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What changed in GATX CORP's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of GATX CORP's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+194 added−202 removedSource: 10-K (2025-02-19) vs 10-K (2024-02-16)

Top changes in GATX CORP's 2024 10-K

194 paragraphs added · 202 removed · 171 edited across 7 sections

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

47 edited+3 added−11 removed82 unchanged
Biggest changeOur foreign operations and international expansion strategy are subject to the following risks associated with international operations: • Unforeseen developments and conditions, including terrorism, war, epidemics, and international tensions and conflicts • Supply chain disruptions • Inability to access railcar, tank container or component supply • Imposition of sanctions against countries where we operate or specific companies or individuals with whom we do business, or retaliatory sanctions by such countries on companies in the U.S. or in other countries in which we operate • Nationalization or confiscation of assets by foreign governments, and imposition of additional or new tariffs, quotas, trade barriers, regulations, and similar restrictions on our operations outside the United States • Inflation or deflation • Fluctuations in currency values • Sudden changes in foreign currency exchange controls • Noncompliance with U.S. laws affecting operations outside of the United States, such as the Foreign Corrupt Practices Act • Noncompliance with a variety of foreign laws and regulations • Failure to properly implement changes in tax laws and the interpretation of those laws • Failure to develop and maintain data management practices that comply with laws related to cybersecurity, privacy, data localization, and data protection • Discriminatory or conflicting fiscal or trade policies • Difficulties enforcing contractual rights or foreclosing to obtain the return of our assets in certain jurisdictions • Uncollectible accounts and longer collection cycles that may be more prevalent in foreign countries • Ineffective or delayed implementation of appropriate controls, policies, and processes across our diverse operations and employee base Many of our employees are represented by unions, and failure to successfully negotiate collective bargaining agreements may result in strikes, work stoppages, or substantially higher labor costs.
Biggest changeOur foreign operations and international expansion strategy are subject to the following risks associated with international operations: • Unforeseen developments and conditions, including terrorism, war, and international tensions and conflicts; • Supply chain disruptions; • Imposition of additional or new tariffs, quotas, trade barriers, embargoes, regulations, and similar restrictions on operations outside the United States; • Inability to access railcar, tank container or component supply; • Imposition of sanctions against countries where we operate or specific companies or individuals with whom we do business, or retaliatory sanctions by such countries on companies in the U.S. or in other countries in which we operate; • Nationalization or confiscation of assets by foreign governments; • Inflation or deflation; • Fluctuations in currency values; • Sudden changes in foreign currency exchange controls; • Noncompliance with U.S. laws affecting operations outside of the United States, such as the Foreign Corrupt Practices Act; • Noncompliance with a variety of foreign laws and regulations; • Failure to properly implement changes in tax laws and the interpretation of those laws; • Failure to develop and maintain data management practices that comply with laws related to cybersecurity, privacy, artificial intelligence, data localization, and data protection; • Discriminatory or conflicting fiscal or trade policies; • Difficulties enforcing contractual rights or foreclosing to obtain the return of our assets in certain jurisdictions; • Uncollectible accounts and longer collection cycles that may be more prevalent in foreign countries; and • Ineffective or delayed implementation of appropriate controls, policies, and processes across our diverse operations and employee base.
GATX and Rolls-Royce plc. (“Rolls-Royce”) each own 50% of domestic and foreign joint venture entities (collectively, the “RRPF affiliates” or “RRPF”) that own and lease aircraft spare engines to Rolls-Royce and owners and operators of commercial aircraft. In addition, GATX directly invests in Rolls-Royce aircraft spare engines through its wholly owned subsidiary, GATX Engine Leasing Ltd.
GATX and Rolls-Royce plc. (“Rolls-Royce”) each own 50% of domestic and foreign joint venture entities (collectively, the “RRPF affiliates” or “RRPF”) that own and lease aircraft spare engines to Rolls-Royce and owners and operators of commercial aircraft. In addition, GATX directly invests in aircraft spare engines through its wholly owned subsidiary, GATX Engine Leasing Ltd.
A deterioration in (1) the performance of services provided by Rolls-Royce or RRPF, or (2) the durability and reliability of Rolls-Royce engines, or (3) the financial condition, creditworthiness or liquidity of Rolls-Royce or RRPF could negatively impact GATX’s financial performance or, in the case of GEL, its operational performance. Our transportation assets may become obsolete.
A deterioration in (1) the performance of services provided by Rolls-Royce or RRPF, or (2) the durability and reliability of the engines, or (3) the financial condition, creditworthiness or liquidity of Rolls-Royce or RRPF could negatively impact GATX’s financial performance or, in the case of GEL, its operational performance. Our transportation assets may become obsolete.
Among other circumstances, the following may change our estimates of the cash flows we expect our long-lived assets or joint venture investments will generate, which could require us to recognize asset impairment charges: • A weak economic environment or challenging market conditions • New laws, rules or regulations affecting our assets or the commodities that they carry, or changes to existing laws, rules or regulations • Events related to particular customers or asset types or geographic markets • Asset or portfolio sale decisions by management.
Among other circumstances, the following may change our estimates of the cash flows we expect our long-lived assets or joint venture investments will generate, which could require us to recognize asset impairment charges: • A weak economic environment or challenging market conditions; • New laws, rules or regulations affecting our assets or the commodities that they carry, or changes to existing laws, rules or regulations; • Events related to particular customers or asset types or geographic markets; and • Asset or portfolio sale decisions by management.
In addition to conditions in the capital markets, changes in our financial performance or credit ratings or ratings outlook, as determined by rating agencies such as Standard & Poor’s, Moody’s Investors Service, and Fitch Ratings, Inc., or continuing increased interest rates could cause us to incur increased borrowing costs or to have greater difficulty accessing public and private markets for secured and unsecured debt.
In addition to conditions in the capital markets, negative changes in our financial performance or credit ratings or ratings outlook, as determined by rating agencies such as Standard & Poor’s, Moody’s Investors Service, and Fitch Ratings, Inc., or continuing increased interest rates could cause us to incur increased borrowing costs or to have greater difficulty accessing public and private markets for secured and unsecured debt.
As of the most recent public filings, six shareholders collectively control more than 60% of our outstanding common stock. Accordingly, a small number of shareholders could affect matters that require shareholder approval, such as the election of directors and the approval of significant business transactions. 20 General Risk Factors We may not be able to obtain cost-effective insurance.
As of the most recent public filings, six shareholders collectively control more than 60% of our outstanding common stock. Accordingly, a small number of shareholders could affect matters that require shareholder approval, such as the election of directors and the approval of significant business transactions. General Risk Factors We may not be able to obtain cost-effective insurance.
The availability and relative cost of alternative modes of transportation and changes in customer transportation preferences also could reduce demand for our assets. For example, technological innovations in the trucking industry and patterns in U.S. economic growth that favor truck over rail could result in a modal shift away from rail and reduce customer demand for our rail assets.
The availability and relative cost of alternative modes of transportation and changes in customer transportation preferences also could reduce demand for our assets. For example, technological innovations in the trucking industry and patterns in U.S. economic 13 growth that favor truck over rail could result in a modal shift away from rail and reduce customer demand for our rail assets.
Deterioration of conditions in the global capital markets, or negative changes in our credit ratings or continuing increased interest rates may limit our ability to obtain financing and may increase our borrowing costs. We rely largely on banks and the capital markets to fund our operations and contractual commitments.
Deterioration of conditions in the global capital markets, or negative changes in our credit ratings or increased interest rates may limit our ability to obtain financing and may increase our borrowing costs. We rely largely on the capital markets and banks to fund our operations and contractual commitments.
Prolonged inflation, as well as resulting interest rate increases, or deflation could have an adverse impact on our business and financial results. The timing and duration of the effects of inflation are unpredictable and depend on market conditions, the magnitude of the inflation and other economic factors.
Prolonged inflation, as well as interest rate increases, or deflation could have an adverse impact on our business and financial results. The timing and duration of the effects of inflation are unpredictable and depend on market conditions, the magnitude of the inflation and other economic factors.
These valuation differences may be positive or negative and could be material based on market conditions and demand for certain assets. 21 Our internal control over financial accounting and reporting may not detect all errors or omissions in the financial statements.
These valuation differences may be positive or negative and could be material based on market conditions and demand for certain assets. Our internal control over financial accounting and reporting may not detect all errors or omissions in the financial statements.
In addition, demand for transportation assets used to transport certain commodities, including ethanol and other renewable fuels, may be affected by government subsidies and mandates, which may be enacted, changed, or eliminated from time to time, while demand for transportation assets used to transport fossil fuels or that directly or indirectly require consumption of fossil fuels for operation may be affected by government policies and mandates with respect to climate change and carbon emissions.
In addition, demand for transportation assets used to transport certain commodities, including ethanol and other renewable fuels, may be affected by government subsidies and mandates, which may be enacted, changed, or eliminated from time to time, while demand for transportation assets used to transport fossil fuels or that directly or indirectly require consumption of fossil fuels for operation may be affected by government policies and mandates with respect to climate matters and carbon emissions.
Depending upon the severity, scope, and duration of these circumstances, the impact on our financial position, results of operations, and cash flows could be material.
Depending upon the severity, scope, and duration of these circumstances, the impact on our business, financial position, results of operations, and cash flows could be material.
Due to the regulatory complexities, risk of unidentified contaminants on our properties, and the potential liability for our operations as well as those of our lessees, it is possible environmental and remediation costs may be materially greater than the costs we have estimated. We may be affected by climate change or market or regulatory responses to climate change.
Due to the regulatory complexities, risk of unidentified contaminants on our properties, and the potential liability for our operations as well as those of our lessees, it is possible environmental and remediation costs may be materially greater than the costs we have estimated. We may be affected by climate matters or market or regulatory responses to climate matters.
(“GEL”), and places some of these engines on long-term leases with airline operators, with an RRPF entity serving as the asset manager. For other engines, GEL also provides Rolls-Royce with access to aircraft spare engine capacity to support Rolls-Royce’s engine maintenance program for its customers.
(“GEL”), and places some of these engines on long-term leases with airline operators, with RRPF serving as the asset manager. For other engines, GEL also provides Rolls-Royce with access to aircraft spare engine capacity to support Rolls-Royce’s engine maintenance program for its customers.
Typical funding sources include commercial paper, bank term loans, public debt issuances, and a variety of other secured and unsecured financing structures. These markets can experience high levels of volatility and access to capital can be limited for an extended period of time.
Typical funding sources include public debt issuances, bank term loans, private placement loans, commercial paper, and a variety of other unsecured and secured financing structures. These markets can experience high levels of volatility and access to capital can be limited for an extended period of time.
We are subject to the risks associated with natural disasters and the physical effects of climate change, which may increase in frequency and severity over time and may have a material adverse effect on our assets, operations and business.
We are subject to the risks associated with natural disasters and the physical effects of climate matters, which may increase in frequency and severity over time and may have a material adverse effect on our assets, operations and business.
In addition, if tariffs, labor interruptions or shortages, trade disputes, commodity prices, geopolitical tensions, inflation, supply chain disruptions, or other factors lead to higher prices for steel or other raw materials used to manufacture railcars, we may be required to pay higher prices to purchase new railcars, which could adversely affect our ability to profitably lease those railcars to customers.
In addition, if tariffs, labor interruptions or shortages, trade disputes, commodity prices, geopolitical tensions, inflation, supply chain disruptions, or other factors lead to higher prices for steel or other raw materials used to manufacture railcars or components utilized in such railcars, we may be required to pay higher prices to purchase new railcars, which could adversely affect our ability to profitably lease those railcars to customers.
In order to obtain committed access to a supply of newly built railcars on competitive terms, we regularly enter into long-term supply agreements with manufacturers to purchase significant numbers of newly built railcars over a multi-year period.
In order to obtain committed access to a supply of newly built railcars on competitive terms, we periodically enter into long-term supply agreements with manufacturers to purchase significant numbers of newly built railcars over a multi-year period.
Alternatively, if PSR results in increased pricing and/or reduced service frequency, safety and quality, the value proposition of rail freight for shippers relative to alternative modes of transportation could be reduced.
Alternatively, if PSR results in increased pricing and/or reduced service frequency, decreased reliability, safety and/or quality, the value proposition of rail freight for shippers relative to alternative modes of transportation could be reduced.
These acquisitions and divestitures may present financial, managerial, and operational challenges, including diversion of management attention from existing businesses, difficulty with integrating or separating personnel and financial and other systems, increased expenses and costs, assumption of liabilities and indemnities, increased compliance risks, and potential disputes with the buyers or sellers or third parties.
These transactions may present financial, managerial, and operational challenges, including diversion of management attention from existing businesses, difficulty with integrating or separating personnel and financial and other systems, increased expenses and costs, assumption of liabilities and indemnities, increased compliance risks, and potential disputes with the buyers or sellers or third parties.
In addition, changes in laws, rules, and regulations, or actions by authorities or other third parties to address GHG and climate change could negatively impact our customers and business.
In addition, changes in laws, rules, and regulations, or actions by authorities or other third parties to address GHG and climate matters could negatively impact our customers and business.
We also are subject to an evolving body of federal, state and foreign laws, regulations, guidelines and principles regarding data privacy, data protection and data security.
We also are subject to an evolving body of federal, state and foreign laws, regulations, guidelines and principles regarding data privacy, data protection, data security, and artificial intelligence.
We may be adversely affected by national and international political developments, instability, and uncertainties, including political unrest and threats of terrorist attacks or war, which could lead to the following: • Legislation or regulatory action directed toward improving the security of transportation assets against acts of terrorism, which could affect the construction or operation of transportation assets and increase costs • A decrease in demand for transportation assets and services • Lower utilization of transportation equipment • Lower transportation asset lease rates • Impairments and loss of transportation assets • Supply chain challenges and disruptions • Capital market disruption, which may raise our financing costs or limit our access to capital • Liability or losses resulting from acts of terrorism involving our assets • Increased risk of cybersecurity attacks • A significant deterioration of global growth, and related decreases in confidence or investment activity in the global markets, arising from political or economic tensions, changes, and trends and/or an increase in trade conflict and protectionism.
We may be adversely affected by national and international political developments, instability, and uncertainties, including political unrest and threats of terrorist attacks or war, which could lead to the following: • Legislation or regulatory action directed toward improving the security of transportation assets against acts of terrorism, which could affect the construction or operation of transportation assets and increase costs; • A decrease in demand for transportation assets and services; • Lower utilization of transportation equipment; • Lower transportation asset lease rates; • Impairments and loss of transportation assets; • Supply chain challenges and disruptions; • Capital market disruption, which may raise our financing costs or limit our access to capital; • Trade wars and imposition of new and retaliatory tariffs; • Liability or losses resulting from acts of terrorism involving our assets; • Increased risk of cybersecurity attacks; • Higher insurance costs, reduced coverage amounts or limited access to insurance; and • A significant deterioration of global growth, and related decreases in confidence or investment activity in the global markets, arising from political or economic tensions, changes, and trends and/or an increase in trade conflict and protectionism.
Customer demand for our transportation assets and services can be adversely affected by various economic and other factors, including: • Prolonged inflation or deflation • High interest rates • Weak macroeconomic conditions and world trade policies • Weak market conditions in our customers’ businesses • Adverse changes in the price of, or demand for, commodities • Changes in railroad operations, efficiency, safety, pricing and service offerings, including those related to “precision scheduled railroading” or labor strikes or shortages • Changes in, or disruptions to, supply chains • Availability of pipelines, trucks, and other alternative modes of transportation • Changes in conditions affecting the aviation industry, including geographic exposure and customer concentrations • Other operational or commercial needs or decisions of our customers Demand for our railcars and other transportation assets is dependent on the strength and growth of our customers’ businesses.
Customer demand for our transportation assets and services can be adversely affected by various economic and other factors, including: • Prolonged inflation or deflation; • High interest rates; • Weak macroeconomic conditions and world trade policies, including tariffs, embargoes and sanctions; • Weak market conditions in our customers’ businesses; • Adverse changes in the price of, or demand for, commodities; • Changes in railroad operations, efficiency, safety, pricing and service offerings, including those related to “precision scheduled railroading” or labor strikes or shortages; • Changes in, or disruptions to, supply chains; • Availability of pipelines, trucks, and other alternative modes of transportation; • Changes in conditions affecting the aviation industry, including geographic exposure, global conflict and customer concentrations; and • Other operational or commercial needs or decisions of our customers.
Fluctuations in foreign exchange rates could negatively impact our results of operations. Upon consolidation, we translate the financial results of certain subsidiaries from their local currency to the U.S. dollar, which exposes us to foreign exchange rate fluctuations. As exchange rates vary, the translated operating results of foreign subsidiaries may differ materially from period to period.
Upon consolidation, we translate the financial results of certain subsidiaries from their local currency to the U.S. dollar, which exposes us to foreign exchange rate fluctuations. As exchange rates vary, the translated operating results of foreign subsidiaries may differ materially from period to period.
A significant decline in customer demand for our assets and services could adversely affect our financial performance. In many cases, demand for our transportation assets also depends on our customers’ desire to lease, rather than buy, the assets. Tax and accounting considerations, interest rates, and operational flexibility, among other factors, may influence a customer’s decision to lease or buy assets.
In many cases, demand for our transportation assets also depends on our customers’ desire to lease, rather than buy, the assets. Tax and accounting considerations, interest rates, and operational flexibility, among other factors, may influence a customer’s decision to lease or buy assets.
These factors may enable our competitors to offer leases or services to customers at lower rates than we can provide, thus negatively impacting our profitability, asset utilization, and investment volume.
These factors may enable our competitors to offer leases or services to customers at lower rates than we can provide, thus negatively impacting our profitability, asset utilization, and investment volume. In addition, decreasing interest rates may invite new competition.
If we are unable to adequately maintain and secure our information technology (“IT”) infrastructure from cybersecurity threats and related disruptions, our business could be negatively impacted. We rely on our IT Infrastructure (defined below) to process, transmit, and store electronic information that is used in all aspects of our business operations, including employee and customer information.
If we are unable to adequately maintain and secure our information technology (“IT”) infrastructure from cybersecurity threats and related disruptions, our business could be negatively impacted. We rely on our IT Infrastructure (defined below) in all aspects of our business operations.
Any of these factors, individually or in operation with one or more of the other factors, or other unforeseen impacts of climate change, could reduce the demand for and value of our assets, and could have an adverse effect on our financial position, results of operations, and cash flows. 18 Economic and Credit Risks United States and global political conditions and increased geopolitical tension, including the ongoing war between Russia and Ukraine and resulting sanctions and countermeasures, could adversely affect our business, financial condition and results of operations.
Any of these factors, individually or in operation with one or more of the other factors, or other unforeseen impacts of climate matters, could reduce the demand for and value of our assets, and could have an adverse effect on our financial position, results of operations, and cash flows. 18 Economic and Credit Risks United States and global political conditions and increased geopolitical tension, civil unrest and armed conflict could adversely affect our business, financial condition and results of operations.
Changes to assumptions used to calculate post-retirement costs, increases in funding requirements, and investment losses in pension funds could adversely affect our results of operations. We calculate our pension and other post-retirement costs using various assumptions, such as discount rates, long-term return on plan assets, salary increases, health care cost trend rates, and other factors.
We calculate our pension and other post-retirement costs using various assumptions, such as discount rates, long-term return on plan assets, salary increases, health care cost trend rates, and other factors. Changes to any of these assumptions could adversely affect our financial position and results of operations.
Some of our customers operate in cyclical or fluctuating markets, such as the steel, energy, chemical, transportation, and construction industries, which are susceptible to macroeconomic downturns and may experience significant changes in demand over time.
Demand for our railcars and other transportation assets is dependent on the strength and growth of our customers’ businesses. Some of our customers operate in cyclical or fluctuating markets, such as the steel, energy, chemical, transportation, and construction industries, which are susceptible to macroeconomic downturns and may experience significant changes in demand over time.
Our North American rail asset leasing business is impacted by the operations of the railroads, particularly the largest rail systems known as the “Class I railroads”, most of which are utilizing some form of major operational transformation under the umbrella term of “precision scheduled railroading” or “PSR”.
Our North American rail asset leasing business is impacted by the operations of the railroads, particularly the largest rail systems known as the “Class I railroads”, most of which are operating under a philosophy known as “precision scheduled railroading” or “PSR”.
As noted below, rising interest rates could increase our borrowing costs, potentially decreasing our profitability. In addition, increased borrowing costs faced by our customers could also result in decreased demand for our transportation assets and services and have a dampening effect on overall economic activity, which could have a negative impact on our business and results of operations.
In addition, increased borrowing costs faced by our customers could also result in decreased demand for our transportation assets and services and have a dampening effect on overall economic activity, which could have a negative impact on our business and results of operations. Fluctuations in foreign exchange rates could negatively impact our results of operations.
If insurance coverage becomes prohibitively expensive or unavailable, we could be forced to reduce our coverage amount and increase the amount of self-insured risk we retain, thereby increasing our exposure to uninsured adverse judgments and other losses and liabilities that could have a material effect on our financial position, results of operations, and cash flows.
If insurance coverage becomes prohibitively expensive or unavailable, we could be forced to reduce our coverage amount and increase the amount of self-insured risk we retain, thereby increasing our exposure to uninsured adverse judgments and other losses and liabilities that could have a material effect on our financial position, results of operations, and cash flows. 20 Changes to assumptions used to calculate post-retirement costs, increases in funding requirements, and investment losses in pension funds could adversely affect our results of operations.
Changes in the mix of earnings in the U.S. and foreign countries and in tax rates and laws could adversely affect our financial results. As a global company, we are subject to taxation in the U.S. and numerous other non-U.S. jurisdictions. Significant judgment is required to determine our consolidated income tax position and related liabilities.
As a global company, we are subject to taxation in the U.S. and numerous other non-U.S. jurisdictions. Significant judgment is required to determine our consolidated income tax position and related liabilities.
Conversely, a period of prolonged deflation could negatively impact our lease rate pricing, residual values, and asset remarketing opportunities. These negative impacts of deflation may be offset by decreases to our costs for goods and services, including those listed above. 19 In response to inflation, central bank policy interest rates continued to increase in fiscal year 2023.
Conversely, a period of prolonged deflation could negatively impact our lease rate pricing, residual values, and asset remarketing opportunities. These negative impacts of deflation may be offset by decreases to our costs for goods and services, including those listed above. 19 As noted below, rising interest rates could increase our borrowing costs, potentially decreasing our profitability.
Demand 13 for our other transportation assets and related services is also influenced by many of the factors discussed above. For example, aircraft spare engine leasing is influenced by airline and lessee profitability, patterns in global air travel, reliability and durability of engine types, world trade policies, geopolitical tensions or conflict, technological advances, and price and other competitive factors.
For example, aircraft spare engine leasing is influenced by airline and lessee profitability, patterns in global air travel, reliability and durability of engine types, world trade policies, widespread health crises, geopolitical tensions or conflict, technological advances, and price and other competitive factors. A significant decline in customer demand for our assets and services could adversely affect our financial performance.
Moreover, failure of such controls to provide accurate and complete information could result in violation of such rules or regulations, which could have a material effect on our financial position, results of operations, cash flows, and reputation Climate change may also pose regulatory and environmental risks that could harm our results of operations and affect the way we conduct business.
If the cost of such controls is significant, it could adversely affect our financial condition and result of operations. Moreover, failure of such controls to provide accurate and complete information could result in violation of such rules or regulations, which could have a material effect on our financial position, results of operations, cash flows, and reputation.
Regulatory focus on climate change and greenhouse gas (“GHG”) emissions has increased across the globe. New government regulations could increase our operating costs and compliance with those regulations could be costly. For example, regulators in Europe and the U.S. have recently focused efforts on increased disclosure related to climate change and mitigation efforts.
Regulatory focus on climate matters and greenhouse gas (“GHG”) emissions has increased across the globe. New government regulations could increase our operating costs and compliance with those regulations could be costly.
The emergence of new variants of COVID-19 or the occurrence of another widespread health crisis and measures taken in response could have an adverse impact on our operations, commercial activity, asset values, financial position or liquidity.
No system of internal control provides absolute assurance that the financial statements are accurate and free of material error. 21 The occurrence of a widespread health crisis and measures taken in response could have an adverse impact on our operations, commercial activity, asset values, financial position or liquidity.
Severe weather, climate change, and natural disasters, such as tornadoes, flooding, fires and earthquakes, could cause significant business interruptions and result in increased costs and liabilities and decreased revenues.
Climate matters may also pose regulatory and environmental risks that could harm our results of operations and affect the way we conduct business. Severe weather, climate matters, and natural disasters, such as tornadoes, flooding, hurricanes, fires and earthquakes, could cause significant business interruptions and result in increased costs and liabilities and decreased revenues.
The timing, amount and payment of future dividends to shareholders and repurchases of our common stock fall within the discretion of our Board of Directors (the “Board”).
Risks Related to our Common Stock There can be no assurance that we will continue to pay dividends or repurchase shares of our common stock at current levels. The timing, amount and payment of future dividends to shareholders and repurchases of our common stock fall within the discretion of our Board of Directors (the “Board”).
The emergence of new variants of COVID-19 or the occurrence of another widespread health crisis and governmental action taken in response thereto may result in operational and labor disruptions, employee attrition and difficulty securing future labor needs, as well as have impacts on the broader employment market and supply chains, our suppliers, and our customers.
Such a crisis could also result in operational and labor disruptions, employee attrition and difficulty securing future labor needs, as well as impacts the broader employment market and supply chains, our suppliers, and our customers.
Additionally, changes to laws, regulations, or rules could require us to increase funding requirements or to compensate for investment losses in pension plan assets. If we were forced to increase contributions to our pension plans, our financial position, results of operations, and cash flows could be negatively affected.
If we were forced to increase contributions to our pension plans, our financial position, results of operations, and cash flows could be negatively affected. Changes in the mix of earnings in the U.S. and foreign countries and in tax rates and laws could adversely affect our financial results.
Changes to any of these assumptions could adversely affect our financial position and results of operations. Periods of low interest rates reduce the discount rate we use to calculate our funding obligations, which may increase our funding requirements.
Periods of low interest rates reduce the discount rate we use to calculate our funding obligations, which may increase our funding requirements. Additionally, changes to laws, regulations, or rules could require us to increase funding requirements or to compensate for investment losses in pension plan assets.
These impacts could materially and adversely affect our costs, operations, financial performance, and liquidity, as well as our ability to successfully execute our business strategy. Risks Related to our Common Stock There can be no assurance that we will continue to pay dividends or repurchase shares of our common stock at current levels.
These impacts could materially and adversely affect our business, costs, operations, financial performance, and liquidity, as well as our ability to successfully execute our business strategy. Item 1B. Unresolved Staff Comments None.
The recent COVID-19 pandemic negatively impacted businesses globally, including our business, by causing or contributing to a slowdown in economic activity around the world (including a decrease in demand for a broad variety of goods and services), disruptions in global supply chains, a dramatic reduction in air travel, and volatility and disruption of financial markets.
The occurrence of a widespread health crisis and governmental action or inaction taken in response thereto could cause or contribute to a slowdown in economic activity, disruptions in global supply chains, a dramatic reduction in air travel, and volatility and disruption of financial markets.
Removed
The European Union recently adopted the Corporate Sustainability Reporting Directive (“CSRD”) and related European Sustainability Reporting Standards that will require disclosure of the risks and opportunities arising from social and environmental issues and of the impact of companies’ activities on people and the environment.
Added
Demand for our other transportation assets and related services is also influenced by many of the factors discussed above.
Removed
We will be required to report under the CSRD for much of our business beginning in 2026.
Added
Many of our employees are represented by unions, and failure to successfully negotiate collective bargaining agreements may result in strikes, work stoppages, or substantially higher labor costs.
Removed
Similarly, the State of California recently passed the Climate Corporate Data Accountability Act and the Climate-Related Financial Risk Act that will impose broad climate-related disclosure obligations on certain companies doing business in California, including us, starting in 2026, while additional states are considering similar climate-related disclosure regulations.
Added
New disclosure rules and regulations related to climate matters and mitigation efforts, such as the Corporate Sustainability Reporting Directive and related European Sustainability Reporting Standards in the European Union and climate disclosure laws and regulations in California, will require us to design and implement additional internal and disclosure controls.
Removed
The SEC has included in its regulatory agenda potential rulemaking on climate change that, if adopted, could require us to incur substantial monitoring and compliance costs. All of these new disclosure rules and regulations will require us to design and implement additional internal and disclosure controls.
Removed
If the cost of such controls is significant, it could adversely affect our financial condition and result of operations.
Removed
As an example of one such conflict, in February 2022, Russian military forces launched a military action in Ukraine. In response to this action, the United States and other countries imposed various economic sanctions and measures against Russia, Belarus, certain sections of Ukraine, and related persons and entities. Russia subsequently enacted countermeasures.
Removed
Additional sanctions and countermeasures have continued to be imposed as the conflict continues. The Russia/Ukraine conflict and related sanctions and countermeasures led to our decision to sell our rail business in Russia, but to date, the conflict has not had a material impact on business operations at our businesses outside of Russia.
Removed
We continue to closely monitor developments and potential impacts from enacted sanctions and countermeasures and will take mitigating actions as appropriate.
Removed
This conflict and resulting response have impacted the global economy, financial markets, and supply chains and could continue to adversely affect our business, financial condition, and results of operations, which impacts vary across our business units, including the RRPF affiliates. We continue to monitor the nature and magnitude of these impacts across our businesses.
Removed
There were extraordinary actions taken by governmental authorities to contain and combat the outbreak and spread of COVID-19 in regions throughout the world, including travel bans, quarantines, “stay-at-home” orders, and similar mandates for many individuals to substantially restrict daily activities and for many businesses to curtail or cease normal operations.
Removed
No system of internal control provides absolute assurance that the financial statements are accurate and free of material error. Item 1B. Unresolved Staff Comments None.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

4 edited+1 added−0 removed13 unchanged
Biggest changeThe Global Head of IT Security has served in various roles in information technology and information security for over 15 years, and holds undergraduate and graduate degrees in information security, as well as multiple certifications in cybersecurity and information technology. 23
Biggest changeThe CIO has over 25 years of experience in information technology, including over 17 years managing the cybersecurity function and resources. The Global Head of IT Security has over 15 years of experience in information technology and information security, including 10 years of leadership roles within the information security domain, and holds certifications in cybersecurity and risk management. 23
The results of such assessments, audits, and reviews are reported to the Audit Committee, and we adjust our cybersecurity processes as necessary based on the information provided by these assessments, audits, and reviews.
The results of such assessments, audits, and reviews are reported to senior management and the Audit Committee, and we adjust our cybersecurity processes as necessary based on the information provided by these assessments, audits, and reviews.
This plan is periodically reviewed, tested, and evaluated. • Third-Party Risk Management: We take a risk-based approach to identifying the cybersecurity risks presented by third-party service providers and encourage our service providers to reduce cybersecurity risks using commercially available safeguards. • Education and Awareness: We provide training for our employees regarding cybersecurity threats as a means to build awareness and equip them with effective tools to identify and address cybersecurity threats, as well as to communicate the Company’s evolving information security policies and practices.
The incident response plan also includes consideration of disclosure requirements and communication to appropriate parties within the Company. • Third-Party Risk Management: We take a risk-based approach to identifying the cybersecurity risks presented by third-party service providers and encourage our service providers to reduce cybersecurity risks using commercially available safeguards. • Education and Awareness: We provide training for our employees regarding cybersecurity threats as a means to build awareness and equip them with effective tools to identify and address cybersecurity threats, as well as to communicate the Company’s evolving information security policies and practices.
The Audit Committee discusses the Company’s approach to cybersecurity risk management with GATX senior management, including the CIO and the Global Head of IT Security.
The Audit Committee discusses the Company’s approach to cybersecurity risk management with GATX senior management, including the CIO and the Global Head of IT Security, who reports to the CIO and has responsibility for assessing and managing material risks from cybersecurity threats.
Added
This plan is periodically reviewed, tested, and evaluated.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAs of December 31, 2023, the locations of our operations were as follows: GATX Headquarters Chicago, Illinois Rail North America Business Offices Major Maintenance Facilities Mobile Units Chicago, Illinois Colton, California Galena Park, Texas Burlington, Ontario Hearne, Texas Edmonton, Alberta Calgary, Alberta Waycross, Georgia Mexico City, Mexico Montreal, Quebec Moose Jaw, Saskatchewan Red Deer, Alberta Maintenance Facilities Terre Haute, Indiana Customer Site Locations Clarkson, Ontario Rail International Business Offices Major Maintenance Facilities Customer Site Locations Dordrecht, Netherlands Ostróda, Poland Płock, Poland Baar, Switzerland Düsseldorf, Germany Hamburg, Germany Leipzig, Germany Delhi, India Gurgaon, India Paris, France Vienna, Austria Warsaw, Poland Portfolio Management Chicago, Illinois Other Dordrecht, Netherlands Houston, Texas Singapore Shanghai, China 24
Biggest changeAs of December 31, 2024, the locations of our operations were as follows: GATX Headquarters Chicago, Illinois Rail North America Business Offices Major Maintenance Facilities Customer Site Locations Chicago, Illinois Colton, California Clarkson, Ontario Calgary, Alberta Hearne, Texas Mexico City, Mexico Waycross, Georgia Montreal, Quebec Moose Jaw, Saskatchewan Red Deer, Alberta Maintenance Facilities Terre Haute, Indiana Mobile Units Edmonton, Alberta La Porte, Texas Rail International Business Offices Major Maintenance Facilities Customer Site Locations Dordrecht, Netherlands Ostróda, Poland Płock, Poland Baar, Switzerland Düsseldorf, Germany Hamburg, Germany Gurgaon, India Paris, France Vienna, Austria Warsaw, Poland Engine Leasing Chicago, Illinois Other Dordrecht, Netherlands Houston, Texas Singapore Shanghai, China 24

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following is a summary of common stock repurchases completed by month during the fourth quarter of 2023: Issuer Purchases of Equity Securities (a) (b) (c) (d) Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (in millions) October 1, 2023 - October 31, 2023 24,420 $ 104.68 24,420 $ 87.1 November 1, 2023 - November 30, 2023 100 $ 109.03 100 $ 87.1 Total 24,520 $ 104.70 24,520 25 Common Stock Performance Graph The performance graph below compares the cumulative total shareholder return on our common stock for the five-year period ended December 31, 2023, with the cumulative total return of the S&P 500 Index, the S&P MidCap 400 Index, and the Russell 3000 Index.
Biggest changeThe following is a summary of common stock repurchases completed by month during the fourth quarter of 2024: Issuer Purchases of Equity Securities Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Program Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (in millions) October 1, 2024 - October 31, 2024 300 $ 136.95 300 $ 65.2 November 1, 2024 - November 30, 2024 752 $ 149.92 752 $ 65.1 December 1, 2024 - December 31, 2024 — $ — — $ 65.1 Total 1,052 $ 146.22 1,052 25 Common Stock Performance Graph The performance graph below compares the cumulative total shareholder return on our common stock for the five-year period ended December 31, 2024, with the cumulative total return of the S&P 500 Index, the S&P MidCap 400 Index, and the Russell 3000 Index.
The share repurchase program does not have an expiration date, does not obligate the Company to repurchase any dollar amount or number of shares of common stock, and may be suspended or discontinued at any time. The timing of repurchases will be dependent on market conditions and other factors.
The share repurchase program does not have an expiration date, does not obligate the Company to repurchase any dollar amount or number of shares of common stock, and may be suspended or discontinued at any time. The timing of share repurchases will be dependent on market conditions and other factors.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities Our common stock is listed on the New York and Chicago Stock Exchanges under ticker symbol "GATX". We had approximately 1,336 common shareholders of record as of January 31, 2024. We have a long history of paying quarterly cash dividends.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities Our common stock is listed on the New York and Chicago Stock Exchanges under ticker symbol "GATX". We had approximately 1,272 common shareholders of record as of January 31, 2025. We have a long history of paying quarterly cash dividends.
During 2023, we repurchased 24,520 shares for $2.6 million under the share repurchase program. As of December 31, 2023, $87.1 million remained available under the repurchase authorization.
During 2024, we repurchased 167,452 shares for $21.9 million under the share repurchase program. As of December 31, 2024, $65.1 million remained available under the repurchase authorization.
The graph and table assume that $100 was invested in our common stock and each of the indices on December 31, 2018, and that all dividends were reinvested. 12/31/18 12/31/19 12/31/20 12/31/21 12/31/22 12/31/23 GATX $ 100.00 $ 119.75 $ 123.60 $ 158.13 $ 164.72 $ 189.73 S&P 500 100.00 131.47 155.65 200.29 163.98 207.04 S&P MidCap 400 100.00 126.17 143.39 178.85 155.42 180.90 Russell 3000 100.00 131.01 158.36 198.96 160.71 202.38 Item 6. [Reserved] 26
The graph and table assume that $100 was invested in our common stock and each of the indices on December 31, 2019, and that all dividends were reinvested. 12/31/19 12/31/20 12/31/21 12/31/22 12/31/23 12/31/24 GATX $ 100.00 $ 103.22 $ 132.05 $ 137.55 $ 158.44 $ 207.68 S&P 500 100.00 118.39 152.34 124.73 157.48 196.85 S&P MidCap 400 100.00 113.65 141.76 123.19 143.38 163.30 Russell 3000 100.00 120.88 151.87 122.68 154.48 191.24 Item 6. [Reserved] 26

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeItem 6. [Reserved] 26 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 27 Discussion of Operating Results 28 Change in Net Operating Assets and Facilities 42 Cash Flow Discussion 42 Liquidity and Capital Resources 45 Critical Accounting Policies and Estimates 48 New Accounting Pronouncements 50 Non-GAAP Financial Measures 50 Item 7A.
Biggest changeItem 6. [Reserved] 26 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 27 Discussion of Operating Results 28 Change in Net Operating Assets and Facilities 43 Cash Flow Discussion 43 Liquidity and Capital Resources 45 Critical Accounting Policies and Estimates 49 New Accounting Pronouncements 51 Non-GAAP Financial Measures 51 Item 7A.
Quantitative and Qualitative Disclosures About Market Risk 53 Item 8. Financial Statements and Supplementary Data 54
Quantitative and Qualitative Disclosures About Market Risk 54 Item 8. Financial Statements and Supplementary Data 55

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe following table shows Portfolio Management’s segment results for the years ended December 31 (in millions): 2023 2022 2021 Revenues Lease revenue $ 32.6 $ 33.0 $ 28.1 Non-dedicated engine revenue 37.6 1.5 — Marine operating revenue 6.9 18.9 19.1 Other revenue 0.1 0.2 0.5 Total Revenues 77.2 53.6 47.7 Expenses Marine operating expense 6.5 14.1 17.5 Depreciation expense 28.3 17.8 17.6 Other operating expense 7.3 2.3 1.7 Total Expenses 42.1 34.2 36.8 Other Income (Expense) Net gain (loss) on asset dispositions 2.2 (31.1) 8.0 Interest expense, net (29.8) (19.0) (16.6) Other income 0.2 — 2.0 Share of affiliates' pre-tax earnings 98.7 45.4 56.5 Segment Profit $ 106.4 $ 14.7 $ 60.8 Investment Volume $ 267.3 $ 149.7 $ 353.0 The following table shows the net book value of Portfolio Management’s assets as of December 31 (in millions): 2023 2022 Investment in RRPF Affiliates $ 626.8 $ 574.3 GEL owned aircraft spare engines 714.0 475.0 Specialized Gas Vessels — 25.1 Other owned assets 14.3 32.2 Total assets $ 1,355.1 $ 1,106.6 39 RRPF Affiliates Portfolio Data As of December 31, 2023, the RRPF affiliates' portfolio consisted of 399 aircraft spare engines with a net book value of $4,067.2 million, compared to 398 aircraft spare engines with a net book value of $4,176.5 million at the end of 2022.
Biggest changeIn 2023, Engine Leasing sold its natural gas holdings and recorded a gain of $5.7 million. 38 The following table shows Engine Leasing’s segment results for the years ended December 31 (in millions): 2024 2023 2022 Revenues Lease revenue $ 32.4 $ 32.6 $ 33.0 Non-dedicated engine revenue 64.6 37.6 1.5 Marine operating revenue — 6.9 18.9 Other revenue 0.1 0.1 0.2 Total Revenues 97.1 77.2 53.6 Expenses Depreciation expense 37.8 28.3 17.8 Marine operating expense — 6.5 14.1 Other operating expense 9.6 7.3 2.3 Total Expenses 47.4 42.1 34.2 Other Income (Expense) Net gain (loss) on asset dispositions 0.6 2.2 (31.1) Interest expense, net (41.9) (29.8) (19.0) Other income 0.6 0.2 — Share of affiliates' pre-tax earnings 108.3 98.7 45.4 Segment Profit $ 117.3 $ 106.4 $ 14.7 Investment Volume $ 260.8 $ 267.3 $ 149.7 The following table shows the net book value of Engine Leasing’s assets as of December 31 (in millions): 2024 2023 Investment in RRPF Affiliates $ 663.1 $ 626.8 GEL owned aircraft spare engines 937.0 714.0 Other owned assets 53.3 14.3 Total assets $ 1,653.4 $ 1,355.1 39 RRPF Affiliates Portfolio Data The following table shows portfolio activity and statistics for the RRPF affiliates' aircraft spare engines for the years ended December 31: 2024 2023 2022 Beginning balance 399 398 407 Engine acquisitions 47 14 9 Engine dispositions (19) (13) (18) Ending balance 427 399 398 Utilization rate at year end (1) 97.4 % 95.5 % 94.2 % Average leased engines (2) 398 376 372 Net book value of engines (in millions) $ 4,716.0 $ 4,067.2 $ 4,176.5 ________ (1) Utilization is calculated as the number of engines on lease as a percentage of total engines in the fleet.
(2) Active boxcars refers to the number boxcars on lease to customers. Changes in boxcars on lease compared to prior years are impacted by the utilization of new boxcars purchased from builders or in the secondary market and the disposition of boxcars that were sold or scrapped, as well as the fleet utilization rate.
(2) Active boxcars refers to the number of boxcars on lease to customers. Changes in boxcars on lease compared to prior years are impacted by the utilization of new boxcars purchased from builders or in the secondary market and the disposition of boxcars that were sold or scrapped, as well as the fleet utilization rate.
LIQUIDITY AND CAPITAL RESOURCES General We fund our investments and meet our debt, lease, and dividend obligations using our available cash balances, as well as cash generated from operating activities, sales of assets, commercial paper issuances, committed revolving credit facilities, distributions from affiliates, and issuances of secured and unsecured debt. We primarily use cash from operations to fund daily operations.
LIQUIDITY AND CAPITAL RESOURCES General We fund our investments and meet our debt, lease, and dividend obligations using our available cash balances, as well as cash generated from operating activities, sales of assets, distributions from affiliates, issuances of unsecured and secured debt, commercial paper issuances, and committed revolving credit facilities. We primarily use cash from operations to fund daily operations.
The share repurchase program does not have an expiration date, does not obligate the Company to repurchase any dollar amount or number of shares of common stock, and may be suspended or discontinued at any time. The timing of repurchases will be dependent on market conditions and other factors.
The share repurchase program does not have an expiration date, does not obligate the Company to repurchase any dollar amount or number of shares of common stock, and may be suspended or discontinued at any time. The timing of share repurchases will be dependent on market conditions and other factors.
Reconciliation of Non-GAAP Components Used in the Computation of Certain Financial Measures Net Income Measures We exclude the effects of certain tax adjustments and other items for purposes of presenting net income, diluted earnings per share, and return on equity because we believe these items are not attributable to our business operations.
Reconciliation of Non-GAAP Components Used in the Computation of Certain Financial Measures We exclude the effects of certain tax adjustments and other items for purposes of presenting net income, diluted earnings per share, and return on equity because we believe these items are not attributable to our business operations.
(3) Average active railcars for the year is calculated using the number of active railcars at the end of each month. Comparison of Reported Results Foreign Currency Rail International's reported results of operations are impacted by fluctuations in the exchange rates of the U.S. dollar versus the foreign currencies in which it conducts business, primarily the euro.
(3) Average active railcars for the year is calculated using the number of active railcars at the end of each month. 36 Comparison of Reported Results Foreign Currency Rail International's reported results of operations are impacted by fluctuations in the exchange rates of the U.S. dollar versus the foreign currencies in which it conducts business, primarily the euro.
See "Note 8. Debt" in Part II, Item 8 of this Form 10-K. Short-Term Borrowings and Credit Lines and Facilities We primarily use short-term borrowings as a source of working capital and to temporarily fund differences between our operating cash flows and portfolio proceeds, and our capital investments and debt maturities.
See "Note 8. Debt" in Part II, Item 8 of this Form 10-K. Short-Term Borrowings and Credit Lines and Facilities We use short-term borrowings as a source of working capital and to temporarily fund differences between our operating cash flows and portfolio proceeds, and our capital investments and debt maturities.
These measures are not in accordance with, or a substitute for, GAAP, and our financial measures may be different from non-GAAP financial measures used by other companies. We have provided a reconciliation of our non-GAAP components to the most directly comparable GAAP components.
These measures are not in accordance with, or a substitute for, GAAP, and our financial measures may be different from non-GAAP financial measures used by other companies. We have provided a reconciliation of our non-GAAP measures to the most directly comparable GAAP measures.
Additional contributions will depend primarily on plan asset investment returns and actuarial experience, and subject to the impact of these factors, we may make additional material plan contributions. 47 GATX Common Stock Repurchases On January 25, 2019, our board of directors approved a $300.0 million share repurchase program, pursuant to which we are authorized to purchase shares of our common stock in the open market, in privately negotiated transactions, or otherwise, including pursuant to Rule 10b5-1 plans.
Additional contributions will depend primarily on plan asset investment returns and actuarial experience, and subject to the impact of these factors, we may make additional material plan contributions. 48 GATX Common Stock Repurchases On January 25, 2019, our board of directors approved a $300.0 million share repurchase program, pursuant to which we are authorized to purchase shares of our common stock in the open market, in privately negotiated transactions, or otherwise, including pursuant to Rule 10b5-1 plans.
We base estimated future cash flows on a number of assumptions, including lease rates, lease term (including renewals), operating costs, freight rates and volume, the life of the asset, and final disposition proceeds. If we determine an asset is impaired, we recognize an impairment loss equal to the amount by which the carrying amount exceeds the asset’s fair value.
We base estimated future cash flows on a number of assumptions, including lease rates, lease term (including renewals), operating costs, the life of the asset, and final disposition proceeds. If we determine an asset is impaired, we recognize an impairment loss equal to the amount by which the carrying amount exceeds the asset’s fair value.
We also access domestic and international capital markets by issuing unsecured or secured debt and commercial paper. We use these resources, along with available cash balances, to fulfill our debt, lease, and dividend obligations, to support our share repurchase programs, and to fund portfolio investments and capital additions. We primarily use cash from operations to fund daily operations.
We also access domestic and international capital markets by issuing unsecured or secured debt. We use these resources, along with available cash balances, to fulfill our debt, lease, and dividend obligations, to support our share repurchase programs, and to fund portfolio investments and capital additions. We primarily use cash from operations to fund daily operations.
Share-Based Compensation" in Part II, Item 8 of this Form 10-K. 49 Income Taxes Our operations are subject to taxes in the United States, various states, and foreign countries, and as a result, we may be subject to audit in all of these jurisdictions.
Share-Based Compensation" in Part II, Item 8 of this Form 10-K. 50 Income Taxes Our operations are subject to taxes in the United States, various states, and foreign countries, and as a result, we may be subject to audit in all of these jurisdictions.
These amounts exclude railcars on leases expiring in 2024 that have already been renewed or assigned to a new lessee. In 2022, we entered into a new long-term railcar supply agreement with a subsidiary of Trinity Industries, Inc.
These amounts exclude railcars on leases expiring in 2025 that have already been renewed or assigned to a new lessee. In 2022, we entered into a long-term railcar supply agreement with a subsidiary of Trinity Industries, Inc.
Liquidity Outlook In addition to our contractual obligations, expenditures in 2024 may also include the purchase of railcars, tank containers, and aircraft spare engines and other discretionary capital spending for opportunistic asset purchases or strategic investments.
Liquidity Outlook In addition to our contractual obligations, expenditures in 2025 may also include the purchase of railcars, tank containers, and aircraft spare engines and other discretionary capital spending for opportunistic asset purchases or strategic investments.
For all fair value estimates, we use observable inputs whenever possible and appropriate. 48 Once we make an estimate of fair value, we compare the estimate of fair value to the investment’s carrying value. If the investment’s estimated fair value is less than its carrying value, then we consider the investment impaired.
For all fair value estimates, we use observable inputs whenever possible and appropriate. 49 Once we make an estimate of fair value, we compare the estimate of fair value to the investment’s carrying value. If the investment’s estimated fair value is less than its carrying value, then we consider the investment impaired.
(2) Active railcars refers to the number of railcars on lease to customers. Changes in railcars on lease compared to prior years are impacted by the utilization of railcars purchased and the disposition of railcars that were sold, as well as the fleet utilization rate.
(2) Active railcars refers to the number of railcars on lease to customers. Changes in railcars on lease compared to prior years are impacted by the utilization of railcars purchased and the disposition of railcars that were sold or scrapped, as well as the fleet utilization rate.
We anticipate remarketing income to be slightly lower than 2023, but we continue to see a strong secondary market. We expect the impact of slightly higher regulatory compliance work, offset by a benefit from efficiencies in our owned maintenance network to result in modestly higher maintenance expense in 2024 compared to the prior year.
We anticipate remarketing income to be slightly lower than 2024, but we continue to see a strong secondary market. We expect the impact of slightly higher regulatory compliance work, partially offset by a benefit from efficiencies in our owned maintenance network to result in modestly higher maintenance expense in 2025 compared to the prior year.
("Trinity") to purchase 15,000 newly built railcars through 2028, with an option to order up to an additional 500 railcars each year from 2023 to 2028. The agreement enables us to order a broad mix of tank and freight cars. Trinity will deliver 6,000 tank cars (1,200 per year) from 2024 through 2028.
("Trinity") to purchase 15,000 newly built railcars through 2028, with an option to order up to an additional 500 railcars each year from 2023 to 2028. The agreement enables us to order a broad mix of tank and freight cars. Trinity is scheduled to deliver 6,000 tank cars (1,200 per year) from 2024 through 2028.
We have a strong balance sheet and adequate access to capital, which we believe positions us well to manage our transportation assets based on current market conditions. • We expect Rail North America's segment profit in 2024 to increase from 2023.
We have a strong balance sheet and adequate access to capital, which we believe positions us well to manage our transportation assets based on current market conditions. • We expect Rail North America's segment profit in 2025 to increase slightly from 2024.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations OVERVIEW We lease, operate, manage, and remarket long-lived, widely used assets, primarily in the rail market. We report our financial results through three primary business segments: Rail North America, Rail International, and Portfolio Management.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations OVERVIEW We lease, operate, manage, and remarket long-lived, widely used assets, primarily in the rail market. We report our financial results through three primary business segments: Rail North America, Rail International, and Engine Leasing (previously named Portfolio Management).
The operating environment for our engine leasing businesses at RRPF and our owned GEL operations is strong, as demand for global air travel continues to recover to pre-pandemic levels and beyond.
The operating environment for our engine leasing businesses at RRPF and GEL is strong, as global air travel continues to recover to pre-pandemic levels and beyond.
Total investment volume was $1,665.0 million in 2023, compared to $1,255.8 million in 2022, and $1,131.9 million in 2021. 2024 Outlook Conditions in the North American railcar leasing market remained strong in 2023, and we expect favorable conditions to continue in 2024. At Rail International, we expect strong demand for our railcars in both our European and Indian businesses.
Total investment volume was $1,674.4 million in 2024, compared to $1,665.0 million in 2023, and $1,255.8 million in 2022. 2025 Outlook Conditions in the North American railcar leasing market remained strong in 2024, and we expect favorable conditions to continue in 2025. At Rail International, we expect favorable demand for our railcars in both our European and Indian businesses.
Our commercial commitments at December 31, 2023 are presented in "Note 15. Commercial Commitments" within Item 8 of this Form 10-K. Defined Benefit Plan Contributions In 2023, we contributed $7.1 million to our defined benefit pension plans and other post-retirement benefit plans. In 2024, we expect to contribute approximately $4.4 million.
Our commercial commitments at December 31, 2024 are presented in "Note 15. Commercial Commitments" within Item 8 of this Form 10-K. Defined Benefit Plan Contributions In 2024, we contributed $2.9 million to our defined benefit pension plans and other post-retirement benefit plans. In 2025, we expect to contribute approximately $4.2 million.
The timing of asset dispositions and changes in working capital impact cash flows from portfolio proceeds and operations. As a result, these cash flow components may vary materially from year to year. As of December 31, 2023, we had an unrestricted cash balance of $450.7 million.
The timing of asset dispositions and changes in working capital impact cash flows from portfolio proceeds and operations. As a result, these cash flow components may vary materially from year to year. As of December 31, 2024, we had an unrestricted cash balance of $401.6 million.
Results for 2023 included a net positive impact of $1.6 million ($0.05 per diluted share) from tax adjustments and other items, compared to a net negative impact of $61.8 million ($1.72 per diluted share) from tax adjustments and other items in 2022 and a net negative impact of $39.1 million ($1.08 per diluted share) from tax adjustments and other items in 2021 (see "Non-GAAP Financial Measures" at the end of this item for further details). • At Rail North America, segment profit in 2023 was lower than prior year.
Results for 2024 included a net negative impact of $3.9 million ($0.11 per diluted share) from tax adjustments and other items, compared to a net positive impact of $1.6 million ($0.05 per diluted share) from tax adjustments and other items in 2023 and a net negative impact of $61.8 million ($1.72 per diluted share) from tax adjustments and other items in 2022 (see "Non-GAAP Financial Measures" at the end of this item for further details). • At Rail North America, segment profit in 2024 was higher than prior year.
We do not maintain or target any particular level of short-term borrowings on a permanent basis. Rather, we will temporarily utilize short-term borrowings at levels we deem appropriate until we decide to pay down these balances. We have a $600 million, 5-year unsecured revolving credit facility in the United States.
We do not maintain or target any particular level of short-term borrowings on a permanent basis. Rather, we will temporarily utilize short-term borrowings at levels we deem appropriate until we decide to pay down these balances. 46 In 2024, we entered into a $600 million, 5-year unsecured revolving credit facility in the United States, expiring in May 2029.
Lease rates for railcars scheduled to renew in 2024 will likely be generally higher than expiring rates as the lease rate environment for existing railcars is expected to remain favorable. The increasing lease rates, along with new additions to the fleet, should generate higher lease revenue in 2024.
Lease rates for railcars scheduled to renew in 2025 will likely be higher than expiring rates for most car types as the lease rate environment for existing railcars is expected to remain favorable. The increasing lease rates, along with new additions to the fleet, should generate higher lease revenue in 2025.
Delayed Draw Term Loans As of December 31, 2023, we had $24.2 million available under an outstanding delayed draw term loan in India. Restrictive Covenants Our credit facilities and certain other debt agreements contain various restrictive covenants. See "Note 8. Debt" in Part II, Item 8 of this Form 10-K.
Delayed Draw Term Loans As of December 31, 2024, we had INR 2.0 billion ($23.4 million) available under an outstanding delayed draw term loan in India. Restrictive Covenants Our credit facilities and certain other debt agreements contain various restrictive covenants. See "Note 8. Debt" in Part II, Item 8 of this Form 10-K.
Unallocated interest income (expense) (the difference between external interest expense and interest expense allocated to the reporting segments) in any year is affected by our consolidated leverage position, the timing of debt issuances and investing activities, and intercompany allocations. Other income (expense), including eliminations, was favorable by $21.9 million in 2023 compared to 2022.
Unallocated interest income (the difference between external interest expense and interest expense allocated to the reporting segments) in any year is affected by our consolidated leverage position, the timing of debt issuances and investing activities, and intercompany allocations. Other (expense) income, including eliminations, was unfavorable by $11.3 million in 2024 compared to 2023.
Our investment volume is predominantly composed of acquired railcars, but may also include certain capitalized repairs and improvements to owned railcars. As a result, the dollar value of investment volume does not necessarily correspond to the number of railcars acquired in any given period.
Our investment volume is predominantly composed of acquired railcars, but also includes the acquisition of locomotives, certain capitalized repairs and improvements to owned railcars and our maintenance facilities. As a result, the dollar value of investment volume does not necessarily correspond to the number of railcars acquired in any given period.
The following table shows fleet activity and statistics for Rail North America locomotives for the years ended December 31: 2023 2022 2021 Beginning balance 544 577 645 Locomotives added, net of scrapped or sold (21) (33) (68) Ending balance 523 544 577 Utilization rate at year end (1) 88.3 % 89.3 % 89.8 % Active locomotives at year end (2) 462 486 518 Average active locomotives (3) 472 496 521 _______ (1) Utilization is calculated as the number of locomotives on lease as a percentage of total locomotives in the fleet.
The following table shows fleet activity and statistics for Rail North America locomotives for the years ended December 31: 2024 2023 2022 Beginning balance 523 544 577 Locomotives added 156 — — Locomotives scrapped or sold (18) (21) (33) Ending balance 661 523 544 Utilization rate at year end (1) 89.1 % 88.3 % 89.3 % Active locomotives at year end (2) 589 462 486 Average active locomotives (3) 509 472 496 _______ (1) Utilization is calculated as the number of locomotives on lease as a percentage of total locomotives in the fleet.
Demand for railcars in Europe should continue to be solid, and we plan to continue to invest in the fleet. Lease revenue is expected to be higher in 2024, resulting from more railcars on lease and higher lease rates.
Demand for railcars in Europe should continue to be solid across most car types, and we plan to continue to invest in the fleet. Lease revenue is expected to be higher in 2025, resulting from more railcars on lease and higher lease rates.
This discussion does not include the comparison of prior year 2022 to 2021 financial results, which can be found in the Management's Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022 , as filed with the SEC on February 16, 2023. 27 DISCUSSION OF OPERATING RESULTS The following table shows a summary of our reporting segments and consolidated financial results for the years ended December 31 (dollars in millions, except per share data): 2023 2022 2021 Segment Revenues Rail North America $ 982.7 $ 908.0 $ 891.7 Rail International 309.5 275.3 284.3 Portfolio Management 77.2 53.6 47.7 Other 41.5 36.1 33.7 $ 1,410.9 $ 1,273.0 $ 1,257.4 Segment Profit (Loss) Rail North America $ 307.3 $ 321.3 $ 285.4 Rail International 113.4 85.9 105.0 Portfolio Management 106.4 14.7 60.8 Other 29.2 (3.9) (1.3) 556.3 418.0 449.9 Less: Selling, general and administrative expense 212.7 195.0 198.3 Income taxes ($25.7, $12.3 and $55.3 related to affiliates' earnings) 84.4 67.1 108.5 Net Income (GAAP) $ 259.2 $ 155.9 $ 143.1 Net income, excluding tax adjustments and other items (non-GAAP) (1) $ 257.6 $ 217.7 $ 182.2 Diluted earnings per share (GAAP) $ 7.12 $ 4.35 $ 3.98 Diluted earnings per share, excluding tax adjustments and other items (non-GAAP) (1) $ 7.07 $ 6.07 $ 5.06 Return on equity (GAAP) 12.0 % 7.7 % 7.2 % Return on equity, excluding tax adjustments and other items (non-GAAP) (1) 12.0 % 10.8 % 9.2 % Investment Volume $ 1,665.0 $ 1,255.8 $ 1,131.9 _________ (1) See "Non-GAAP Financial Measures" at the end of this item for further details. 2023 Summary Net income was $259.2 million, or $7.12 per diluted share, for 2023 compared to $155.9 million, or $4.35 per diluted share, for 2022, and $143.1 million, or $3.98 per diluted share, for 2021.
This discussion does not include the comparison of prior year 2023 to 2022 financial results, which can be found in the Management's Discussion and Analysis of Financial Condition and Results of Operations in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023 , as filed with the SEC on February 16, 2024. 27 DISCUSSION OF OPERATING RESULTS The following table shows a summary of our reporting segments and consolidated financial results for the years ended December 31 (dollars in millions, except per share data): 2024 2023 2022 Segment Revenues Rail North America $ 1,099.0 $ 982.7 $ 908.0 Rail International 350.3 309.5 275.3 Engine Leasing 97.1 77.2 53.6 Other 39.1 41.5 36.1 $ 1,585.5 $ 1,410.9 $ 1,273.0 Segment Profit (Loss) Rail North America $ 356.0 $ 307.3 $ 321.3 Rail International 119.8 113.4 85.9 Engine Leasing 117.3 106.4 14.7 Other 12.9 29.2 (3.9) 606.0 556.3 418.0 Less: Selling, general and administrative expense 236.3 212.7 195.0 Income taxes ($25.5, $25.7 and $12.3 related to affiliates' earnings) 85.5 84.4 67.1 Net Income (GAAP) $ 284.2 $ 259.2 $ 155.9 Net income, excluding tax adjustments and other items (non-GAAP) (1) $ 288.1 $ 257.6 $ 217.7 Diluted earnings per share (GAAP) $ 7.78 $ 7.12 $ 4.35 Diluted earnings per share, excluding tax adjustments and other items (non-GAAP) (1) $ 7.89 $ 7.07 $ 6.07 Return on equity (GAAP) 12.1 % 12.0 % 7.7 % Return on equity, excluding tax adjustments and other items (non-GAAP) (1) 12.2 % 12.0 % 10.8 % Investment Volume $ 1,674.4 $ 1,665.0 $ 1,255.8 _________ (1) See "Non-GAAP Financial Measures" at the end of this item for further details. 2024 Summary Net income was $284.2 million, or $7.78 per diluted share, for 2024 compared to $259.2 million, or $7.12 per diluted share, for 2023, and $155.9 million, or $4.35 per diluted share, for 2022.
(4) Average active railcars for the year is calculated using the number of active railcars at the end of each month. As of December 31, 2023, leases for approximately 19,400 tank and freight cars and approximately 1,900 boxcars are scheduled to expire in 2024.
(4) Average active railcars for the year is calculated using the number of active railcars at the end of each month. As of December 31, 2024, leases for approximately 21,500 tank and freight cars and approximately 1,200 boxcars are scheduled to expire in 2025.
See the discussions of segment operating results sections in this Item for more detail. (2) Portfolio proceeds primarily consist of proceeds from sales of operating assets. (3) Short-term U.S. Treasury Obligations with an original maturity date of over 90 days.
See the discussions of segment operating results sections in this Item for more detail. (2) Portfolio proceeds primarily consist of proceeds from sales of operating assets. (3) Short-term U.S. Treasury obligations with an original maturity date of over 90 days. (4) Proceeds from sales of other assets for all periods were primarily related to railcar scrapping.
Utilization was 87.3% at December 31, 2023. 41 Trifleet Tank Container Data The following table shows fleet statistics for Trifleet's tank containers for the years ended December 31: 2023 2022 2021 Ending balance - owned and managed 23,931 21,999 19,996 Utilization rate at year-end - owned and managed (1) 87.3 % 93.1 % 89.2 % _______ (1) Utilization is calculated as the number of tank containers on lease as a percentage of total tank containers in the fleet.
Trifleet Tank Container Data The following table shows fleet statistics for Trifleet's owned and managed tank containers for the years ended December 31: 2024 2023 2022 Ending balance 25,041 23,931 21,999 Utilization rate at year-end (1) 84.7 % 87.3 % 93.1 % _______ (1) Utilization is calculated as the number of tank containers on lease as a percentage of total tank containers in the fleet.
Lease terms on renewals for cars in the LPI averaged 65 months in 2023 compared to 52 months in 2022. 32 The following table shows fleet activity and statistics for Rail North America boxcars for the years ended December 31: 2023 2022 2021 Beginning balance 8,663 12,946 14,315 Boxcars added 1,248 543 963 Boxcars scrapped (459) (230) (933) Boxcars sold (141) (4,596) (1,399) Ending balance 9,311 8,663 12,946 Utilization rate at year end (1) 100.0 % 99.9 % 99.7 % Active boxcars at year end (2) 9,310 8,657 12,909 Average active boxcars (3) 8,944 10,060 12,929 _______ (1) Utilization is calculated as the number of boxcars on lease as a percentage of total boxcars in the fleet.
Lease terms on renewals for railcars in the LPI averaged 60 months in 2024 compared to 65 months in 2023. 32 The following table shows fleet activity and statistics for Rail North America boxcars for the years ended December 31: 2024 2023 2022 Beginning balance 9,311 8,663 12,946 Boxcars added 587 1,248 543 Boxcars scrapped (1,343) (459) (230) Boxcars sold (160) (141) (4,596) Ending balance 8,395 9,311 8,663 Utilization rate at year end (1) 99.8 % 100.0 % 99.9 % Active boxcars at year end (2) 8,376 9,310 8,657 Average active boxcars (3) 9,059 8,944 10,060 _______ (1) Utilization is calculated as the number of boxcars on lease as a percentage of total boxcars in the fleet.
Financial results were not material to Rail International's segment profit. 34 The following table shows Rail International's segment results for the years ended December 31 (in millions): 2023 2022 2021 Revenues Lease revenue $ 296.6 $ 266.2 $ 272.9 Other revenue 12.9 9.1 11.4 Total Revenues 309.5 275.3 284.3 Expenses Maintenance expense 64.1 51.4 57.6 Depreciation expense 68.2 69.1 73.6 Other operating expense 10.4 8.3 9.0 Total Expenses 142.7 128.8 140.2 Other Income (Expense) Net gain (loss) on asset dispositions 7.0 (11.2) 2.7 Interest expense, net (56.2) (45.6) (45.2) Other (expense) income (4.2) (3.8) 3.4 Segment Profit $ 113.4 $ 85.9 $ 105.0 Investment Volume $ 382.4 $ 243.9 $ 173.3 GRE Fleet Data The following table shows fleet activity and statistics for GRE railcars for the years ended December 31: 2023 2022 2021 Beginning balance 28,005 27,109 26,343 Railcars added 1,695 1,211 1,131 Railcars scrapped or sold (484) (315) (365) Ending balance 29,216 28,005 27,109 Utilization rate at year end (1) 95.9 % 99.3 % 98.7 % Active railcars at year end (2) 28,004 27,801 26,754 Average active railcars (3) 27,947 27,288 26,240 _______ (1) Utilization is calculated as the number of railcars on lease as a percentage of total railcars in the fleet.
Financial results were not material to Rail International's segment profit. 34 The following table shows Rail International's segment results for the years ended December 31 (in millions): 2024 2023 2022 Revenues Lease revenue $ 333.6 $ 296.6 $ 266.2 Other revenue 16.7 12.9 9.1 Total Revenues 350.3 309.5 275.3 Expenses Maintenance expense 70.7 64.1 51.4 Depreciation expense 78.7 68.2 69.1 Other operating expense 17.4 10.4 8.3 Total Expenses 166.8 142.7 128.8 Other Income (Expense) Net gain (loss) on asset dispositions 4.5 7.0 (11.2) Interest expense, net (71.4) (56.2) (45.6) Other income (expense) 3.2 (4.2) (3.8) Segment Profit $ 119.8 $ 113.4 $ 85.9 Investment Volume $ 232.9 $ 382.4 $ 243.9 GRE Fleet Data The following table shows fleet activity and statistics for GRE railcars for the years ended December 31: 2024 2023 2022 Beginning balance 29,216 28,005 27,109 Railcars added 1,316 1,695 1,211 Railcars scrapped or sold (505) (484) (315) Ending balance 30,027 29,216 28,005 Utilization rate at year end (1) 96.1 % 95.9 % 99.3 % Active railcars at year end (2) 28,849 28,004 27,801 Average active railcars (3) 28,410 27,947 27,288 _______ (1) Utilization is calculated as the number of railcars on lease as a percentage of total railcars in the fleet.
Debt The following table shows the carrying value of our debt and lease obligations by major component as of December 31 (in millions): 2023 2022 Secured Unsecured Total Total Commercial paper and borrowings under bank credit facilities $ — $ 11.0 $ 11.0 $ 17.3 Recourse debt — 7,388.1 7,388.1 6,431.5 Operating lease obligations 226.8 — 226.8 257.9 Total $ 226.8 $ 7,399.1 $ 7,625.9 $ 6,706.7 As of December 31, 2023, our outstanding debt had a weighted-average remaining term of 8.4 years and a weighted-average interest rate of 4.08%, compared to 8.6 years and 3.72% at December 31, 2022.
Debt The following table shows the carrying value of our debt and lease obligations by major component as of December 31 (in millions): 2024 2023 Secured Unsecured Total Total Borrowings under bank credit facilities $ — $ 10.4 $ 10.4 $ 11.0 Recourse debt — 8,215.3 8,215.3 7,388.1 Operating lease obligations 180.0 — 180.0 226.8 Total $ 180.0 $ 8,225.7 $ 8,405.7 $ 7,625.9 As of December 31, 2024, our outstanding debt had a weighted-average remaining term of 8.6 years and a weighted-average interest rate of 4.59%, compared to 8.4 years and 4.08% at December 31, 2023.
The following table shows Rail North America's segment results for the years ended December 31 (in millions): 2023 2022 2021 Revenues Lease revenue $ 888.8 $ 826.0 $ 814.5 Other revenue 93.9 82.0 77.2 Total Revenues 982.7 908.0 891.7 Expenses Maintenance expense 276.6 238.5 235.4 Depreciation expense 265.9 258.6 261.1 Operating lease expense 36.0 36.1 39.2 Other operating expense 25.9 24.5 30.3 Total Expenses 604.4 557.7 566.0 Other Income (Expense) Net gain on asset dispositions 120.5 119.7 94.3 Interest expense, net (182.9) (144.6) (136.2) Other (expense) income (8.0) (4.6) 1.6 Share of affiliates' pre-tax (loss) earnings (0.6) 0.5 — Segment Profit $ 307.3 $ 321.3 $ 285.4 Investment Volume $ 976.9 $ 815.9 $ 574.4 The following table shows the components of Rail North America's lease revenue for the years ended December 31 (in millions): 2023 2022 2021 Railcars $ 805.5 $ 740.7 $ 720.0 Boxcars 57.2 59.5 67.9 Locomotives 26.1 25.8 26.6 Total $ 888.8 $ 826.0 $ 814.5 30 Rail North America Fleet Data The following table shows fleet activity and statistics for Rail North America railcars, excluding boxcars, for the years ended December 31: 2023 2022 2021 Beginning balance 100,954 101,570 103,745 Railcars added 4,653 3,712 3,371 Railcars scrapped (1,286) (2,133) (3,076) Railcars sold (3,154) (2,195) (2,470) Ending balance 101,167 100,954 101,570 Utilization rate at year end (1) 99.3 % 99.5 % 99.2 % Renewal success rate (2) 84.1 % 85.5 % 82.7 % Active railcars at year end (3) 100,498 100,396 100,719 Average active railcars (4) 100,217 100,444 100,769 _______ (1) Utilization is calculated as the number of railcars on lease as a percentage of total railcars in the fleet.
The following table shows Rail North America's segment results for the years ended December 31 (in millions): 2024 2023 2022 Revenues Lease revenue $ 983.5 $ 888.8 $ 826.0 Other revenue 115.5 93.9 82.0 Total Revenues 1,099.0 982.7 908.0 Expenses Maintenance expense 306.9 276.6 238.5 Depreciation expense 271.1 265.9 258.6 Operating lease expense 33.9 36.0 36.1 Other operating expense 26.4 25.9 24.5 Total Expenses 638.3 604.4 557.7 Other Income (Expense) Net gain on asset dispositions 132.8 120.5 119.7 Interest expense, net (232.1) (182.9) (144.6) Other expense (5.4) (8.0) (4.6) Share of affiliates' pre-tax (loss) earnings — (0.6) 0.5 Segment Profit $ 356.0 $ 307.3 $ 321.3 Investment Volume $ 1,162.4 $ 976.9 $ 815.9 The following table shows the components of Rail North America's lease revenue for the years ended December 31 (in millions): 2024 2023 2022 Railcars $ 888.9 $ 805.5 $ 740.7 Boxcars 64.7 57.2 59.5 Locomotives 29.9 26.1 25.8 Total $ 983.5 $ 888.8 $ 826.0 30 Rail North America Fleet Data The following table shows fleet activity and statistics for Rail North America railcars, excluding boxcars, for the years ended December 31: 2024 2023 2022 Beginning balance 101,167 100,954 101,570 Railcars added 5,359 4,653 3,712 Railcars scrapped (1,433) (1,286) (2,133) Railcars sold (2,127) (3,154) (2,195) Ending balance 102,966 101,167 100,954 Utilization rate at year end (1) 99.1 % 99.3 % 99.5 % Renewal success rate (2) 85.3 % 84.1 % 85.5 % Active railcars at year end (3) 102,003 100,498 100,396 Average active railcars (4) 101,392 100,217 100,444 _______ (1) Utilization is calculated as the number of railcars on lease as a percentage of total railcars in the fleet.
Accordingly, we believe presenting this information provides investors and other users of our financial statements with meaningful supplemental information for purposes of analyzing year-to-year financial performance on a comparable basis and assessing trends. 50 The following tables show our net income, diluted earnings per share, and return on equity, excluding tax adjustments and other items for the years ended December 31 (in millions, except per share data): Impact of Tax Adjustments and Other Items on Net Income: 2023 2022 2021 Net income (GAAP) $ 259.2 $ 155.9 $ 143.1 Adjustments attributable to consolidated pre-tax income: Loss on Specialized Gas Vessels at Portfolio Management (1) $ 4.0 $ 34.3 $ — Net (gain) loss on Rail Russia at Rail International (2) (0.3) 14.6 — Environmental remediation costs (3) — 5.9 — Net insurance proceeds (4) — — (5.3) Debt extinguishment costs (5) — — 4.5 Total adjustments attributable to consolidated pre-tax income $ 3.7 $ 54.8 $ (0.8) Income taxes thereon, based on applicable effective tax rate $ — $ (1.5) $ 0.2 Other income tax adjustments attributable to consolidated income: Income tax rate changes (6) $ (3.0) $ (3.0) $ — Net operating loss valuation allowance adjustment (7) (2.3) — — Total other income tax adjustments attributable to consolidated income $ (5.3) $ (3.0) $ — Adjustments attributable to affiliates' earnings, net of taxes: Aircraft spare engine impairment at RRPF (8) $ — $ 11.5 $ — Income tax rate change (9) — — 39.7 Total adjustments attributable to affiliates' earnings, net of taxes $ — $ 11.5 $ 39.7 Net income, excluding tax adjustments and other items (non-GAAP) $ 257.6 $ 217.7 $ 182.2 51 Impact of Tax Adjustments and Other Items on Diluted Earnings per Share: 2023 2022 2021 Diluted earnings per share (GAAP) $ 7.12 $ 4.35 $ 3.98 Adjustments attributable to consolidated income, net of taxes: Loss on Specialized Gas Vessels at Portfolio Management (1) $ 0.11 $ 0.96 $ — Net (gain) loss on Rail Russia at Rail International (2) (0.01) 0.41 — Environmental remediation costs (3) — 0.12 — Net insurance proceeds (4) — — (0.11) Debt extinguishment costs (5) — — 0.09 Other income tax adjustments attributable to consolidated income: Income tax rate changes (6) (0.08) (0.08) — Net operating loss valuation allowance adjustment (7) (0.06) — — Adjustments attributable to affiliates' earnings, net of taxes: Aircraft spare engine impairment at RRPF (8) — 0.32 — Income tax rate change (9) — — 1.10 Diluted earnings per share, excluding tax adjustments and other items (non-GAAP)* $ 7.07 $ 6.07 $ 5.06 (*) Sum of individual components may not be additive due to rounding. _______ (1) In 2022, we made the decision to sell the Specialized Gas Vessels.
Accordingly, we believe presenting this information provides investors and other users of our financial statements with meaningful supplemental information for purposes of analyzing year-to-year financial performance on a comparable basis and assessing trends. 51 The following tables show our net income, diluted earnings per share, and return on equity, excluding tax adjustments and other items for the years ended December 31 (in millions, except per share data): Impact of Tax Adjustments and Other Items on Net Income: 2024 2023 2022 Net income (GAAP) $ 284.2 $ 259.2 $ 155.9 Adjustments attributable to consolidated pre-tax income: Litigation claims settlements (1) $ 3.3 $ — $ — Environmental reserves (2) 10.7 — 5.9 Net (gain) loss on Specialized Gas Vessels at Engine Leasing (3) (0.6) 4.0 34.3 Net (gain) loss on Rail Russia at Rail International (4) — (0.3) 14.6 Total adjustments attributable to consolidated pre-tax income $ 13.4 $ 3.7 $ 54.8 Income taxes thereon, based on applicable effective tax rate $ (3.5) $ — $ (1.5) Other income tax adjustments attributable to consolidated income: Income tax rate changes (5) $ (6.0) $ (3.0) $ (3.0) Net operating loss valuation allowance adjustment (6) — (2.3) — Total other income tax adjustments attributable to consolidated income $ (6.0) $ (5.3) $ (3.0) Adjustments attributable to affiliates' earnings, net of taxes: Aircraft spare engine impairment at RRPF (7) $ — $ — $ 11.5 Total adjustments attributable to affiliates' earnings, net of taxes $ — $ — $ 11.5 Net income, excluding tax adjustments and other items (non-GAAP) $ 288.1 $ 257.6 $ 217.7 52 Impact of Tax Adjustments and Other Items on Diluted Earnings per Share: 2024 2023 2022 Diluted earnings per share (GAAP) $ 7.78 $ 7.12 $ 4.35 Adjustments attributable to consolidated income, net of taxes: Litigation claims settlements (1) $ 0.07 $ — $ — Environmental reserves (2) 0.22 — 0.12 Net (gain) loss on Specialized Gas Vessels at Engine Leasing (3) (0.02) 0.11 0.96 Net (gain) loss on Rail Russia at Rail International (4) — (0.01) 0.41 Other income tax adjustments attributable to consolidated income: Income tax rate changes (5) (0.16) (0.08) (0.08) Net operating loss valuation allowance adjustment (6) — (0.06) — Adjustments attributable to affiliates' earnings, net of taxes: Aircraft spare engine impairment at RRPF (7) — — 0.32 Diluted earnings per share, excluding tax adjustments and other items (non-GAAP)* $ 7.89 $ 7.07 $ 6.07 (*) Sum of individual components may not be additive due to rounding. _______ (1) Expenses recorded for the settlements of litigation claims arising out of legacy business operations.
Segment profit in 2023 included a $0.3 million disposition gain recorded as a result of the decision to exit the Rail Russia business. Segment profit in 2022 included a $14.6 million impairment charge recorded as a result of the decision to exit the Rail Russia business. Excluding these items, results for Rail International were $12.6 million higher than 2022.
Segment profit in 2023 included a $0.3 million disposition gain recorded as a result of the decision to exit the Rail Russia business. Excluding this item, results for Rail International were $6.7 million higher than 2023.
The following table shows the components of recourse leverage as of December 31 (in millions, except recourse leverage ratio): 2023 2022 2021 Debt and lease obligations, net of unrestricted cash and short-term investments: Unrestricted cash and short-term investments $ (450.7) $ (452.2) $ (344.3) Commercial paper and bank credit facilities 11.0 17.3 18.1 Recourse debt 7,388.1 6,431.5 5,887.5 Operating lease obligations 226.8 257.9 286.2 Finance lease obligations — — 1.5 Total debt and lease obligations, net of unrestricted cash and short-term investments $ 7,175.2 $ 6,254.5 $ 5,849.0 Total recourse debt (1) $ 7,175.2 $ 6,254.5 $ 5,849.0 Shareholders' Equity $ 2,273.0 $ 2,029.6 $ 2,019.2 Recourse Leverage (2) 3.2 3.1 2.9 ________ (1) Includes recourse debt, commercial paper and bank credit facilities, and operating and finance lease obligations, net of unrestricted cash and short-term investments.
The following table shows the components of recourse leverage as of December 31 (in millions, except recourse leverage ratio): 2024 2023 2022 Debt and lease obligations, net of unrestricted cash and short-term investments: Unrestricted cash and short-term investments $ (401.6) $ (450.7) $ (452.2) Borrowings under bank credit facilities 10.4 11.0 17.3 Recourse debt 8,215.3 7,388.1 6,431.5 Operating lease obligations 180.0 226.8 257.9 Total debt and lease obligations, net of unrestricted cash and short-term investments $ 8,004.1 $ 7,175.2 $ 6,254.5 Total recourse debt (1) $ 8,004.1 $ 7,175.2 $ 6,254.5 Shareholders' Equity $ 2,438.9 $ 2,273.0 $ 2,029.6 Recourse Leverage (2) 3.3 3.2 3.1 ________ (1) Includes recourse debt, borrowings under bank credit facilities, and operating and finance lease obligations, net of unrestricted cash and short-term investments.
(2) Active locomotives refers to the number of locomotives on lease to customers. Changes in locomotives on lease compared to prior years are impacted by locomotives that were sold or scrapped, as well as the fleet utilization rate.
(2) Active locomotives refers to the number of locomotives on lease to customers. Changes in locomotives on lease compared to prior years are impacted by locomotives that were sold or scrapped, as well as the fleet utilization rate. (3) Average active locomotives for the year is calculated using the number of active locomotives at the end of each month.
During 2023, we repurchased 24,520 shares of common stock for $2.6 million, excluding commissions, compared to 472,609 shares repurchased for $47.2 million, excluding commissions, in 2022. As of December 31, 2023, $87.1 million remained available under the repurchase authorization.
During 2024, we repurchased 167,452 shares of common stock for $21.9 million, excluding commissions, compared to 24,520 shares repurchased for $2.6 million, excluding commissions, in 2023. As of December 31, 2024, $65.1 million remained available under the repurchase authorization.
We plan to fund these expenditures in 2024 using available cash at December 31, 2023 in combination with cash from operations, portfolio proceeds, and long-term debt issuances. We also have access to our revolving credit facilities if needed.
We plan to fund these expenditures in 2025 using available cash at December 31, 2024 in combination with cash from operations, portfolio proceeds, and long-term debt issuances. We also have access to our revolving credit facilities if needed. Based on the available sources of liquidity, we also expect to meet our funding needs beyond 2025.
Segment profit excludes selling, general and administrative expenses, income taxes, and certain other amounts not allocated to the segments. 29 RAIL NORTH AMERICA Segment Summary The railcar leasing environment in North America remains robust, and demand for existing railcars was strong for most railcar types throughout 2023.
Segment profit excludes selling, general and administrative expenses, income taxes, and certain other amounts not allocated to the segments. 29 RAIL NORTH AMERICA Segment Summary The railcar leasing environment was favorable as demand for existing railcars remained steady.
In 2023, fluctuations in the value of the euro, relative to the U.S. dollar, positively impacted lease revenue by approximately $7.4 million and segment profit, excluding other income (expense), by approximately $2.7 million compared to 2022. 37 Segment Profit In 2023, segment profit of $113.4 million increased 32.0% compared to $85.9 million in 2022.
In 2024, fluctuations in the value of the euro, relative to the U.S. dollar, positively impacted lease revenue by approximately $0.6 million and negatively impacted segment profit, excluding other income (expense), by approximately $1.7 million compared to 2023. Segment Profit In 2024, segment profit of $119.8 million increased 5.6% compared to $113.4 million in 2023.
This amount excludes railcars on leases expiring in 2024 that have already been renewed or assigned to a new lessee. \ 36 Rail India Fleet Data The following table shows fleet activity and statistics for Rail India railcars for the years ended December 31: 2023 2022 2021 Beginning balance 5,872 4,830 4,156 Railcars added 2,933 1,042 715 Railcars scrapped or sold — — (41) Ending balance 8,805 5,872 4,830 Utilization rate at year end (1) 100.0 % 100.0 % 100.0 % Active railcars at year end (2) 8,805 5,872 4,830 Average active railcars (3) 7,082 5,395 4,326 _______ (1) Utilization is calculated as the number of railcars on lease as a percentage of total railcars in the fleet.
Rail India Fleet Data The following table shows fleet activity and statistics for Rail India railcars for the years ended December 31: 2024 2023 2022 Beginning balance 8,805 5,872 4,830 Railcars added 1,783 2,933 1,042 Railcars scrapped or sold (5) — — Ending balance 10,583 8,805 5,872 Utilization rate at year end (1) 100.0 % 100.0 % 100.0 % Active railcars at year end (2) 10,583 8,805 5,872 Average active railcars (3) 9,841 7,082 5,395 _______ (1) Utilization is calculated as the number of railcars on lease as a percentage of total railcars in the fleet.
The following table shows portfolio investments and capital additions by segment for the years ended December 31 (in millions): 2023 2022 2021 Rail North America $ 976.9 $ 815.9 $ 574.4 Rail International 382.4 243.9 173.3 Portfolio Management 267.3 149.7 353.0 Other 38.4 46.3 31.2 Total $ 1,665.0 $ 1,255.8 $ 1,131.9 The increase in portfolio investments and capital additions of $409.2 million in the year ended December 31, 2023 is primarily due to more railcars acquired at Rail North America and Rail International and more aircraft spare engines acquired at GEL, partially offset by fewer tank containers acquired at Trifleet.
The following table shows portfolio investments and capital additions by segment for the years ended December 31 (in millions): 2024 2023 2022 Rail North America $ 1,162.4 $ 976.9 $ 815.9 Rail International 232.9 382.4 243.9 Engine Leasing 260.8 267.3 149.7 Other 18.3 38.4 46.3 Total $ 1,674.4 $ 1,665.0 $ 1,255.8 The increase in portfolio investments and capital additions of $9.4 million in the year ended December 31, 2024 was primarily due to more railcars and locomotives acquired at Rail North America, partially offset by fewer railcars acquired at GRE and Rail India, and fewer tank containers acquired at Trifleet.
The remaining 9,000 railcars, which can be a mix of freight and tank cars, will be ordered at a rate of 1,500 railcars per order year from 2023 to 2028 and delivered under a schedule to be determined. At December 31, 2023, 2,995 railcars have been ordered pursuant to the terms of the agreement, of which 890 have been delivered.
The remaining 9,000 railcars, which can be a mix of freight and tank cars, are expected to be ordered at a rate of 1,500 railcars per order year from 2023 to 2028 and delivered under a schedule to be determined.
We have recorded gains and losses associated with the subsequent impairments and sales of these assets. (2) In 2022, we made the decision to exit Rail Russia and recorded losses in 2022 associated with the impairment of the net assets.
We have recorded gains and losses associated with the subsequent impairments and sales of these assets. As of December 31, 2023, all vessels had been sold. (4) In 2022, we made the decision to exit Rail Russia and recorded losses in 2022 associated with the impairment of the net assets.
During 2023, GEL acquired ten aircraft spare engines compared to five aircraft spare engines in 2022 . OTHER Other comprises our Trifleet business, as well as selling, general and administrative expenses ("SG&A"), unallocated interest expense, miscellaneous income and expense not directly associated with the reporting segments, and certain eliminations.
OTHER Other comprises our Trifleet business, as well as selling, general and administrative expenses ("SG&A"), unallocated interest expense, miscellaneous income and expense not directly associated with the reporting segments, and certain eliminations.
CHANGE IN NET OPERATING ASSETS AND FACILITIES The following table shows changes in net operating assets and facilities as of December 31 (in millions): 2023 2022 Beginning balance $ 8,250.3 $ 7,784.8 Investments 1,622.2 1,215.5 Purchase of assets previously leased — 1.5 Depreciation expense (385.6) (365.0) Asset dispositions (149.9) (130.9) Transfers to assets held for sale (1.7) (116.0) Foreign exchange rate effects 87.1 (111.7) Other (11.2) (27.9) Ending balance $ 9,411.2 $ 8,250.3 CASH FLOW DISCUSSION We generate a significant amount of cash from operating activities and investment portfolio proceeds.
Income Taxes" in Part II, Item 8 of this Form 10-K for additional information on income taxes. 42 CHANGE IN NET OPERATING ASSETS AND FACILITIES The following table shows changes in net operating assets and facilities as of December 31 (in millions): 2024 2023 Beginning balance $ 9,411.2 $ 8,250.3 Investments 1,665.3 1,622.2 Purchase of assets previously leased 29.4 — Depreciation expense (414.2) (385.6) Asset dispositions (129.6) (149.9) Transfers to assets held for sale (2.6) (1.7) Foreign exchange rate effects (120.9) 87.1 Other 11.1 (11.2) Ending balance $ 10,449.7 $ 9,411.2 CASH FLOW DISCUSSION We generate a significant amount of cash from operating activities and investment portfolio proceeds.
Based on the available sources of liquidity, we also expect to meet our funding needs beyond 2024. 45 Contractual Cash Receipts Information regarding our contractual cash receipts arising from future rental receipts from noncancelable operating leases and from our finance leases as of December 31, 2023 is presented in "Note 6. Leases" within Item 8 of this Form 10-K.
Contractual Cash Receipts Information regarding our contractual cash receipts arising from future rental receipts from noncancelable operating leases and from our finance leases as of December 31, 2024 is presented in "Note 6. Leases" within Item 8 of this Form 10-K.
As of December 31, 2023, our funded pension plans in the aggregate were 102.4% funded.
As of December 31, 2024, our funded pension plans in the aggregate were 106.8% funded.
Our rail operations in India ("Rail India") achieved strong operating results and continued to grow and diversify its fleet during 2023. Rail India continued to focus on investment opportunities, diversification of its fleet, and developing relationships with customers, suppliers and the Indian Railways. Demand for railcars in India was robust, driven by continued growth in the economy and infrastructure development.
The fleet size of our rail business in India ("Rail India") surpassed 10,000 railcars in 2024, and Rail India continued to focus on investment opportunities, diversification of its fleet, and developing relationships with customers, suppliers and the Indian Railways. Demand for railcars in India remained strong, driven by continued growth in the economy and infrastructure development.
In 2022, we made the decision to sell the Specialized Gas Vessels and recorded impairment losses totaling $34.3 million and sold two vessels. In 2023, we sold the remaining three vessels and recorded net losses of $4.0 million. In 2023, Portfolio Management sold its natural gas holdings and recorded a gain of $5.7 million.
In 2022, we made the decision to sell the Specialized Gas Vessels and recorded impairment losses totaling $34.3 million and sold two vessels. In 2023, we sold the remaining three vessels and recorded net losses of $4.0 million. In 2024, we recorded final gains of $0.6 million associated with the Specialized Gas Vessels.
Expenses In 2023, marine operating expense decreased $7.6 million, due to sale of the Specialized Gas Vessels in 2022 and 2023. Depreciation expense increased $10.5 million, due to new aircraft spare engines acquired in 2022 and 2023, offset by the absence of depreciation expense on the Specialized Gas Vessels classified as held for sale in 2022.
Expenses In 2024, marine operating expense decreased $6.5 million, due to sale of the Specialized Gas Vessels in 2023. Depreciation expense increased $9.5 million, due to aircraft spare engines acquired in 2023 and 2024.
Net Cash Provided by Financing Activities The following table shows our principal sources and uses of cash flows provided by financing activities for the years ended December 31 (in millions): 2023 2022 2021 Net proceeds from issuances of debt (original maturities longer than 90 days) $ 1,420.0 $ 848.3 $ 1,491.9 Repayments of debt (original maturities longer than 90 days) (500.0) (250.0) (884.0) Net decrease in debt with original maturities of 90 days or less (7.1) — (4.1) Purchases of assets previously leased (1) — (1.5) (77.2) Stock repurchases (2) (2.6) (47.2) (13.1) Dividends (80.6) (76.6) (74.3) Other 14.4 31.4 23.9 Total $ 844.1 $ 504.4 $ 463.1 ________ (1) We did not purchase any railcars that were previously leased in 2023, compared to 21 railcars in 2022.
Portfolio proceeds decreased $42.2 million in 2024 compared to 2023, resulting from the absence of proceeds from the sale of three Specialized Gas Vessels at Engine Leasing and the sale of Rail Russia at Rail International in 2023. 44 Net Cash Provided by Financing Activities The following table shows our principal sources and uses of cash flows provided by financing activities for the years ended December 31 (in millions): 2024 2023 2022 Net proceeds from issuances of debt with original maturities longer than 90 days $ 1,295.6 $ 1,420.0 $ 848.3 Repayments of debt with original maturities longer than 90 days (413.5) (500.0) (250.0) Net decrease in debt with original maturities of 90 days or less — (7.1) — Purchases of assets previously leased (1) (30.4) — (1.5) Stock repurchases (2) (21.9) (2.6) (47.2) Dividends (84.8) (80.6) (76.6) Other 25.5 14.4 31.4 Net cash provided by financing activities $ 770.5 $ 844.1 $ 504.4 ________ (1) In 2024, we purchased 728 railcars that were previously leased, compared to zero railcars in 2023.
In 2022, GATX executed a multi-party amended and restated settlement agreement related to its share of estimated environmental remediation costs to be incurred at a previously owned facility that was sold in 1974. As a result, GATX recorded $5.9 million of expense to establish a reserve for its share of the remaining anticipated remediation and related costs.
In 2022, GATX executed a multi-party amended and restated settlement agreement related to its share of estimated environmental remediation costs to be incurred at a facility that GATX sold in 1974.
Non-dedicated engine revenue increased $36.1 million due to more aircraft spare engines utilized in the engine capacity agreement with Rolls-Royce as a result of acquisitions. Marine operating revenue decreased $12.0 million, driven by the sale of the Specialized Gas Vessels in 2022 and 2023.
Non-dedicated engine revenue increased $27.0 million, primarily due to aircraft spare engines acquired in 2023 and 2024 and utilized in the engine capacity agreement with Rolls-Royce. Marine operating revenue decreased $6.9 million, driven by the final sales of the Specialized Gas Vessels in 2023.
Segment profit included earnings from the RRPF affiliates of $98.7 million for 2023, $45.4 million for 2022, and $56.5 million for 2021. In 2022, RRPF recorded an impairment charge associated with aircraft spare engines in Russia that RRPF does not expect to recover. GATX's 50% share of this net impairment was $15.3 million ($11.5 million after tax).
In 2022, RRPF recorded an impairment charge associated with aircraft spare engines in Russia that RRPF does not expect to recover. GATX's 50% share of this net impairment was $15.3 million ($11.5 million after tax). GATX did not make any additional investment in the RRPF affiliates in 2024, 2023, or 2022.
Finally, we anticipate interest expense to be higher in 2024 compared to what we experienced in 2023. . • Rail International's segment profit in 2024 is expected to increase from 2023, driven by continued growth in both our European and India lease fleets.
Finally, we anticipate interest expense and depreciation to be higher in 2025 compared to 2024. • Rail International's segment profit in 2025 is expected to increase from 2024, driven by continued growth of the fleet sizes in Europe and India.
As of December 31, 2023, GEL owned 29 aircraft spare engines, with 14 on long-term leases with airline 38 customers and 15 that are employed in an engine capacity agreement with Rolls-Royce for use in its engine maintenance programs. All engines at GEL are managed by the RRPF affiliates. Portfolio Management previously owned the Specialized Gas Vessels.
As of December 31, 2024, GEL owned 39 aircraft spare engines, with 14 on long-term leases with airline customers and 25 that are employed in an engine capacity agreement with Rolls-Royce for use in its engine maintenance programs.
The increase was primarily due to higher lease revenue from more railcars on lease and higher lease rates, partially offset by higher maintenance and interest expenses. Revenues In 2023, lease revenue increased $30.4 million, or 11.4%, due to more railcars on lease and higher lease rates at GRE and Rail India and the impact of foreign exchange rates.
The increase was primarily due to more railcars on lease and higher lease rates at both GRE and Rail India, partially offset by higher interest expense and higher maintenance expense at GRE. Revenues In 2024, lease revenue increased $37.0 million, or 12.5%, due to more railcars on lease and higher lease rates at GRE and Rail India.
Financial results for our tank container leasing business ("Trifleet") are reported in the Other segment. In 2023, we sold our rail business in Russia ("Rail Russia") . See "Note 10. Asset Impairments and Assets Held for Sale" in Part II, Item 8 of this Form 10-K for further information.
In 2023, we sold our rail business in Russia ("Rail Russia") . See "Note 10. Asset Impairments and Assets Held for Sale" in Part II, Item 8 of this Form 10-K for further information. In 2023, we sold the three remaining liquefied gas-carrying vessels (the "Specialized Gas Vessels") within the Engine Leasing segment. We sold two vessels in 2022.
Net Cash Used in Investing Activities The following table shows our principal sources and uses of cash flows from investing activities for the years ended December 31 (in millions): 2023 2022 2021 Portfolio investments and capital additions (1) $ (1,665.0) $ (1,255.8) $ (1,131.9) Portfolio proceeds (2) 272.8 269.6 187.1 Short-term investments (3) 150.0 (148.5) — Other investing activity 22.9 61.2 27.1 Net cash used in investing activities $ (1,219.3) $ (1,073.5) $ (917.7) _______ (1) Portfolio investments and capital additions primarily consist of purchases of operating assets and capitalized asset improvements.
Specifically, higher cash receipts from revenue, higher affiliate dividends received, and lower payments for operating leases were partially offset by higher cash payments for maintenance, interest, and other operating expenses, as well as higher payments for income taxes. 43 Net Cash Used in Investing Activities The following table shows our principal sources and uses of cash flows from investing activities for the years ended December 31 (in millions): 2024 2023 2022 Portfolio investments and capital additions (1) $ (1,674.4) $ (1,665.0) $ (1,255.8) Portfolio proceeds (2) 230.6 272.8 269.6 Short-term investments (3) — 150.0 (148.5) Proceeds from sales of other assets (4) 24.9 20.2 31.1 Other investing activity 2.2 2.7 30.1 Net cash used in investing activities $ (1,416.7) $ (1,219.3) $ (1,073.5) _______ (1) Portfolio investments and capital additions primarily consist of purchases of operating assets and capitalized asset improvements.
The following table shows components of Other for the years ended December 31 (in millions): 2023 2022 2021 Trifleet revenue $ 41.5 $ 36.1 $ 33.7 Trifleet segment profit $ 13.4 $ 13.8 $ 10.2 Unallocated interest income (expense) 12.7 1.1 (0.5) Other income (expense), including eliminations 3.1 (18.8) (11.0) Segment Profit (Loss) $ 29.2 $ (3.9) $ (1.3) Selling, general and administrative expense $ 212.7 $ 195.0 $ 198.3 Investment Volume $ 38.4 $ 46.3 $ 29.8 Trifleet Summary The tank container leasing market experienced softer demand across certain regions in 2023, with some customers postponing tank container fleet decisions.
As a result, GATX recorded $5.9 million of expense to establish a reserve for its share of the remaining anticipated remediation and related costs. 41 The following table shows components of Other for the years ended December 31 (in millions): 2024 2023 2022 Trifleet revenue $ 39.1 $ 41.5 $ 36.1 Trifleet segment profit $ 8.3 $ 13.4 $ 13.8 Unallocated interest income 12.8 12.7 1.1 Other (expense) income, including eliminations (8.2) 3.1 (18.8) Segment Profit (Loss) $ 12.9 $ 29.2 $ (3.9) Selling, general and administrative expense $ 236.3 $ 212.7 $ 195.0 Investment Volume $ 18.3 $ 38.4 $ 46.3 Trifleet Summary The tank container leasing market remained challenging in 2024.
Other Income (Expense) In 2023, net gain (loss) on asset dispositions was favorable by $33.3 million, driven by lower impairment losses recorded in 2023 for the Specialized Gas Vessels as well as the sale of the natural gas holdings in 2023.
Other Income (Expense) In 2024, net gain (loss) on asset dispositions was unfavorable by $1.6 million, driven by the absence of gains recorded in 2023 for the sale of natural gas holdings, partially offset by net gains in 2024 and net losses in 2023 associated with the Specialized Gas Vessels.
We also have a $250 million 3-year unsecured revolving credit facility in the United States that matures in 2026 and a $600 million, 5-year unsecured revolving credit facility in the United States that matures in 2028, both of which were fully available as of December 31, 2023. 42 The following table shows our cash flows from operating, investing and financing activities for the years ended December 31 (in millions): 2023 2022 2021 Net cash provided by operating activities $ 520.4 $ 533.5 $ 507.2 Net cash used in investing activities (1,219.3) (1,073.5) (917.7) Net cash provided by financing activities 844.1 504.4 463.1 Effect of exchange rate changes on cash and cash equivalents 1.6 (4.9) (1.8) Net cash provided by discontinued operations — — 1.1 Net increase (decrease) in cash, cash equivalents, and restricted cash during the year $ 146.8 $ (40.5) $ 51.9 Net Cash Provided by Operating Activities Net cash provided by operating activities in 2023 of $520.4 million decreased $13.1 million compared to 2022.
The following table shows our cash flows from operating, investing and financing activities for the years ended December 31 (in millions): 2024 2023 2022 Net cash provided by operating activities $ 602.1 $ 520.4 $ 533.5 Net cash used in investing activities (1,416.7) (1,219.3) (1,073.5) Net cash provided by financing activities 770.5 844.1 504.4 Effect of exchange rate changes on cash, cash equivalents, and restricted cash (4.9) 1.6 (4.9) Net (decrease) increase in cash, cash equivalents, and restricted cash during the year $ (49.0) $ 146.8 $ (40.5) Net Cash Provided by Operating Activities Net cash provided by operating activities in 2024 of $602.1 million increased $81.7 million compared to 2023.
Net interest expense increased $10.6 million, due to a higher average interest rate and a higher average debt balance. Other (expense) income was unfavorable $0.4 million, driven by the negative impact of changes in foreign exchange rates, primarily euro-zloty fluctuations, partially offset by lower litigation costs.
Net interest expense increased $15.2 million, due to a higher average interest rate and a higher average debt balance. Other income (expense) was favorable by $7.4 million, driven by the positive impact of changes in foreign exchange rates, primarily euro-zloty fluctuations. Investment Volume During 2024, investment volume was $232.9 million, compared to $382.4 million in 2023.
In India, we anticipate significant growth again in our fleet this coming year, which will also contribute to an increase in segment profit. • We anticipate Portfolio Management's segment profit in 2024 to be higher than 2023.
In India, we anticipate significant growth again in our fleet this coming year, which will also contribute to an increase in segment profit. • We anticipate Engine Leasing's segment profit in 2025 to be higher than 2024. We expect an increase in segment profit from GEL as a result of additional aircraft spare engines acquired during 2024.
SG&A, Unallocated Interest and Other SG&A increased $17.7 million in 2023, driven by higher employee-related expenses, including the impacts of share-based compensation expenses, higher legal costs, higher information technology expenses, and the impact of foreign exchange rates.
SG&A, Unallocated Interest and Other SG&A increased $23.6 million in 2024, driven by higher employee-related expenses, including higher share-based compensation expense, and higher information technology expenses.
The decrease was primarily attributable to higher maintenance and interest expenses, partially offset by higher lease revenue. • At Rail International, segment profit in 2023 was higher than prior year due to the absence of the impairment of Rail Russia recorded in the prior year and higher lease revenue from more railcars on lease and higher lease rates, partially offset by higher maintenance and interest expenses. • At Portfolio Management, segment profit in 2023 increased compared to prior year due to higher earnings at the RRPF affiliates, higher results from GATX Engine Leasing ("GEL") operations, and the impact of impairments recorded in 2022 and 2023 for the Specialized Gas Vessels and in 2022 for engines in Russia that RRPF does not expect to recover. 28 • Within Other, Trifleet's segment profit decreased due to higher maintenance and interest expenses, partially offset by higher lease revenue, resulting from more tank containers in the fleet, and higher repair revenue.
The increase was primarily attributable to higher lease revenue, higher net gain on asset dispositions, and higher repair revenue, partially offset by higher interest and maintenance expense. • At Rail International, segment profit in 2024 was higher than prior year, due to more railcars on lease and higher lease rates, partially offset by higher maintenance and interest expense. • At Engine Leasing, segment profit in 2024 increased compared to prior year, a result of higher earnings at the RRPF affiliates, higher earnings from GEL operations, and the absence of impairments recorded in 2023 for the Specialized Gas Vessels, partially offset by the absence of the gain on the sale of natural gas holdings recorded in 2023. 28 • Within Other, Trifleet's segment profit decreased, largely due to lower lease revenue, resulting from lower utilization, as well as higher interest expense and higher bad debt expense resulting from a settlement and restructuring agreement with a customer in the current year.
All railcars covered under this agreement are expected to be delivered by early 2024. 31 Lease Price Index Our Lease Price Index ("LPI") is an internally-generated business indicator that measures renewal activity for our North American railcar fleet, excluding boxcars.
At December 31, 2024, 5,392 railcars have been ordered pursuant to the terms of the agreement, of which 3,458 have been delivered. 31 Lease Price Index Our Lease Price Index ("LPI") is an internally-generated business indicator that measures renewal activity for our North American railcar fleet, excluding boxcars.
In 2023, we entered into an amendment to this facility to extend the maturity by one year from May 2027 to May 2028. As of December 31, 2023, the full $600 million was available under this facility. Additionally, we have a $250 million 3-year unsecured revolving credit facility in the United States.
The facility contains two one-year extension options. This replaced our prior $600 million, 5-year unsecured revolving credit facility. As of December 31, 2024, the full $600 million was available under this facility. We also entered into a $350 million 3-year unsecured revolving credit facility in the United States, expiring in May 2027. This facility contains two one-year extension options.
Other Income (Expense) In 2023, net gain on asset dispositions increased $0.8 million due to higher net remarketing gains, partially offset by lower net scrapping gains. The amount and timing of disposition gains is dependent on a number of factors and may vary materially from year to year.
The amount and timing of disposition gains is dependent on a number of factors and may vary materially from year to year. Net interest expense increased $49.2 million, due to a higher average interest rate and a higher average debt balance.
Other revenue increased $3.8 million, driven by higher repair revenue. Expenses In 2023, maintenance expense increased $12.7 million, primarily due to more repairs performed, higher costs for repairs, inflationary impacts, and the impact of foreign exchange rates.
Expenses In 2024, maintenance expense increased $6.6 million, primarily due to more repairs performed, and the impact of foreign exchange rates, partially offset by lower wheelset costs.
In 2023, we sold the three remaining liquefied gas-carrying vessels (the "Specialized Gas Vessels") within the Portfolio Management segment. We sold two vessels in 2022. The following discussion and analysis should be read in conjunction with the audited financial statements included in "Item 8. Financial Statements and Supplementary Data" in this Form 10-K.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the audited financial statements included in "Item 8. Financial Statements and Supplementary Data" in this Form 10-K.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeComparatively, based on 2022 local currency earnings and considering non-functional currency assets and liabilities recorded as of December 31, 2022, a uniform and hypothetical 10% strengthening in the U.S. dollar versus applicable foreign currencies would have decreased after-tax income in 2023 by $8.1 million. 53
Biggest changeComparatively, based on 2023 local currency earnings and considering non-functional currency assets and liabilities recorded as of December 31, 2023, a uniform and hypothetical 10% strengthening in the U.S. dollar versus applicable foreign currencies would have decreased after-tax income in 2024 by $9.7 million. 54
Based on 2023 local currency earnings and considering non-functional currency assets and liabilities recorded as of December 31, 2023, and giving effect to related derivatives, a uniform and hypothetical 10% strengthening in the U.S. dollar versus applicable foreign currencies would decrease after-tax income in 2024 by $9.7 million.
Based on 2024 local currency earnings and considering non-functional currency assets and liabilities recorded as of December 31, 2024, and giving effect to related derivatives, a uniform and hypothetical 10% strengthening in the U.S. dollar versus applicable foreign currencies would decrease after-tax income in 2024 by $9.6 million.
Comparatively, at December 31, 2022, a hypothetical 100 basis point increase in interest rates would have resulted in a $4.6 million increase in after-tax interest expense in 2023. Our earnings are also exposed to interest rate changes from affiliates' earnings. Certain affiliates issue floating rate debt instruments to finance their investments.
Comparatively, at December 31, 2023, a hypothetical 100 basis point increase in interest rates would have resulted in a $4.2 million increase in after-tax interest expense in 2024. Our earnings are also exposed to interest rate changes from affiliates' earnings. Certain affiliates issue floating rate debt instruments to finance their investments.
We generally manage the amount of floating rate debt exposure in order to reduce interest expense volatility. Based on our floating rate debt instruments at December 31, 2023, and giving effect to related derivatives, a hypothetical increase in market interest rates of 100 basis points would cause an increase in after-tax interest expense of $4.2 million in 2024.
We generally manage the amount of floating rate debt exposure in order to reduce interest expense volatility. Based on our floating rate debt instruments at December 31, 2024, and giving effect to related derivatives, a hypothetical increase in market interest rates of 100 basis points would cause an increase in after-tax interest expense of $5.3 million in 2024.

Other GATX 10-K year-over-year comparisons