Good day, ladies and gentlemen, welcome to the GATX Third Quarter Earnings Conference Call. Today’s conference is being recorded. At this time, I would like to turn things over to Ms. Jennifer Van Aken, Director of Investor Relations, please go ahead, ma’am.

Thank you, Erin, and good morning, everyone. Thank you for joining us for the third quarter conference call. With me today are Brian Kenney, President and CEO of GATX Corporation; and Bob Lyons, Senior Vice President and Chief Financial Officer. I will give a brief overview of the results provided in our press release earlier this morning and then we’ll open up for your questions. First, I’d like to remind you that any forward-looking statements made on this call represents our best judgment as to what may occur in the future. We have based these forward-looking statements on information currently available and disclaim any intention or obligation to update or revise these statements to reflect subsequent events or circumstances. The company’s actual results will depend on a number of competitive and economic factors, some of which may be outside the control of the company. For more information refer to our 2009, Form 10-K and the second quarter 2010 10-Q filings. Today we reported 2010 third quarter net income of $21.1 million or $0.45 per diluted share. This includes a net impact of negative $0.06 per diluted share related to the fair value adjustments of certain interest rate swaps at our European Rail Affiliate AAE Cargo, partially offset by a tax benefit of $0.04 per diluted share from a reduction of statutory tax rates in the UK. This compares to 2009 third quarter net income of $19.6 million or $0.42 per diluted share. Year-to-date 2010, we reported net income of $61.3 million or $1.31 per diluted share. The year-to-date results include a net benefit of $0.04 per diluted share related to a combination of the aforementioned tax benefits due to a change in tax rate, the favorable resolution of a litigation matter and tax accrual reversal that occurred in the second…

Thank you. (Operator Instructions). And we’ll hear first from John Hecht with JMP Securities. John Hecht – JMP Securities: Good morning and thanks for taking my questions. Real quick, with respect to the earnings in the affiliate revenue line it is $5.7 million, were there any one-time nonrecurring losses at some of your affiliates? And, if so, can you give us a sense of what maybe the core run rate excluding that type of event would have been in the affiliate line item?

John, its Bob Lyons. The main item in the third quarter was the AAE derivative for $2.8 million as a negative that would flow through that line. So that would be the only adjustment. John Hecht – JMP Securities: Okay, so is it normalized run rate then closer to $8-ish million or $8 million to $9 million in that line item?

Normalizing this quarter that’s correct. But keep in mind too there is also from time-to-time some of the marketing income that flowed through at the JV level. So that number can also bounce around with that. John Hecht – JMP Securities: And do you have that remarketing this quarter that flowed through that line item?

There were no remarketing events at the JV of any significance this quarter. John Hecht – JMP Securities: Okay. So $8 million to $9 million plus upside from remarketing using this quarter as a basis.

Sure. John Hecht – JMP Securities: Okay. On the capital deployment side, you highlighted in the car – in the prepared marks that you’re seeing more opportunities. Can you characterize these if you know they’re small across various geographies, are there any large opportunities, can you characterize it by asset type anything of that nature?

Sure, it’s Brian, I can do that. On the rail side, we’re seeing new car opportunities, we’ve seen it through the second half, probably starting at the end of the first quarter, seeing more a new car opportunities on the rail side, and that’s pretty broad based growth rate multi-covered hoppers, some tanks. We closed Adler in third quarter, which is an investment, once again a rail investment of a distressed fleet. In general, we’re seeing more opportunities across the board. If secondary markets improves, the economy improves slightly, and people were finally willing to part with [inaudible]. John Hecht – JMP Securities: So it’s generally across the board in various geographies.

Yes. John Hecht – JMP Securities: Okay. On the Adler transaction, is it true that you guys just put in equity? Are you going to – is there a levered return that we should be thinking about or is it unlevered returns were attractive enough given the pricing to get you guys interested?

Well, what this really comes down to is – sorry we’re having a little problem. But what it comes down to is we purchased about – it was a $36 million stake, about 12.5% of a new company, as Jennifer said, it’s 5,300 rail cars. The way we look at it is it was a troubled fleet where we can add significant value, so we don’t do it for the management fee at all. We don’t think you can earn a decent return there. What we do is take advantage of the situation where the fleet is struggling. We think we can enhance the fleet’s future performance considerably from a utilization perspective or rate perspective, maintenance cost, free marketing all of that. And our return really will come from three sources. The obvious one is the share of the ongoing earnings of Adler. The second one would be the fee that we earned from managing the fleet, but the third and most importantly is we can earn an incentive fee upon successful liquidation or residue realization of that portfolio. So that’s really why we do it, because we think we can add value to the fleet and capture that upside in an outsize manner. John Hecht – JMP Securities: Okay, and final question. What was the renewal success rate during the quarter?

It was approximately 61%. John Hecht – JMP Securities: Okay, so that’s an improvement from the last few quarters.

It is running around the mid-50s. John Hecht – JMP Securities: Okay, great. Thank you guys very much.

Our next question comes from Art Hatfield with Morgan Keegan. Art Hatfield – Morgan Keegan: Good morning everyone. Just a couple of questions, just so I’m clear on this. On the earnings guidance, the $1.50 to $1.70 you talk about that being based on what you’ve reported today excluding the items noted above. So I should – we should be using a $0.47 number in Q3. Is that correct?

That’s right. Art Hatfield – Morgan Keegan: Okay. Moving onto Adler real quick, is that – you talked, Brian you talked about being able to sell stuff out of the fleet, but is there an instance where Adler would grow and you may have additional capital injections into that company?

No, that’s not the objective. The objective is to improve the performance of the fleet and eventually get the residual realization to an attractive level. Art Hatfield – Morgan Keegan: Okay.

There may be a point in the future where select carves out of that portfolio GATX might buy but it’s really, it’s more of a static portfolio that we’ll manage proactively and liquidate over time. Art Hatfield – Morgan Keegan: Got it, got it. No that’s helpful. And then as you think about this going forward and you’ve talked a lot about these opportunities like you’ve been able to do here with Adler and that there could be more opportunities. If the market improves, are enough of these portfolios in a bad enough shape that they’re really not in a position where they’ll ever recover and they will need to do sell out at some point or can the market recover and get these guys good enough help where these opportunities will go away as things get better?

The way I think about it if you look two years ago, we took down the Alcoa (ph) portfolio as the market was descending and now we’re starting to have a little bit more successes as being example as the market recovers. And I think people didn’t want to let go with the bottom because they didn’t like the valuations in not many people. They didn’t think many people would show up at their sales process. And I think more opportunities will come up and they will probably come up as the market recovers. Art Hatfield – Morgan Keegan: Okay. Would you characterize this, you may not want to answer this but I’m going to ask it anyways, the valuation on this did you think you got a better deal here or on Alcoa (ph)?

I probably shouldn’t answer. I think it’s an attractive valuation. Art Hatfield – Morgan Keegan: Okay.

In both cases. Art Hatfield – Morgan Keegan: That’s fair enough. Thanks for your time as always.

And next we’ll go to Mike Grondahl with Northland Capital Markets. Mike Grondahl – Northland Capital Markets: Yes, couple of questions guys. First, on the $1.50 to $1.70. Can you just give us the comparable year-to-date number where you are so far, just so we know we’re talking about apples-and-apples? And then secondly Brain, could you help us think about lease income? It was $260 million, a little bit of a lift in the September quarter, kind of how you’re thinking about that in the next several quarters. What’s kind of the plusses and the minuses?

Yes Mike, you first question. The comparable year-to-date number that we’re looking at is $1.27. Mike Grondahl – Northland Capital Markets: Okay, great. And it’s where I was at. Thanks.

As far as thinking about lease income going forward, let’s say it’s driven by rail. It’s close to 90% of our portfolio. And revenue pressure continues in the rail business. You saw the LPI in the quarter. If you look even ahead to 2011 as far as the expiring rate on these leases that we’re renewing, it’s very similar to the 2010 levels. Remember, we’re now in the process of renewing leases or assigning cars as leases renew to really from cars that were put on at the peak of the market. And that will be the case throughout 2011 and therefore that revenue pressure will continue Mike. Mike Grondahl – Northland Capital Markets: Do you, I mean can you give us some sense of magnitude, I mean its 216 is not the floor. Is that what you’re saying?

That pressure that Brian referenced Mike is it’s a little bit hard to quantify but we don’t know exactly what’s going to happen in the marketplace. But those negative comps are going to continue well into 2011 and then it should start to abate. The hurdle rates should start to come down so to speak. But in the last couple of quarters we’ve been riding around that 214, 215 range. Mike Grondahl – Northland Capital Markets: Right.

The reason it’s far down also we don’t know what additions to the fleet we’ll be making. So I’d say as on the existing fleet, the revenue pressure continues in 2011. It will be offset by how successful we are in growing the fleet. Mike Grondahl – Northland Capital Markets: Got you. And it’s fair that you feel better about growing the fleet today in October than you did at the beginning of the year. Correct?

Well we’re – definitely as I said little early. We’re definitely starting to see more opportunities to grow the fleet. So from a market perspective, commercial perspective yes.

I would also add to that Mike though that one of the reasons there is more secondary market activity is because the capital market environment is so broad (ph) and the potential for buyers to surface who have access to capital is better today than it was 18 months ago. So it definitely lead to more activity in the secondary market and for sellers it gives them more confident that if they do go out the portfolio that more than just GATX may show up. Mike Grondahl – Northland Capital Markets: Got you. And then Brian just looking at the specialty business a little bit, there was a comment in the press release just about pressure on the charter rates. How are you thinking about that business as we head into ‘011, I mean is it, do you think there will be remarketing in some of those portfolios or growth or is it just kind of getting as much rate as you can?

I think well as far as specialty portfolio, we really look at two ways. One is the marine joint venture – the joint ventures in general both marine and railroad. One the marine joint ventures that really depends on the type of asset we’re talking about for the dry bulkers for the gas and ethylene careers. They’ve had a pretty good 2010 in terms of rate, they’ve recovered nicely from a bottom at the end of 2008. But on the chemical joint ventures, chemical parcel tankers, they haven’t performed that well 2010. We really don’t see an ending sight to that one. It’s a very tough market and a lot of capacity is coming on. On the IAF side, I think you’ll see that portfolio grow. There is – we’re starting to see more opportunities there. Mike Grondahl – Northland Capital Markets: Okay, thank you.

Next we’ll go to Bob Napoli with Piper Jaffray. Bob Napoli – Piper Jaffray: Thank you. Good morning. With the I mean it seems I mean you guys seem more optimistic and I’ve heard you in a while not think by no means wildly optimistic, but given some improvement in the market your residue in comments still been really low and especially in the rail market and I mean, are you seeing more opportunities to kind of do a little more traditional buying and selling than you have. So should we should see that, do you think that you’re going to start seeing residue income move up as you possibly know adjusted portfolio a little – in a little more liquid basis than you have over the past couple of years?

On the rail side, we’re seeing more opportunities to buy and sell, yes that market is recovering. On the specialty side, it’s looking ahead in 2000 – let’s say last part of 2010 and into 2011. I don’t see a whole lot of schedule lease terminations. So I don’t know this will be significant remarking proceeds in specialty going forward. But in rail, folks not growing the fleet, those opportunities are increasing and yes, will you see remarketing gains in rail? Yes, because that the secondary market has improved, its back to. Bob Napoli – Piper Jaffray: Have rail car prices, what – have you seen an incremental improvement in rail car price, I guess it depends whether you’re buyer or a seller. But are rail car prices moving up off the bottom?

Are you talking about in the secondary market Bob for used equipment? Bob Napoli – Piper Jaffray: Both I guess.

Okay, well I can tell you in the secondary market, yes the buyer is pretty well because 2009 really nothing cleared the market. It just was very little activity. So any discussion around prices for specific rail cars were more hypothetical than anything else. But the market is more robust in secondary market today. So that would obviously lead to a little bit improvement in . . . generally, prices are down 20 to 25 percent from the peak on both tank and freight. They really haven’t moved up. There’s some noise in the industry that component suppliers are trying to push price increases through. Don’t really have actual data as far as that goes, so it’s been fairly steady in 2010. Bob Napoli – Piper Jaffray: OK. And on the ease rates, have the lease rates moved off the bottom or are they ...

Yes, lease rates have across the board almost moved off from the bottom in almost every category or car type except for anything construction related like a center beam where they’re still struggling mightily. But in general, absolute rates are improving across the board.

Where they sit today Bob, is still well before. Bob Napoli – Piper Jaffray: Yes, I understand.

I mean if you look at say a general service tank car where it was down 35 percent or more from peak to the bottom, and it’s recovered, but it’s only recovered about half way, so still well off the peak. Bob Napoli – Piper Jaffray: But that’s still a pretty significant recovery from the bottom.

It’s going in the right direction, but it’s going slowly. Bob Napoli – Piper Jaffray: Your balance sheet, I mean the rating agencies are always pretty tough on you guys as far as, and I mean your leverage, how much room do you have today to leverage off the balance sheet, to take advantage of the opportunities or do you need to raise some hybrid type capital. You know, maybe give a little feel for your ability to invest and whether or not you need any new capital of any type if you were to significantly increase the amounts you’re investing.

In the ordinary course of business, standard investment volume, even the increased activity we may see on the horizon here, I don’t see any need to raise additional capital. The type of transactions you might be talking about you know, a mega portfolio, something on the order of magnitude of our size, that could possible trade at some point in the future. Then we would have to look at the appropriate capital structure for the company if you were to pursue something like that. Bob Napoli – Piper Jaffray: But if you were to go up half a turn in leverage ...

Pardon me? Bob Napoli – Piper Jaffray: I mean if you went up half a turn in leverage, could you have the ability, you know, how much capital do you have? What ability do you have to increase leverage without any new capital today?

It’s always a bit of a dance as you know with the rating agencies, but half a turn is probably manageable. From there, it’s really all speculative and a little bit difficult to comment on Bob. Bob Napoli – Piper Jaffray: Thank you.

We’ll take our next question from Steve Barger with KeyBanc Capital Markets. Steve Barger – KeyBanc Capital Markets: Good morning guys. As I look at the industry numbers, they’re about 9,200 cars ordered in the quarter. I think I heard you say you ordered a few, but I don’t think the lessors have really come in yet. Last cycle, you guys were one of the first to place a big order. Is there any change in market dynamics where the railroads are buying more direct or is there, is it a car type issue? Any commentary on the market.

Yes, you’re right, lessors haven’t come in in any major way. I don’t think there’s really any trend out there or anything to suggest that it’s different from the past as far as who’s ordering cars or what types. Steve Barger – KeyBanc Capital Markets: I think in terms of the specialty segment, you said a little bit about IAF, but you know, I would expect the mining equipment, the oil and gas guys, construction, would really be strengthening right now if customers are still facing tight credit. Can you talk through some of the specific drivers in that specialty segment there?

Yes, we haven’t done a whole lot in those sectors that you mentioned. They’re very competitive sectors and especially, there’s a lot of banks that are coming in aggressively in that sector and some of that business doesn’t make sense. But we have seen opportunities for example inland marine, and those types of assets that make a lot more sense for GTX where the asset we know very well. It’s long lived. It’s widely used and we have some pretty decent relationships. Steve Barger – KeyBanc Capital Markets: OK. And last question, just trying to understand guidance a little bit better. If you look at normal seasonality, 4Q EPS is typically been down 25 or 30 percent from 3Q levels. Is there anything unusual that we should be thinking about with respect to 4Q that would cause your earnings to be stronger or weaker than that seasonal pattern would suggest?

Well typically what causes that pattern Steve, is marketing income. And just across the equipment industry, there is always less activity in the fourth quarter. Typically purchases and sales, more so for sales that are going to occur in a given year, most of those occur in the first three quarters, so you don’t see a lot of our marketing income typically in the fourth quarter. And that would be the swing factor GATX. Steve Barger – KeyBanc Capital Markets: And you expect that normal seasonal pattern will hold this quarter?

I don’t see anything on the horizon right now that would change that pattern and would expect marketing to be down in the fourth quarter from where we were in the third. Steve Barger – KeyBanc Capital Markets: Got it. I understand. Thanks.

And next from Jefferies, we’ll go to Daniel Fertata [ph]. Daniel Fertata [ph] – Jefferies: Good morning. Thank you for the time. First question is, did you disclose the investment rail this quarter, how it breaks down between U.S. and European assets?

We don’t have it broken out. It’ll be broken out in the Q. I can say the majority of the investment in the quarter was in North America. Daniel Fertata [ph] – Jefferies: OK. And then what percent of the fleet has been released or you expect will be released through 2010? Like if you looked at the beginning of the year to the end of the year.

It was about 17,000 cars that we has scheduled for renewal this year. Daniel Fertata [ph] – Jefferies: And do you mind telling me what your renewal expectation in terms of number of cars is for next year.

It will go up from that number Daniel, from the 17,000. You know, some of that depends on a little bit on what occurs here in the fourth quarter, but it will more likely be in the 19,000 plus range for 2011. Daniel Fertata [ph] – Jefferies: Got you. Well thank you very much. Take care.

Next we’ll hear from Brad Evans with Heartland. Brad Evans – Heartland: Yes, good morning. Just, most of my questions have been answered. I was just curious whether you would give us your thoughts in terms of the sequential rate of change in terms of lease rate into the early part of the fourth quarter. Have the improvement you saw in the third quarter, is that continued into the fourth quarter?

Generally yes. You’re absolutely right. Brad Evans – Heartland: OK. And just secondarily from an investment perspective, could you just qualitatively discuss the opportunities that you see to put capital to work today versus what you saw maybe say six months ago on the use side?

I can talk more about a year ago. It’s been pretty constant over the last six months. We see some opportunities on the raid side, and the industry has as well, the best example being the small covered hoppers for (inaudible) and then a car type that a lot of people have been ordering, both owned and leased. But we’ve also seen some opportunities in tank cars, general service. You know, it’s just getting a little bit better. Customers are starting to finally put on some new capacity, and they hadn’t been willing to do that nine months to a year ago. Brad Evans – Heartland: Some of the larger players who may have had some stress with the financial crisis who seem to have been a little less active in growing their fleets, and I think there’s been some speculation their commitment to the business longer term. Are we getting closer to a tipping point do you feel in terms of where rates are right now and asset value that you might start to see some movement of some larger portfolios of some folks who have been in the business but may not have an interest in the longer term to be in the business?

That’s a good question. We think that there’s a portfolio or two out there that is still likely to come loose, but it’s hard to talk about when. Brad Evans – Heartland: And I hate to ask a question that’s probably obvious, but in terms of availability on the credit side, the debt side, I realize the debt markets are wide open. I would imagine that is the case for you as well in terms of your ability to tap the debt markets. Is that a fair statement?

Yes. Absolutely. Capital markets are very strong right now and debt markets would be easily accessible and open for GTAX without a doubt at very attractive coupon. Brad Evans – Heartland: Great. Congratulations on the performance. Thank you.

Our next question comes from Sahid City [ph] with Scabelli[ph] & Co. Sahid City [ph] – Scabelli [ph] & Co.: Hi good morning. I have a couple of questions. The first is on share buyback. What’s your strategy? Did you buy any shares or what’s the plan going forward?

We have an authorization in place that has approximately $70 million remaining under it. There was no activity on that during the third quarter. Sahid City [ph] – Scabelli [ph] & Co.: You talked about the idle cars being an issue. What is the number of cars that are idled and what percentage of that is the total portfolio within the industry?

Within the industry, there’s about 331,000 idle cars.

You have to be careful about what your – GHX talked about idle cars in terms of the percentage of our fleet that is not leased. But industry talks about idle cars and the percentage of cars are the number of cars that haven’t moved for some period of time, usually 60 days. So it’s a little bit of a different statistic. Sahid City [ph] – Scabelli [ph] & Co.: And the 331,000 is the number that has not moved?

Exactly.

That number peaked at over 500,000 early 2009 and has steadily marched down to 331,000 today. Sahid City [ph] – Scabelli [ph] & Co.: And that’s roughly one-third of the total cars? Is that a fair assessment?

Like 22 percent. Sahid City [ph] – Scabelli [ph] & Co.: 22 percent. OK. And my next question is on a deal we recently had, ACLI, you probably saw that, American Commercial Length. Would you have any comments on that or how do you see that changing the industry, especially within your specialty segment?

We don’t anticipate any significant change from that announced transaction. Sahid City [ph] – Scabelli [ph] & Co.: OK. And you said there may be a portfolio coming loose at some point. Do you know the size of that?

I don’t think we can speculate on that.

Don’t want to talk about names or specifics. It just seems we spent a tremendous amount of time talking to other lessors about their fleets and the likely outcome and it’s just our feel from talking to the entire industry that there’s still one or two that will come loose, of a decent size. But going into detail beyond that does not serve us well. Sahid City [ph] – Scabelli [ph] & Co.: Thank you so much.

We’ll go next to Mario Gabelli with Gabelli & Co. Mario Gabelli – Gabelli & Co.: I didn’t mean to double team you. Sahid asked a couple questions. I’ll just hitchhike on one of them. Did you not buy stock because of economic or legal reasons?

Mario, it’s Bob. We have not been active under the repurchase authorization this year. There are legal restrictions or anything else. Mario Gabelli – Gabelli & Co.: I just always love to ask. There was a company that did something interesting recently. The size of a buy back, assuming you bought $1 billion of fleet, just picking any number, size of your company, what would be your expected unleveraged cash on cash return on that?

Well you know it depends on the fleet, Mario. If it’s a distress fleet, you’d look at probably a double digit return. If it’s buying cars, you know, if it’s a huge order, you’re going to get a lot less because that will be one of those things that you’ll hold it till the end. Mario Gabelli – Gabelli & Co.: As you know, I’ve always been pitching for you to use OPM’s, other people’s money, and an MLP where you’re the GP on an MLP of even half of that kind of return, would attract a lot of interest particularly if there’s some long term benefits on it. So if you’re looking at sources of capital, obviously I’m not going to pitch somebody else’s investment banking services, but a lot of money out there.

Understood. I think ... Mario Gabelli – Gabelli & Co.: And you guys have the management expertise. There’s no point in having some, be out for some private equity firm or some hedge fund do it.

Right, but we’re going to pay the right price. Mario Gabelli – Gabelli & Co.: Always, even if it’s OPM’s. Got it. Thanks very much.

Thank you.

At this time there are no further questions in the queue. It appears we have no further questions.

Thank you Erin, and thanks everyone for participating. We’ll be available this afternoon to answer any additional questions.

Once again ladies and gentlemen. That concludes our conference. Thank you all for your participation.