year. And that's just the activity that we're seeing. We have line of sight on executing on those transactions.

In terms of just a little bit of color on the market, in my prepared remarks, I talked about the inflationary pressures that we're seeing on new railcars -- we're seeing -- I talked about how that's impacting lease rates on new railcars as well.

When you look at the secondary market, it's pretty clear to me that buyers in the secondary market are also underwriting higher lease rates in the future. We have seen higher interest rates, and we have not seen that impact valuations. And that -- the conclusion from that is people are -- investors are underwriting higher rates in the future to offset that, which makes sense. That's what should happen. And I think we're seeing a lot of discipline in the secondary market in terms of underwriting decisions and how they price in the secondary market activity.

Andrzej Tomczyk

Got it. And relatedly, your future lease rate differential, can you talk about just sort of, I think, some moderation there versus last quarter. Is that just a reflection of is that timing of the renewal comparisons rolling off? Or should we read into that related to any major car types that are starting to plateau? Any thoughts there as well would be appreciated.

E. Savage

Sure. As you know, we've repriced the majority of our fleet into the higher rate environment. So we're lapping there. When you also look at the mix of cars, that does affect it from quarter-to-quarter. We're encouraged by what we're seeing in October. One month doesn't make a quarter at all, but we're encouraged to start seeing some of the improvements on that and look forward, as we keep saying, we've got high utilization, high renewal rates. We're scrapping more cars that are being built to replace that.

Market is continuing to tighten. All the input costs are going up along with those interest rates. So we fully expect -- we can't call the exact timing, but fully expect those lease rates to continue to go up.

Eric Marchetto

And rail traffic is improving pretty materially.

Andrzej Tomczyk

Yes. No, that's certainly a good sign there as well. Maybe just lastly for me to close off. You mentioned the small acquisition in October, the Texas-based provider. Can you speak to -- is that a move to get sort of more domestic exposure? Or was that something already in the works? Just curious if you could talk how that adds value to the platform and the strategy and if there are any synergies there to think about?

E. Savage

Sure. Andre, I'll take that. So there are about 11,000 rubber-lined tank cars in the fleets across North America right now. And we have a large portion of those. Getting this allows us to service the market better. So it gives us more opportunity to address not only our fleet, but third-party fleets that have that type of lining and their tank cars. It's not a material move.

It just goes along with our servicing options that we talk about, our maintenance options and expands our capability to take care of those fleets. There's one thing I also want to add in from an earlier question, and that was to do with the sale of Longview 200. We had built that sale into the $2.20 to $2.40 that we gave you at the beginning of the year. So we had some proceeds already built into that number. So I don't want you to think that that's on top of numbers we'd already built.

Andrzej Tomczyk

Thanks for clarification, and appreciate all the time, everybody.

Operator

This will conclude our question-and-answer session. I would like to turn the conference back over to Jean Savage for any closing remarks. Please go ahead.

E. Savage

Well, thank you for joining us today. As you've heard from our comments, our third quarter reflects a business positioned for growth with momentum building. Our leasing platform continues to perform.

Our manufacturing volumes are improving, and we believe 2026 will mark the cyclical low for industry deliveries. We appreciate your support and look forward to updating you next quarter where we will provide guidance for 2027.

Operator

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.