Freight Railways

When Bob Billingsley hired on with Norfolk Southern railway 31 years ago, he was a rookie on work crews that were closing unused lines as the nation's economy turned its back on the railroads.

Now he's in charge of raising the roof of a Norfolk Southern tunnel in southwestern Virginia to clear headroom for the double-stacked container cars that have become the symbol of the industry's sudden surge, thanks to a confluence of powerful global factors.

"For years, we were looking for ways to cut costs to increase profits," Billingsley said. "Now, we're building business to increase profits."

The freight railway industry is enjoying its biggest building boom in nearly a century, a turnaround as abrupt as it is ambitious. It is largely fueled by growing global trade and rising fuel costs for semitrailer trucks. In 2002, the major railroads laid off 4,700 workers; in 2006, they hired more than 5,000. Profit has doubled industry-wide since 2003, and stock prices have soared. The value of the largest railroad, the Union Pacific, has tripled since 2001.

This year alone, the railroads will spend nearly $10 billion to add track, build switchyards and terminals, and open tunnels to handle the coming flood of traffic. Freight rail tonnage will rise nearly 90 percent by 2035, according to the Transportation Department.

In the 1970s, tight federal regulation, cheap truck fuel and a wide-open interstate highway system conspired to cripple the railroad industry, driving many lines into bankruptcy. The nation's 300,000 miles of rails became a web of slow-moving, poorly maintained lines, so dilapidated in spots that tracks would give way under standing trains.

The Staggers Rail Act of 1980 largely deregulated the industry, leading to a wave of consolidation. More than 40 major lines condensed into the seven that remain, running on 162,000 miles of track