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Proc-Type: 2001,MIC-CLEAR
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<SEC-DOCUMENT>0000950137-02-000376.txt : 20020414
<SEC-HEADER>0000950137-02-000376.hdr.sgml : 20020414
ACCESSION NUMBER:		0000950137-02-000376
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20020128
ITEM INFORMATION:		Other events
FILED AS OF DATE:		20020128

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			GATX CORP
		CENTRAL INDEX KEY:			0000040211
		STANDARD INDUSTRIAL CLASSIFICATION:	TRANSPORTATION SERVICES [4700]
		IRS NUMBER:				361124040
		STATE OF INCORPORATION:			NY
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-02328
		FILM NUMBER:		02519417

	BUSINESS ADDRESS:	
		STREET 1:		500 W MONROE  ST
		CITY:			CHICAGO
		STATE:			IL
		ZIP:			60661
		BUSINESS PHONE:		3126216200

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	GENERAL AMERICAN TRANSPORTATION CORP
		DATE OF NAME CHANGE:	19750722
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>c67195e8-k.txt
<DESCRIPTION>CURRENT REPORT
<TEXT>
<PAGE>
================================================================================


                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    Form 8-K
                                 Current Report

                             -----------------------

                       PURSUANT TO SECTION 13 OR 15 (d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

        Date of Report (Date of Earliest Event Reported) January 28, 2002

                             -----------------------

                                GATX Corporation
             (Exact Name of Registrant as Specified in its Charter)



            New York                    1-2328                  36-1124040
(State or other jurisdiction   (Commission file number)      (I.R.S. employer
      of incorporation)                                   identification number)



                             500 West Monroe Street,
                          Chicago, Illinois 60661-3676
                    (Address of principal executive offices)

        Registrant's telephone number, including area code (312) 621-6200


<PAGE>



ITEM 5.  OTHER EVENTS

         On January 25, 2002, GATX Corporation issued a press release announcing
that it plans to offer $150 million of convertible senior unsecured notes. The
notes are expected to have a 5-year maturity, and may be converted into shares
of common stock of GATX Corporation.

         The net proceeds of the offering will be used by GATX Financial
Corporation, a wholly-owned subsidiary of GATX Corporation, for repayment of
indebtedness and general corporate purposes.

         The notes will not be registered under the Securities Act of 1933 and
may not be offered or sold in the United States absent registration or an
applicable exemption from the registration requirements of the Securities Act of
1933. It is anticipated that a registration statement will be filed under the
Securities Act of 1933 to permit the resale of the notes and the underlying
shares of common stock issuable upon conversion.

         The following recent development information is being included in the
offering memorandum:

         CONSOLIDATED. GATX recently reported a fourth quarter 2001 net loss of
$12.1 million or $.25 per diluted share. The prior year fourth quarter loss was
$60.6 million or $1.27 per diluted share.

         For the 2001 full year, GATX reported net income of $172.9 million or
$3.51 per diluted share. Excluding non-comparable items, GATX reported 2001 full
year income of $109.7 million, or $2.23 per diluted share. The 2000 full year
income was $164.2 million or $3.37 per diluted share, excluding the Airlog
litigation provision.

         Among the non-comparable items in 2001, the most significant items
include the gain on the sale of GATX Terminals, charges related to our
telecommunications portfolio, costs associated with the closure of a railcar
repair facility, and in the fourth quarter, charges related to a workforce
reduction and asset impairment losses in the air group stemming from the events
of September 11.

         The remaining discussion in this "Recent Developments" section
regarding consolidated and business unit results for the 2001 fourth quarter and
2001 full year exclude these non-comparable items, unless noted otherwise. Your
attention is directed to the press release attached to our Current Report on
Form 8-K filed on January 23, 2002, for our 2001 financial results reflecting
these non-comparable items.

         GATX RAIL. GATX Rail reported income of $17.7 million in the fourth
quarter compared to $13.4 million in the prior year period. The improvement in
GATX Rail's fourth quarter income was due in part to lower SG&A and maintenance
expenditures, coupled with a short-term spike in demand for railcars at DEC,
GATX Rail's operation in Poland. Due to continued soft demand for railcars and
lease rate pressure, the 2001 fourth quarter income does not reflect our
expected quarterly run rate in this environment. For the 2001 full year, GATX
Rail reported net income of $52.4 million compared to $65.7 million in the prior
year period.

         Utilization of GATX Rail's North American full service fleet remained
at 91% at the end of the fourth quarter, consistent with the 2001 third quarter
level, but down from 93% in the prior year period. GATX Rail's full service
North American fleet totaled 91,100 cars at year end, down slightly from the
prior quarter and year ago levels. Fourth quarter deliveries totaled only 310
cars, an indication of continued softness in the rail market.

         North American manufacturing capacity utilization, one of several
benchmarks for economic activity and ultimately demand for railcars, was 72% at
year end. This low level of capacity has not been experienced since the
mid-1980's. This is consistent with the 2001 third quarter level and indicates
that underlying factors that drive railcar demand have not yet rebounded.

         FINANCIAL SERVICES. Financial Services, comprised principally of GATX
Capital, reported a fourth quarter loss of $6.2 million compared to income of
$13.8 million in the prior year period, excluding the Airlog litigation
provision. Fourth quarter performance was affected by a large loss provision
taken during the quarter, consistent with prior statements regarding GATX
Capital's focus on maintaining an appropriate reserve level in this weakened
economic environment. For the 2001 full year, Financial Services reported income
of $63.5 million compared to $83.9 million in the prior year, excluding the
Airlog litigation provision.

         Investment volume totaled $287 million during the fourth quarter
compared to $508 million in the prior year period. For the 2001 full year,
investment volume totaled $1.8 billion compared to $1.5 billion in the prior
year. The 2001 volume reflects continued investment primarily in our air and
technology markets.


<PAGE>

         For the fourth quarter, pre-tax spread totaled $46.3 million compared
to $33.6 million in the prior year period. Annualized pre-tax spread in the
fourth quarter was 4.6% of average net investments, compared to 3.9% for the
prior year period. For the 2001 full year, pre-tax spread totaled $190.9 million
compared to $149.2 million in the prior year. Pre-tax spread in 2001 was 4.8% of
average net investments, compared to 4.7% for the prior year. Increased lease
and interest income was the key driver behind the increase in pre-tax spread.

         Remarketing income, comprised of both gains on asset sales and residual
sharing fees, was $13.9 million in the fourth quarter compared to $17.7 million
in the prior year period. Remarketing income totaled $99.0 million in 2001
compared to $57.2 million in the prior year. The increased remarketing income
was driven by stronger gains within the diversified and technology portfolios.
Warrant income totaled $3.6 million in the fourth quarter compared to $17.9
million in the prior year period. For the 2001 full year, warrant income totaled
$38.7 million compared to $52.3 million in the prior year. Asset remarketing
income and gains from the sale of stock do not occur evenly from period to
period.

         Loss provisions, including telecommunications and air-related
provisions, totaled $36.4 million in the fourth quarter, compared to $7.5
million in the prior year period. For the 2001 full year, loss provisions
totaled $98.1 million, including telecommunications and air-related provision of
$7.8 million, compared to $16.1 million in the prior year. The increase in loss
provision reflects the weaker economic conditions experienced during 2001, and
our initiative to maintain an appropriate allowance position. The allowance for
loss was 6.0% of reservable assets at year end compared to 6.4% in both the
prior quarter and prior year.

         Net charge-offs of reservable assets during the fourth quarter totaled
$52.5 million. For the full 2001 year, net charge-offs totaled $101.4 million,
or 2.6% of average net investments, compared to $36.8 million, or 1.1% of
average net investments, in the prior year period. The increased charge-off
levels in 2001 primarily reflected the impact of a weaker economic environment
on our portfolio.

         Asset impairments totaled $15.3 million in the 2001 fourth quarter,
including $8.3 million related to telecommunication and air assets, compared to
$5.0 million in the prior year period. For the 2001 full year, impairments
totaled $85.2 million, including $75.6 million related to telecommunication and
air assets, compared to $5.0 million in the prior year.

REVIEW BY MOODY'S INVESTORS SERVICE

         On January 15, 2002, Moody's Investors Service placed the long-term and
short-term ratings of GATX Financial and its affiliate on review for possible
downgrade. In its release, Moody's stated that, although near-term financial
flexibility is solid, its action reflected Moody's concerns about the long-term
financial flexibility of GATX Financial, as well as the potential for rising
secured debt within GATX's capital structure.

CERTAIN RECENT EVENTS

         On January 15, 2002, a GATX Financial railcar located at a CSX siding
in West Virginia developed a circumferential crack allowing its contents -
toluene - to escape. The immediate area surrounding the incident was temporarily
evacuated. No deaths or injuries were reported. The cause of the chemical escape
is not known nor is there sufficient information at this time to ascertain the
extent of the liability of GATX Financial, if any, with respect to this matter.

         On January 18, 2002, a Canadian Pacific train containing a number of
GATX Financial railcars containing anhydrous ammonia derailed near Minot, North
Dakota. News media covering the event have reported that, as a result of the
derailment, as many as five of the cars containing anhydrous ammonia leaked. One
person died and in excess of 100 people were treated at the local hospital as a
result of inhalation of the anhydrous ammonia. Fifteen people were admitted to
the hospital, including five who were admitted to intensive care with
respiratory problems and skin burns from the ammonia. The cause of the
derailment is not known nor is there sufficient information at this time to
ascertain the extent of the liability of GATX Financial, if any, with respect to
this matter.

         In March 2001, East European Kolia-System Financial Consultant S.A.
filed a complaint in the Regional Court (Commercial Division) in Warsaw, Poland
against Dyrekcha Eksploatacji Cystern Sp. z.o.o. ("DEC"), an indirect
wholly-owned subsidiary of GATX Financial, alleging damages of approximately $52
million arising out of the unlawful taking over by DEC in August of 1998, of a
51% interest in Kolsped Spedytor Miedzynarodwy Sp. z.o.o. ("Kolsped"), and
removal of valuable property from Kolsped. The complaint was not served on DEC
until December of 2001. The plaintiff claims that DEC unlawfully obtained
confirmation of satisfaction of a condition precedent to its purchase of a 51%
interest in Kolsped, following which it allegedly mismanaged Kolsped and put it
into bankruptcy. The plaintiff claims to have purchased the same 51% interest in
Kolsped in April of 1999,


<PAGE>

subsequent to DEC's alleged failure to satisfy the condition precedent. We
purchased DEC in March 2001. We believe this claim is without merit, and are
vigorously pursuing the defense thereof.

         While the ultimate liability with respect to the above matters cannot
be determined at this time, it is our opinion that the amounts, if any, required
to be paid by GATX Financial or its subsidiaries with respect to these matters
are not likely to be material to our consolidated financial position or results
of operations.







<PAGE>
                                    SIGNATURE


Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.



                                                     GATX CORPORATION
                                            -----------------------------------
                                                       (Registrant)

                                                   /s/ Brian A. Kenney
                                            -----------------------------------
                                                     Brian A. Kenney
                                                    Vice President and
                                                 Chief Financial Officer
                                                (Duly Authorized Officer)



Date:  January 28, 2002



</TEXT>
</DOCUMENT>
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