10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

__________________________________________ 

FORM 10-Q

__________________________________________  

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

For the quarterly period ended March 31, 2014

or

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

Commission File Number: 1-2328

GATX Corporation

(Exact name of registrant as specified in its charter)

New York	36-1124040
(State of incorporation)	(I.R.S. Employer Identification No.)
222 West Adams Street
Chicago, Illinois 60606-5314
(Address of principal executive offices, including zip code)
(312) 621-6200
(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act).

x	Large accelerated filer	¨	Accelerated filer
¨	Non-accelerated filer	¨	Smaller reporting company

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   

Yes  ¨    No  x

As of March 31, 2014, 46.0 million common shares were outstanding.

GATX CORPORATION

FORM 10-Q

QUARTERLY REPORT FOR THE PERIOD ENDED MARCH 31, 2014

INDEX

Item No.		Page No.
Part I – FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Balance Sheets (Unaudited)	1
	Consolidated Statements of Comprehensive Income (Unaudited)	2
	Consolidated Statements of Cash Flows (Unaudited)	3
	Notes to the Consolidated Financial Statements (Unaudited)	4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations
	Forward-Looking Statements	15
	Business Overview	15
	Discussion of Operating Results	16
	Segment Operations	16
	Cash Flow and Liquidity	26
	Critical Accounting Policies	29
	Non-GAAP Financial Measures	29
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	32
Item 4.	Controls and Procedures	32
Part II – OTHER INFORMATION
Item 1.	Legal Proceedings	33
Item 1A.	Risk Factors	33
Item 6.	Exhibits	33
SIGNATURE		34
EXHIBIT INDEX		35

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

GATX CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(In millions, except share data)

	March 31			December 31
	2014			2013
Assets
Cash and Cash Equivalents	$	447.0		$	379.7
Restricted Cash	14.8			20.3
Receivables
Rent and other receivables	54.2			80.1
Loans	121.4			122.7
Finance leases	200.5			207.3
Less: allowance for losses	(5.2		)	(5.2		)
	370.9			404.9
Operating Assets and Facilities ($123.2 and $123.3 related to a consolidated VIE)	7,958.7			7,390.7
Less: allowance for depreciation ($31.4 and $30.3 related to a consolidated VIE)	(2,358.9		)	(2,320.4		)
	5,599.8			5,070.3
Investments in Affiliated Companies	348.5			354.3
Goodwill	94.7			94.6
Other Assets	243.3			225.5
Total Assets	$	7,119.0		$	6,549.6
Liabilities and Shareholders’ Equity
Accounts Payable and Accrued Expenses	$	171.5		$	159.6
Debt
Commercial paper and borrowings under bank credit facilities	38.2			23.6
Recourse	4,310.0			3,765.9
Nonrecourse ($23.0 and $25.4 related to a consolidated VIE)	70.1			72.6
Capital lease obligations	7.6			8.9
	4,425.9			3,871.0
Deferred Income Taxes	909.4			891.4
Other Liabilities	189.0			230.6
Total Liabilities	5,695.8			5,152.6
Shareholders’ Equity
Common stock, $0.625 par value: Authorized shares — 120,000,000 Issued shares — 66,529,703 and 66,349,906 Outstanding shares — 46,048,495 and 45,868,698	41.4			41.3
Additional paid in capital	666.2			668.9
Retained earnings	1,384.6			1,358.4
Accumulated other comprehensive loss	(40.1		)	(42.7		)
Treasury stock at cost (20,481,208 shares)	(628.9		)	(628.9		)
Total Shareholders’ Equity	1,423.2			1,397.0
Total Liabilities and Shareholders’ Equity	$	7,119.0		$	6,549.6

See accompanying notes to consolidated financial statements.

1

GATX CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(In millions, except per share data)

	Three Months Ended March 31
	2014			2013
Revenues
Lease revenue	$	250.6		$	237.2
Marine operating revenue	17.7			18.5
Other revenue	18.3			16.6
Total Revenues	286.6			272.3
Expenses
Maintenance expense	73.1			66.7
Marine operating expense	15.0			16.6
Depreciation expense	58.7			57.9
Operating lease expense	26.9			32.3
Other operating expense	6.6			5.3
Selling, general and administrative expense	42.7			42.0
Total Expenses	223.0			220.8
Other Income (Expense)
Net gain on asset dispositions	28.1			16.7
Interest expense, net	(42.0		)	(40.9		)
Other expense	(3.4		)	(1.1		)
Income before Income Taxes and Share of Affiliates’ Earnings	46.3			26.2
Income Taxes	(14.1		)	(7.5		)
Share of Affiliates’ Earnings, Net of Taxes	9.9			8.4
Net Income	$	42.1		$	27.1
Other Comprehensive Income, Net of Taxes
Foreign currency translation adjustments	0.7			(17.0		)
Unrealized loss (gain) on securities	(0.2		)	0.1
Unrealized gain on derivative instruments	0.7			1.5
Post-retirement benefit plans	1.4			2.0
Other comprehensive income (loss)	2.6			(13.4		)
Comprehensive Income	$	44.7		$	13.7
Share Data
Basic earnings per share	$	0.92		$	0.58
Average number of common shares	46.0			46.9
Diluted earnings per share	$	0.90		$	0.57
Average number of common shares and common share equivalents	46.8			47.7
Dividends declared per common share	$	0.33		$	0.31

See accompanying notes to consolidated financial statements.

2

GATX CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(In millions)

	Three Months Ended March 31
	2014			2013
Operating Activities
Net income	$	42.1		$	27.1
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation expense	62.1			60.9
Change in accrued operating lease expense	(39.8		)	(46.0		)
Gains on sales of assets	(26.9		)	(13.8		)
Deferred income taxes	11.0			4.3
Share of affiliates’ earnings, net of dividends	1.9			(7.9		)
Other	1.0			(0.4		)
Net cash provided by operating activities	51.4			24.2
Investing Activities
Additions to operating assets and facilities	(445.5		)	(141.4		)
Loans extended	—			(8.5		)
Portfolio investments and capital additions	(445.5		)	(149.9		)
Purchases of leased-in assets	(150.5		)	(11.3		)
Portfolio proceeds	66.6			64.5
Proceeds from sales of other assets	7.0			8.7
Net decrease in restricted cash	5.5			2.8
Other	—			(0.1		)
Net cash used in investing activities	(516.9		)	(85.3		)
Financing Activities
Net proceeds from issuances of debt (original maturities longer than 90 days)	842.5			597.9
Repayments of debt (original maturities longer than 90 days)	(307.1		)	(264.9		)
Net increase (decrease) in debt with original maturities of 90 days or less	14.5			(149.7		)
Stock repurchases	—			(18.3		)
Dividends	(16.9		)	(16.3		)
Other	(1.2		)	(0.3		)
Net cash provided by financing activities	531.8			148.4
Effect of Exchange Rate Changes on Cash and Cash Equivalents	1.0			(0.4		)
Net increase in Cash and Cash Equivalents	67.3			86.9
Cash and Cash Equivalents, beginning of period	379.7			234.2
Cash and Cash Equivalents, end of period	$	447.0		$	321.1
Noncash Investing Transactions
Distributions from affiliates (1)	$	1.1		$	1.8

_________

(1) We received distributions of 62 railcars in 2014 and 182 railcars in 2013 from our Southern Capital affiliate.

See accompanying notes to consolidated financial statements.

3

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1. Description of Business

As used herein, "GATX," "we," "us," "our," and similar terms refer to GATX Corporation and its subsidiaries, unless indicated otherwise.

We lease, operate, manage, and remarket long-lived, widely-used assets, primarily in the rail and marine markets. We also invest in joint ventures that complement our existing business activities. We report our financial results through fourprimary business segments: Rail North America, Rail International, American Steamship Company (“ASC”), and Portfolio Management.

NOTE 2. Basis of Presentation

We prepared the accompanying unaudited consolidated financial statements in accordance with US Generally Accepted Accounting Principles ("GAAP") for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, our unaudited consolidated financial statements do not include all of the information and footnotes required for complete financial statements. We have included all of the normal recurring adjustments that we deemed necessary for a fair presentation.

Operating results for the three months ended March 31, 2014, are not necessarily indicative of the results we may achieve for the entire year ending December 31, 2014. In particular, ASC's fleet is inactive for a significant portion of the first quarter of each year due to winter conditions on the Great Lakes. In addition, asset remarketing income does not occur evenly throughout the year. For more information, refer to the consolidated financial statements and footnotes in our Annual Report on Form 10-K for the year ended December 31, 2013.

Change in Accounting Estimate

During the first quarter of 2014, we completed a review of the estimated useful lives used for our North American railcar fleet and determined that the economic service life of many of our railcars differed from the useful life currently used to calculate depreciation. As a result, effective January 1, 2014, we revised the estimated useful lives from a range of 30-38 years to a range of 27-42 years. In aggregate, the average depreciable life of the fleet increased approximately 2.2 years. The impact of these implemented changes on depreciation expense for affected assets in the first quarter of 2014 is a net decrease in depreciation expense of approximately $5.5 million and an increase in net income of $3.5 million, or $0.08 per diluted share. The full year impact for 2014 for affected assets is expected to be a decrease in depreciation expense of approximately $21.9 million and an increase in net income of $14.0 million, or approximately $0.30 per diluted share.

NOTE 3. Variable Interest Entities

We are the primary beneficiary of one of our variable interest entities, a structured lease financing of a portfolio of railcars, because we have the power to direct its significant activities. As a result, we consolidate this variable interest entity. The risks associated with it are similar to those of our wholly owned railcar leasing activities.

The following table shows the carrying amounts of assets and liabilities of the consolidated variable interest entity (in millions):

	March 31 2014		December 31 2013
Operating assets, net of accumulated depreciation (1)	$	91.8	$	93.0
Nonrecourse debt	23.0		25.4

_________

(1) All operating assets are pledged as collateral on the nonrecourse debt.

We determined that we are not the primary beneficiary of our other variable interest entities, which are primarily investments in railcar and equipment leasing affiliates that were financed through a variety of equity investments and third party lending arrangements. We are not the primary beneficiary of these variable interest entities because we do not have the power to direct the activities that most significantly impact the entities’ economic performance. For investments in affiliates we determined were variable interest entities, we concluded that power was shared by the affiliate partners based on the terms of the relevant joint venture agreements, which require approval of all partners for significant decisions regarding the variable interest entity.

4

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

The following table shows the carrying amounts and maximum exposure to loss for our unconsolidated variable interest entities (in millions):

	March 31, 2014				December 31, 2013
	Net Carrying Amount		Maximum Exposure to Loss		Net Carrying Amount		Maximum Exposure to Loss
Investments in affiliates	$	129.4	$	129.4	$	125.5	$	125.5
Other investment	0.6		0.6		0.6		0.6
Total	$	130.0	$	130.0	$	126.1	$	126.1

NOTE 4. Fair Value Disclosure

The following tables show our assets and liabilities that are measured at fair value on a recurring basis (in millions):

Assets	March 31, 2014		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs    (Level 3)
Interest rate derivatives (1)	$	4.8	$	—	$	4.8	$	—
Available-for-sale equity securities	4.2		4.2		—		—
Liabilities
Interest rate derivatives (1)	3.1		—		3.1		—
Interest rate derivatives (2)	0.2		—		0.2		—
Foreign exchange rate derivatives (2)	2.6		—		2.6		—

Assets	December 31, 2013		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Interest rate derivatives (1)	$	6.0	$	—	$	6.0	$	—
Available-for-sale equity securities	4.7		4.7		—		—
Liabilities
Interest rate derivatives (1)	0.8		—		0.8		—
Interest rate derivatives (2)	0.2		—		0.2		—
Foreign exchange rate derivatives (2)	2.6		—		2.6		—

_________

(1) Designated as hedges.

(2) Not designated as hedges.

We base our valuations of available-for-sale equity securities on their quoted prices on an active exchange. We value derivatives using a pricing model with inputs (such as yield curves and credit spreads) that are observable in the market or that can be derived principally from observable market data.

5

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

Derivative instruments

Fair Value Hedges

We use interest rate swaps to manage the fixed-to-floating rate mix of our debt obligations by converting the fixed rate debt to floating rate debt. For fair value hedges, we recognize changes in fair value of both the derivative and the hedged item as interest expense. We had six instruments outstanding with an aggregate notional amount of $500.0 million as of March 31, 2014, and three instruments outstanding with an aggregate notional amount of $200.0 million as of December 31, 2013. These derivatives have maturities ranging from 2015 to 2019.

Cash Flow Hedges

We use interest rate swaps to convert floating rate debt to fixed rate debt. We also use Treasury rate locks to hedge our exposure to interest rate risk on anticipated transactions. We had six instruments outstanding with an aggregate notional amount of $163.5 million as of March 31, 2014, and six instruments outstanding with an aggregate notional amount of $163.6 million as of December 31, 2013. These derivatives had maturities ranging from 2014 to 2020. Within the next 12 months, we expect to reclassify $9.5 million ($6.0 million after-tax) of net losses on previously terminated derivatives from accumulated other comprehensive loss. We reclassify these amounts when interest and operating lease expense on the related hedged transactions affect earnings.

Non-designated Derivatives

We do not hold derivative financial instruments for purposes other than hedging, although certain of our derivatives are not designated as accounting hedges. We recognize changes in the fair value of these derivatives in other (income) expense immediately.

Some of our derivative instruments contain credit risk provisions that could require us to make immediate payment on net liability positions in the event that we default on certain outstanding debt obligations. The aggregate fair value of our derivative instruments with credit risk related contingent features that are in a liability position as of March 31, 2014, was $4.2 million. We are not required to post any collateral on our derivative instruments and do not expect the credit risk provisions to be triggered.

In the event that a counterparty fails to meet the terms of an interest rate swap agreement or a foreign exchange contract, our exposure is limited to the fair value of the swap, if in our favor. We manage the credit risk of counterparties by transacting with institutions that we consider financially sound and by avoiding concentrations of risk with a single counterparty. We believe that the risk of non-performance by any of our counterparties is remote.

The following table shows the impacts of our derivative instruments on our statement of comprehensive loss (in millions):

		Three Months Ended March 31
Derivative Designation	Location of Loss (Gain) Recognized	2014		2013
Fair value hedges (1)	Interest expense	$	2.1	$	1.1
Cash flow hedges	Other comprehensive loss (gain) (effective portion)	1.8		(0.3		)
Cash flow hedges	Interest expense (effective portion reclassified from accumulated other comprehensive loss)	1.2		1.2
Cash flow hedges	Operating lease expense (effective portion reclassified from accumulated other comprehensive loss)	2.4		0.4
Non-designated	Other expense	0.1		0.5

_________

(1) The fair value adjustments related to the underlying debt equally offset the amounts recognized in interest expense.

6

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

Other Financial Instruments

The carrying amounts of cash and cash equivalents, restricted cash, rent and other receivables, accounts payable, and commercial paper and bank credit facilities approximate fair value due to the short maturity of those instruments. We base the fair values of investment funds, which are accounted for under the cost method, on the best information available, which may include quoted investment fund values. We estimate the fair values of loans and fixed and floating rate debt using discounted cash flow analyses based on interest rates currently offered for loans with similar terms to borrowers of similar credit quality. The inputs we use to estimate each of these values are classified in Level 2 of the fair value hierarchy because they are directly or indirectly observable inputs.

The following table shows the carrying amounts and fair values of our other financial instruments as of (in millions):

	March 31, 2014				December 31, 2013
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Assets
Investment funds	$	1.7	$	3.8	$	1.7	$	4.0
Loans	121.4		120.2		122.7		121.5
Liabilities
Recourse fixed rate debt	$	3,718.8	$	3,851.6	$	2,871.2	$	2,994.0
Recourse floating rate debt	591.2		595.4		894.7		906.2
Nonrecourse debt	70.1		71.6		72.6		74.7

NOTE 5. Pension and Other Post-Retirement Benefits

The following table shows components of our pension and other post-retirement benefits expense for the three months ended March 31, 2014 and 2013 (in millions):

	2014 Pension Benefits			2013 Pension Benefits			2014 Retiree Health and Life		2013 Retiree Health and Life
Service cost	$	1.4		$	1.8		$	—	$	0.1
Interest cost	5.1			4.6			0.4		0.4
Expected return on plan assets	(7.2		)	(6.9		)	—		—
Amortization of (1):
Unrecognized prior service credit	(0.2		)	(0.3		)	—		—
Unrecognized net actuarial loss	2.6			3.5			—		0.1
Net expense	$	1.7		$	2.7		$	0.4	$	0.6

_________

(1) Amounts reclassified from accumulated other comprehensive loss.

NOTE 6. Share-Based Compensation

During the first three months of 2014, we granted 290,500 stock appreciation rights (“SARs”), 53,680 restricted stock units, 62,670 performance shares, and 4,363 phantom stock units. For the three months endedMarch 31, 2014, total share-based compensation expense was $3.1 million and the related tax benefit was $1.2 million. For the three months endedMarch 31, 2013, total share-based compensation expense was $3.2 million and the related tax benefit was $1.2 million.

7

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

The estimated fair value of our 2014 SARs awards and related underlying assumptions are shown in the table below.

	2014
Estimated fair value	$	18.90
Quarterly dividend rate	$	0.33
Expected term of stock appreciation rights, in years	4.4
Risk-free interest rate	1.3		%
Dividend yield	2.3		%
Expected stock price volatility	30.3		%
Present value of dividends	$	5.76

NOTE 7. Income Taxes

Our effective tax rate was 30% for the three months ended March 31, 2014, compared to 29% for the three months ended March 31, 2013. The difference in the effective rates for each period, compared to the statutory rate of 35%, is primarily attributable to the mix of pretax income in each year among domestic and foreign jurisdictions which are taxed at different rates.

As of March 31, 2014, our gross liability for unrecognized tax benefits was $5.3 million. If fully recognized, these tax benefits would decrease our income tax expense by $5.3 million ($3.4 million, net of federal tax). During the three months ended March 31, 2014, upon the close of a foreign tax audit, we released a gross unrecognized tax benefit of $0.4 million. We do not anticipate the recognition of any tax benefits that were previously unrecognized within the next 12 months.

8

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

NOTE 8. Commercial Commitments

We have entered into various commercial commitments, such as guarantees and standby letters of credit, related to certain transactions. These commercial commitments require us to fulfill specific obligations in the event of third party demands. Similar to our balance sheet investments, these commitments expose us to credit, market, and equipment risk. Accordingly, we evaluate these commitments and other contingent obligations using techniques similar to those we use to evaluate funded transactions.

The following table shows our commercial commitments (in millions):

	March 31 2014		December 31 2013
Lease payment guarantees	$	33.1	$	34.8
Standby letters of credit	8.7		8.8
Asset residual value guarantees	—		5.6
Performance bonds	0.4		0.6
Total commercial commitments (1)	$	42.2	$	49.8

_________

(1) The carrying value of liabilities on the balance sheet for commercial commitments was $6.0 million at March 31, 2014 and $6.2 million at December 31, 2013. The expirations of these commitments range from 2014 to 2023. We are not aware of any event that would require us to satisfy any of our commitments.

Lease payment guarantees are commitments to financial institutions to make lease payments for a third party in the event they default. We reduce any liability that may result from these guarantees by the value of the underlying asset or group of assets.

We are also parties to standby letters of credit and performance bonds, which primarily relate to contractual obligations and general liability insurance coverages. No material claims have been made against these obligations, and no material losses are anticipated.

Asset residual value guarantees are commitments to third parties that an asset or group of assets will be worth a specified value at the end of a lease term. We earn a fee for providing these guarantees, which we amortize into income over the guarantee period. If the assets are disposed of for more than the amount we guaranteed, we receive a share of the proceeds in excess of the guaranteed amount. We record these residual sharing gains in our net gain on asset dispositions. If the net realizable value of the asset is less than the guaranteed amount, we incur a liability for the amount we guaranteed less the value realized from the asset's disposal.

NOTE 9. Earnings per Share

We compute basic earnings per share by dividing net income available to our common shareholders by the weighted average number of shares of our common stock outstanding. We appropriately weighted shares issued or reacquired during the period that they were outstanding. Our diluted earnings per share reflect the impacts of our potentially dilutive securities, which include our convertible preferred stock and our equity compensation awards.

In the second quarter of 2013, both series of our preferred stock were retired with all shares either converted to common stock or redeemed.

9

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

The following table shows the computation of our basic and diluted net income per common share (in millions, except per share amounts):

	Three Months Ended March 31
	2014		2013
Numerator:
Net income	$	42.1	$	27.1
Denominator:
Weighted average shares outstanding - basic	46.0		46.9
Effect of dilutive securities:
Equity compensation plans	0.8		0.7
Convertible preferred stock	—		0.1
Weighted average shares outstanding - diluted	46.8		47.7
Basic earnings per share	$	0.92	$	0.58
Diluted earnings per share	$	0.90	$	0.57

NOTE 10. Accumulated Other Comprehensive Loss

The following table shows the change in components for accumulated other comprehensive loss (in millions):

	Foreign Currency Translation Gain (Loss)		Unrealized Gain (Loss) on Securities			Unrealized Loss on Derivative Instruments			Post-Retirement Benefit Plans			Total
Balance at December 31, 2013	$	57.2	$	0.4		$	(22.1	)	$	(78.2	)	$	(42.7	)
Change in component	0.7		(0.5		)	(2.2		)	—			(2.0		)
Reclassification adjustments into earnings	—		—			3.6			2.4			6.0
Income tax effect	—		0.3			(0.7		)	(1.0		)	(1.4		)
Balance at March 31, 2014	$	57.9	$	0.2		$	(21.4	)	$	(76.8	)	$	(40.1	)

________

See "Note 4. Fair Value Disclosure" and "Note 5. Pension and Other Post-Retirement Benefits" for impacts of the reclassification adjustments on the statement of comprehensive income.

NOTE 11. Legal Proceedings and Other Contingencies

Various legal actions, claims, assessments and other contingencies arising in the ordinary course of business are pending against GATX and certain of our subsidiaries. These matters are subject to many uncertainties, and it is possible that some of these matters could ultimately be decided, resolved or settled adversely. For a full discussion of our pending legal matters, please refer to "Note 23. Legal Proceedings and Other Contingencies" of our consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2013.

Viareggio Derailment

In June 2009, a train consisting of fourteen liquefied petroleum gas (“LPG”) tank cars owned by GATX Rail Austria GmbH (an indirect subsidiary of the Company, "GATX Rail Austria") and its subsidiaries derailed while passing through the City of Viareggio, in the province of Lucca, Italy. Five tank cars overturned and one of the overturned cars was punctured by a peg or obstacle along the side of the track, resulting in a release of LPG, which subsequently ignited. Thirty-two people died and others were injured in the fire, which also resulted in property damage. The LPG tank cars were leased to FS Logistica S.p.A., a subsidiary of the Italian state-owned railway, Ferrovie dello Stato S.p.A (the “Italian Railway”).

10

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

On December 14, 2012, the Public Prosecutors of Lucca ("Public Prosecutors") formally charged GATX Rail Austria and two of its subsidiaries (collectively, "GRA"), as well as ten maintenance and supervisory employees (the "Employees"), with various negligence-based crimes related to the accident, all of which are punishable under Italian law by incarceration, damages and fines. Similar charges were brought against four Italian Railway companies and eighteen of their employees, among others. The Public Prosecutors assert that the axle on a tank car broke, causing the derailment and resulting in a tank rupture and release of LPG, after the car hit an obstacle placed on the side of the track by the Italian Railway. The Public Prosecutors further allege that a crack in the axle was detectable at the time of final inspection but was overlooked by the Employees at the Jungenthal Waggon GmbH workshop (a subsidiary of GATX Rail Austria). The trial in the Court of Lucca (the “Lucca Trial”) commenced on November 13, 2013.

With respect to civil claims, GRA’s insurers continue to work cooperatively with the insurer for the Italian Railway to adjust and settle personal injury and property damage claims. These joint settlement efforts have so far settled most of the significant civil claims related to the accident; however, approximately 90 civil claimants did not settle and are currently parties to the Lucca Trial. The Court of Lucca will determine both the civil and criminal liability of the defendants in the one proceeding. GRA believes that it and its Employees acted diligently and properly with respect to applicable legal and industry standards, but expects that its insurers will cover any civil damages if awarded to the claimants in the Lucca trial.

Since May 2012, the excess insurer providing coverage, Liberty Mutual Insurance Europe Limited (“Liberty”) has settled civil claims but has refused to reimburse GRA for its ongoing legal defense fees and costs, taking a position contrary to insurers in the prior underlying layers who had provided coverage for such expenses. To date, GRA has incurred approximately $5.6 million in unreimbursed defense fees and costs at the Liberty coverage layer and continues to incur costs in connection with the Lucca Trial. Consequently, in October 2013, GRA filed an arbitration proceeding against Liberty seeking to recoup its unreimbursed defense fees and costs (the “Liberty Arbitration”). The Liberty excess layer is currently fully exhausted and, therefore, the issue of reimbursement for outstanding defense costs will now be determined by the four insurers in the next coverage layer, which includes 25% held by Liberty. GRA cannot predict the outcome of the Liberty Arbitration, the amount of defense fees and costs that ultimately may not be reimbursed by Liberty, or the positions other excess insurers in the current coverage layer may take with respect to defense fees and costs.

GATX cannot predict the outcome of the Lucca Trial or what other legal proceedings or claims, if any, may be initiated against GRA or its personnel, and, therefore, cannot reasonably estimate the possible amount or range of loss that may ultimately be incurred in connection with this accident. Accordingly, we have not established any accruals with respect to this matter.

11

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

NOTE 12. Financial Data of Business Segments

The financial data presented below depicts the profitability, financial position, and capital expenditures of each of our business segments.

We lease, operate, manage, and remarket long-lived, widely-used assets, primarily in the rail and marine markets. We also invest in joint ventures that complement our existing business activities. We report our financial results through fourprimary business segments: Rail North America, Rail International, American Steamship Company (“ASC”), and Portfolio Management.

Rail North America is comprised of our wholly owned operations in the United States, Canada, and Mexico, as well as two affiliate investments. Rail North America primarily provides railcars and locomotives pursuant to full-service leases under which it maintains the railcars, pays ad valorem taxes and insurance, and provides other ancillary services.

Rail International is comprised of our wholly owned European operations ("Rail Europe") and a recently established railcar leasing business in India ("Rail India"), as well as one development stage affiliate in China. Rail Europe leases railcars to customers throughout Europe pursuant to full-service leases under which it maintains the railcars and provides insurance, and other ancillary services.

ASC operates the largest fleet of US flagged vessels on the Great Lakes, providing waterborne transportation of dry bulk commodities such as iron ore, coal, limestone aggregates, and metallurgical limestone.

Portfolio Management provides leasing, shipping, asset remarketing and asset management services through a collection of diversified wholly owned assets and joint venture investments. Portfolio Management selectively invests in domestic marine assets and seeks to maximize the value of the existing portfolio of owned and managed assets and affiliate investments.

Segment profit is an internal performance measure used by the Chief Executive Officer to assess the performance of each segment in a given period. Segment profit includes all revenues, pretax earnings from affiliates, and net gains on asset dispositions that are attributable to the segments, as well as expenses that management believes are directly associated with the financing, maintenance, and operation of the revenue earning assets. Segment profit excludes selling, general and administrative expenses, income taxes, and certain other amounts not allocated to the segments. These amounts are included in Other.

We allocate debt balances and related interest expense to each segment based upon a predetermined fixed recourse leverage level expressed as a ratio of recourse debt (including off-balance-sheet debt) to equity. The leverage levels are 5:1 for Rail North America, 2:1 for Rail International, 1.5:1 for ASC, and 3:1 for Portfolio Management. We believe that by using this leverage and interest expense allocation methodology, each operating segment’s financial performance reflects appropriate risk-adjusted borrowing costs.

12

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

The following tables show certain segment data of each of our business segments (in millions):

	Rail North America			Rail International			ASC			Portfolio Management			Other			GATX Consolidated
Three Months Ended March 31, 2014
Profitability
Revenues
Lease revenue	$	194.9		$	47.2		$	1.1		$	7.4		$	—		$	250.6
Marine operating revenue	—			—			3.1			14.6			—			17.7
Other revenue	14.6			2.0			—			1.7			—			18.3
Total Revenues	209.5			49.2			4.2			23.7			—			286.6
Expenses
Maintenance expense	61.4			11.5			0.2			—			—			73.1
Marine operating expense	—			—			3.4			11.6			—			15.0
Depreciation expense	41.5			11.7			—			5.5			—			58.7
Operating lease expense	26.9			—			—			—			—			26.9
Other operating expense	4.8			1.4			—			0.4			—			6.6
Total Expenses	134.6			24.6			3.6			17.5			—			180.3
Other Income (Expense)
Net gain (loss) on asset dispositions	24.8			2.4			(0.4		)	1.3			—			28.1
Interest expense, net	(24.6		)	(6.2		)	(1.4		)	(6.8		)	(3.0		)	(42.0		)
Other (expense) income	(3.4		)	—			—			0.3			(0.3		)	(3.4		)
Share of affiliates' earnings (pretax)	3.3			(0.1		)	—			10.9			—			14.1
Segment Profit (Loss)	$	75.0		$	20.7		$	(1.2	)	$	11.9		$	(3.3	)	103.1
Selling, general and administrative expense																42.7
Income taxes (including $4.2 related to affiliates' earnings)																18.3
Net Income																$	42.1
Net Gain on Asset Dispositions
Asset Remarketing Income:
Disposition gains on owned assets	$	21.6		$	—		$	—		$	—		$	—		$	21.6
Residual sharing income	0.6			—			—			1.2			—			1.8
Non-remarketing disposition gains (1)	2.6			2.4			—			—			—			5.0
Asset impairment	—			—			(0.4		)	0.1			—			(0.3		)
	$	24.8		$	2.4		$	(0.4	)	$	1.3		$	—		$	28.1
Capital Expenditures
Portfolio investments and capital additions	$	396.0		$	39.3		$	8.3		$	—		$	1.9		$	445.5
Selected Balance Sheet Data at March 31, 2014
Investments in affiliated companies	$	21.9		$	1.9		$	—		$	324.7		$	—		$	348.5
Identifiable assets	$	4,186.8		$	1,327.1		$	267.1		$	854.6		$	483.4		$	7,119.0

_____

(1) Includes scrapping gains.

13

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

	Rail North America			Rail International			ASC			Portfolio Management			Other			GATX Consolidated
Three Months Ended March 31, 2013
Profitability
Revenues
Lease revenue	$	183.8		$	43.0		$	1.1		$	9.3		$	—		$	237.2
Marine operating revenue	—			—			12.3			6.2			—			18.5
Other revenue	13.8			2.2			—			0.6			—			16.6
Total Revenues	197.6			45.2			13.4			16.1			—			272.3
Expenses
Maintenance expense	54.6			11.5			0.6			—			—			66.7
Marine operating expense	—			—			9.8			6.8			—			16.6
Depreciation expense	42.3			10.1			—			5.5			—			57.9
Operating lease expense	32.3			—			—			—			—			32.3
Other operating expense	4.0			0.9			—			0.4			—			5.3
Total Expenses	133.2			22.5			10.4			12.7			—			178.8
Other Income (Expense)
Net gain on asset dispositions	10.2			1.2			—			5.3			—			16.7
Interest expense, net	(25.7		)	(5.6		)	(1.6		)	(6.7		)	(1.3		)	(40.9		)
Other (expense) income	(0.8		)	0.5			(0.6		)	—			(0.2		)	(1.1		)
Share of affiliates' earnings (pretax)	2.2			(0.2		)	—			10.5			—			12.5
Segment Profit (Loss)	$	50.3		$	18.6		$	0.8		$	12.5		$	(1.5	)	80.7
Selling, general and administrative expense																42.0
Income taxes (including $4.1 related to affiliates' earnings)																11.6
Net Income																$	27.1
Net Gain on Asset Dispositions
Asset Remarketing Income:
Disposition gains on owned assets	$	1.6		$	—		$	—		$	4.2		$	—		$	5.8
Residual sharing income	2.8			—			—			1.1			—			3.9
Non-remarketing disposition gains (1)	6.5			1.4			—			—			—			7.9
Asset impairment	(0.7		)	(0.2		)	—			—			—			(0.9		)
	$	10.2		$	1.2		$	—		$	5.3		$	—		$	16.7
Capital Expenditures
Portfolio investments and capital additions	$	85.7		$	44.3		$	3.2		$	16.0		$	0.7		$	149.9
Selected Balance Sheet Data at December 31, 2013
Investments in affiliated companies	$	31.4		$	2.0		$	—		$	320.9		$	—		$	354.3
Identifiable assets	$	3,710.5		$	1,297.1		$	271.0		$	856.9		$	414.1		$	6,549.6

_____

(1) Includes scrapping gains.

14

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

FORWARD-LOOKING STATEMENTS

Our interim Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") should be read in conjunction with the MD&A in our Annual Report on Form 10-K for the year ended December 31, 2013. Our MD&A includes forward-looking statements, as defined by Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are subject to the safe harbor provisions of those sections and the Private Securities Litigation Reform Act of 1995. Forward-looking statements refer to information that is not purely historical, such as estimates, projections and statements relating to our business plans, objectives and expected operating results, and the assumptions on which those statements are based. Some of these statements may be identified by words like “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “predict,” “project” or other similar words. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties that could cause actual results or developments to differ materially from the forward-looking statements.

A detailed discussion of the known material risks and uncertainties that could cause actual results and events to differ materially from such forward-looking statements is included in our Annual Report on Form 10-K for the year ended December 31, 2013, and in our other filings with the Securities and Exchange Commission. Specific risks and uncertainties include, but are not limited to, (1) changes in regulatory requirements for tank cars in crude, ethanol, and other flammable liquid commodity service, (2) competitive factors in our primary markets, including lease pricing and asset availability, (3) weak economic conditions, financial market volatility, and other factors that may negatively affect the rail, marine, and other industries served by us and our customers, (4) inability to maintain satisfactory lease rates or utilization levels for our assets, or increased operating costs in our primary operating segments, (5) changes to laws, rules, and regulations applicable to GATX and our rail, marine, and other assets, or failure to comply with those laws, rules and regulations, (6) operational disruption and increased costs associated with compliance maintenance programs and other maintenance initiatives, (7) financial and operational risks associated with long-term railcar purchase commitments, (8) deterioration of conditions in the capital markets, reductions in our credit ratings, or increases in our financing costs, (9) unfavorable conditions affecting certain assets, customers or regions where we have a large investment, (10) risks related to our international operations and expansion into new geographic markets, (11) inadequate allowances to cover credit losses in our portfolio or declines in the credit quality of our customer base, (12) impaired asset charges that may result from weak economic or market conditions, changes to laws, rules, and regulations affecting our assets, events related to particular customers or asset types, or portfolio management decisions we implement, (13) environmental remediation costs or a negative outcome in our pending or threatened litigation, (14) our inability to obtain cost-effective insurance, (15) operational and financial risks related to our affiliate investments, particularly where certain affiliates may contribute significantly to our consolidated operating profit, (16) reduced opportunities to generate asset remarketing income, and (17) failure to successfully negotiate collective bargaining agreements with the unions representing a substantial portion of our employees.

Given these risks and uncertainties, readers are cautioned not to place undue reliance on these forward-looking statements, which reflect our analysis, judgment, belief or expectation only as of the date hereof. We have based these forward-looking statements on information currently available and disclaim any intention or obligation to update or revise these forward-looking statements to reflect subsequent events or circumstances.

BUSINESS OVERVIEW

We lease, operate, manage, and remarket long-lived, widely-used assets, primarily in the rail and marine markets. We also invest in joint ventures that complement our existing business activities. We report our financial results through fourprimary business segments: Rail North America, Rail International, American Steamship Company (“ASC”), and Portfolio Management.

We based the discussion and analysis that follows on financial data we derived from the financial statements prepared in accordance with GAAP and on certain other financial data that we prepared using non-GAAP components. For a reconciliation of these non-GAAP components to the most comparable GAAP components, see “Non-GAAP Financial Measures” at the end of this item.

Operating results for the three months ended March 31, 2014, are not necessarily indicative of the results we may achieve for the entire year ending December 31, 2014. For more information about our business, refer to our Annual Report on Form 10-K for the year ended December 31, 2013.

15

DISCUSSION OF OPERATING RESULTS

The following table shows a summary of our reporting segments and consolidated financial results for the three months ended March 31 (in millions, except per share data and percentages):

	2014			2013
Segment Revenues
Rail North America	$	209.5		$	197.6
Rail International	49.2			45.2
ASC	4.2			13.4
Portfolio Management	23.7			16.1
	$	286.6		$	272.3
Segment Profit (Loss)
Rail North America	$	75.0		$	50.3
Rail International	20.7			18.6
ASC	(1.2		)	0.8
Portfolio Management	11.9			12.5
	106.4			82.2
Less:
Selling, general and administrative expense	42.7			42.0
Unallocated interest expense, net	3.0			1.3
Other, including eliminations	0.3			0.2
Income taxes ($4.2 and $4.1 related to affiliates' earnings)	18.3			11.6
Net Income	$	42.1		$	27.1
Net income, excluding tax adjustments and other items	$	42.1		$	28.4
Diluted earnings per share	$	0.90		$	0.57
Diluted earnings per share, excluding tax adjustments and other items	$	0.90		$	0.60
Return on equity ("ROE") (1)	13.9		%	11.2		%
ROE, excluding tax adjustments and other items (1)	13.5		%	10.8		%
Investment Volume	$	445.5		$	149.9

_________

(1) For the trailing twelve months.

Net income was $42.1 million, or $0.90 per diluted share, for the first quarter of 2014 compared to $27.1 million, or $0.57 per diluted share, for the first quarter of 2013. The 2014 first quarter results include an after-tax benefit of $3.5 million, or $0.08 per diluted share, from a change in the depreciable lives of the North American railcar fleet. Results in 2013 included a $1.3 million loss related to certain interest rate swaps at Ahaus Alstätter Eisenbahn Cargo AG (“AAE”), which we have summarized in "Non-GAAP Financial Measures" at the end of MD&A. Excluding the impact of the AAE item in the first quarter of 2013, net income increased $13.7 million compared to the prior year. The increase in 2014 was driven by increased asset remarketing income and higher railcar lease rates, partially offset by higher maintenance costs due to increased compliance work.

Segment Operations

Segment profit is an internal performance measure used by the Chief Executive Officer to assess the performance of each segment in a given period. Segment profit includes all revenues, pretax earnings from affiliates, and net gains on asset dispositions that are attributable to the segments, as well as expenses that management believes are directly associated with the financing, maintenance, and operation of the revenue earning assets. Segment profit excludes selling, general and administrative expenses, income taxes, and certain other amounts not allocated to the segments. These amounts are included in Other.

16

RAIL NORTH AMERICA

Segment Summary

In March 2014, we entered into an agreement to purchase General Electric Railcar Services Corporation's ("GE Rail") per diem boxcar fleet, consisting of more than 18,500 cars for approximately $340.0 million. This fleet acquisition establishes us as the leader in the North American boxcar leasing market and added a significant number of railcars to our fleet that are critical-use assets for certain important sectors of the North American economy. Many of the lessees utilizing this fleet are existing customers, and this acquisition enhances our ability to meet these customers' broad rail transportation needs. The average age of the fleet is 34 years relative to the statutory life of 50 years. As this fleet purchase was completed at the end of the quarter, there was no meaningful impact on reported quarterly financial results. Accordingly, these railcars have been excluded from all fleet statistics noted herein.

During the first quarter of 2014, Rail North America continued to experience strong demand for tank cars and broadening demand for freight cars. The weighted average lease renewal rate on cars in our Lease Price Index (the “LPI,” see definition below) increased 33.9% from the weighted average expiring lease rate, compared to an increase of 37.1% in the fourth quarter of 2013 and 30.8% in the first quarter of 2013. Lease terms on renewals for cars in the LPI averaged 62 months in the current quarter, compared to 60 months in the fourth quarter of 2013 and 65 months in the first quarter of 2013. During the first quarter of 2014, an average of approximately 107,000 railcars were on lease compared to 108,000 during the fourth quarter of 2013 and 107,000 during the first quarter of 2013. Utilization was 98.5% at the end of the first quarter comparable to the prior quarter and 97.8% at March 31, 2013.

For the remainder of 2014, we expect higher lease revenue and increased maintenance expense as we work through our tank car compliance cycle. Leases on approximately 16,000 railcars will expire over the balance of the year and we expect to realize strong renewal success at attractive rates, particularly for tank cars. The number of idle cars that serve the coal market declined in the quarter. Although lease rates have improved materially, they remain below historical norms in this sector.

The following table shows Rail North America's segment results for the three months ended March 31 (in millions):

	2014			2013
Revenues
Lease revenue	$	194.9		$	183.8
Other revenue	14.6			13.8
Total Revenues	209.5			197.6
Expenses
Maintenance expense	61.4			54.6
Depreciation expense	41.5			42.3
Operating lease expense	26.9			32.3
Other operating expense	4.8			4.0
Total Expenses	134.6			133.2
Other Income (Expense)
Net gain on asset dispositions	24.8			10.2
Interest expense, net	(24.6		)	(25.7		)
Other expense	(3.4		)	(0.8		)
Share of affiliates' earnings (pretax)	3.3			2.2
Segment Profit	$	75.0		$	50.3
Investment Volume	$	396.0		$	85.7

17

The following table shows the components of Rail North America's lease revenue for the three months ended March 31 (in millions):

	2014		2013
Railcars	$	186.7	$	176.1
Locomotives	8.2		7.7
	$	194.9	$	183.8

Lease Price Index

Our LPI is an internally-generated business indicator that measures lease rate pricing on renewals for our North American railcar fleet. We calculate the index using the weighted average lease rate for a group of railcar types that we believe best represents our overall North American fleet. The average renewal lease rate change is reported as the percentage change between the average renewal lease rate and the average expiring lease rate, weighted by fleet composition. The average renewal lease term is reported in months and reflects the average renewal lease term of railcar types in the LPI, weighted by fleet composition.

18

Rail North America Fleet Data

The following table shows fleet activity for Rail North America railcars (1):

	March 31 2013		June 30 2013		September 30 2013		December 31 2013		March 31 2014
Beginning balance	109,551		109,637		110,774		109,955		109,113
Cars added	988		2,035		914		1,179		548
Cars scrapped	(810	)	(456	)	(308	)	(254	)	(380	)
Cars sold	(92	)	(442	)	(1,425	)	(1,767	)	(920	)
Ending balance	109,637		110,774		109,955		109,113		108,361
Utilization rate at quarter end	97.8	%	98.2	%	98.5	%	98.5	%	98.5	%
Average active railcars	106,964		107,722		108,452		108,021		106,985

_________

(1) Rail North America's fleet statistics exclude the acquisition of the per diem boxcar fleet, consisting of approximately 18,100 cars.

The following table shows fleet activity for Rail North America locomotives:

	March 31 2013		June 30 2013		September 30 2013		December 31 2013		March 31 2014
Beginning balance	561		564		558		589		595
Locomotives added	36		10		31		6		6
Locomotives scrapped or sold	(33	)	(16	)	—		—		(1	)
Ending balance	564		558		589		595		600
Utilization rate at quarter end	94.0	%	95.2	%	97.8	%	98.2	%	98.8	%
Average active locomotives	525		528		555		579		586

19

Comparison of the First Quarter of 2014 to the First Quarter of 2013

Segment Profit

In the first quarter of 2014, segment profit increased to $75.0 million, compared to $50.3 million in 2013. The increase was driven by increased asset remarketing income and higher lease rates, partially offset by higher maintenance costs due to increased compliance work. The results in 2014, compared to 2013, were also favorably impacted by a change in depreciation implemented during the quarter. Effective January 1, 2014, we revised the depreciable lives of our North American railcars based on a review of the current economic lives and usage of various railcar types. In aggregate, the average depreciable life of the fleet increased approximately 2.2 years.

Revenues

In the first quarter of 2014, lease revenue increased $11.1 million, primarily due to higher lease rates in the current quarter. Other revenue increased $0.8 million, primarily due to higher repair revenue in the current quarter.

Expenses

Maintenance expense increased $6.8 million in 2014, primarily due to the expected increase in compliance costs. Depreciation expense decreased $0.8 million, as the impact of the accounting policy change in estimated useful lives on the railcar fleet implemented as of January 1, 2014, substantially offset incremental depreciation from new investments. Operating lease expense decreased $5.4 million, due to the acquisition of railcars previously leased in under operating leases. Other operating expense increased $0.8 million due to a provision for loss adjustment made in the prior year.

Other Income (Expense)

In the first quarter of 2014, net gain on asset dispositions increased $14.6 million compared to the prior period as we sold approximately 800 more railcars, the impact of which was partially offset by lower scrapping gains. The prior quarter also included a $2.7 million fee on the early termination of a residual value guarantee. Net interest expense decreased $1.1 million driven by lower average rates which reflected the prepayment of certain higher cost secured financing in the prior year. Other expense increased $2.6 million, primarily due to termination costs associated with the early buyout of an operating lease. Share of affiliates' earnings increased $1.1 million, primarily due to gains on dispositions of railcars from our Southern Capital affiliate.

Investment Volume

During the first quarter of 2014, investment volume was $396.0 million compared to $85.7 million in 2013, and included the purchase of approximately 18,100 per diem boxcars from GE Rail (out of total of 18,500 to be acquired). In addition, 464 newly built railcars were acquired, compared to 520 newly built railcars and 303 railcars purchased in the secondary market in 2013.

North American Rail Regulatory Matters

Recent derailments involving trains carrying crude oil and ethanol have led to increased regulatory scrutiny in the US and Canada of railroad operations, shippers' classification of products, and the tank cars carrying flammable liquids. In September 2013, the Pipeline and Hazardous Materials Safety Administration of the US Department of Transportation (“PHMSA”) issued an Advance Notice of Proposed Rulemaking (the “ANPRM”) seeking public comment on potential design enhancements to certain tank cars, commonly referred to as DOT 111 tank cars, used to transport crude oil, ethanol and other flammable liquids. We participated in the public comment process through The Railway Supply Institute, a rail industry trade association which submitted comments on the ANPRM. The ANPRM did not propose specific design enhancements or retirement schedules for the existing fleet of tank cars in flammable liquids service. However, PHMSA has projected that it will publish proposed rules by July 30, 2014, which would be followed by a 60-day public comment period. While this schedule is subject to change, it is possible that final rules could be adopted by the end of 2014. We have approximately 4,600 tank cars currently in crude and ethanol service and another 8,300 cars in flammable liquids service in North America.

On April 23, 2014, Transport Canada (“TC”) issued an order prohibiting the use of certain types of tank cars in dangerous goods service in Canada effective immediately. The cars affected by this order include certain tank cars made of non-normalized steel and lacking continuous reinforcement and heater coils along the bottom of the tank. We have approximately 100 of these cars in our fleet currently

20

operating in this service in Canada, and therefore, we do not expect TC’s order to have a material impact on our fleet. TC simultaneously announced that it intends to propose rules in the summer of 2014 requiring all tank cars in crude and ethanol service in Canada that do not comply with the rail industry’s CPC-1232 design standard to be either phased out or retrofitted by May 1, 2017. The CPC-1232 standard was voluntarily adopted by the rail industry in 2011 and includes design enhancements intended to improve tank car safety in the event of an accident. Of the approximately 4,600 tank cars in our North American fleet currently in crude and ethanol service, approximately 3,700 were manufactured prior to adoption of the CPC-1232 standard. TC also announced that it intends to coordinate with US regulators to determine what additional requirements may be needed for the entire North American fleet of DOT 111 tank cars in flammable liquids service. Until PHMSA and TC release their proposed rules, we will be unable to assess how any new regulations may impact GATX and what changes may be required with respect to our tank cars in flammable liquids service, including the number of cars that could be phased out and the timing of any proposed phase out, as well as the scope and cost of any retrofit program.

RAIL INTERNATIONAL

Segment Summary

Within Rail International, the European railcar market is stable and Rail Europe continues to invest in new tank cars and scrap older equipment. Investment volume was $33.9 million and we anticipate a strong investment year in 2014. At the end of the first quarter of 2014, our fleet utilization was 95.8% compared to 96.4% at the end of 2013 and 93.4% at March 31, 2013. Rail India continues to pursue railcar leasing and investment opportunities.

The following table shows Rail International's segment results for the three months ended March 31 (in millions):

	2014			2013
Revenues
Lease revenue	$	47.2		$	43.0
Other revenue	2.0			2.2
Total Revenues	49.2			45.2
Expenses
Maintenance expense	11.5			11.5
Depreciation expense	11.7			10.1
Other operating expense	1.4			0.9
Total Expenses	24.6			22.5
Other Income (Expense)
Net gain on asset dispositions	2.4			1.2
Interest expense, net	(6.2		)	(5.6		)
Other income	—			0.5
Share of affiliates' earnings (pretax)	(0.1		)	(0.2		)
Segment Profit	$	20.7		$	18.6
Investment Volume	$	39.3		$	44.3

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The following table shows fleet activity for Rail International railcars:

	March 31 2013		June 30 2013		September 30 2013		December 31 2013		March 31 2014
Beginning balance	21,840		22,012		21,986		22,041		22,019
Cars added	361		492		349		313		125
Cars scrapped or sold	(189	)	(518	)	(294	)	(335	)	(370	)
Ending balance	22,012		21,986		22,041		22,019		21,774
Utilization rate at quarter end	93.4	%	95.6	%	96.2	%	96.4	%	95.8	%
Average active railcars	20,741		20,860		21,091		21,231		21,051

Comparison of the First Three Months of 2014 to the First Three Months of 2013

Foreign Currency

Segment profit for Rail International is impacted by changes in the exchange rate of foreign currencies, primarily the Euro. In the first quarter of 2014, a modestly stronger Euro contributed $1.6 million to the increase in lease revenue and $0.9 million to the increase in segment profit compared to the first quarter in 2013.

Segment Profit

Segment profit was $20.7 million in 2014 compared to $18.6 million in 2013. The prior year included a loss of $1.4 million related to certain interest rate swaps at Ahaus Alstätter Eisenbahn Cargo AG (“AAE”). We sold our interest in AAE in the third quarter of 2013. Excluding the impact of this item, segment profit increased $0.7 million. This increase was driven by increased lease revenue due to more railcars on lease and higher lease rates, partially offset by the absence of operating income from our interest in AAE.

Revenues

Lease revenue increased $4.2 million, primarily due to more railcars on lease, higher lease rates, and the effects of a stronger Euro.

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Expenses

Depreciation expense increased $1.6 million, primarily due to new cars added to the fleet. Other operating expense increased $0.5 million, primarily due to higher switching and freight costs.

Other Income (Expense)

Net gain on asset dispositions increased $1.2 million due to more railcars being scrapped. Scrapping and replacement of older cars continued in the current quarter as we assist our customers in upgrading the tank car fleet in the European market. Net interest expense increased $0.6 million due to higher debt balances. Other (expense) income decreased $0.5 million, primarily due to the net effects of favorable exchange rate movements on non-functional currency items in the prior quarter. Excluding the impact of the AAE interest rate swap in the prior year, share of affiliates' earnings decreased $1.3 million due to the absence of AAE operating results in 2014.

Investment Volume

During the first quarter of 2014, investment costs, which include progress payments on scheduled deliveries of new railcars and car improvements, were $39.3 million compared to $44.3 million in 2013. During the first quarter of 2014, we took delivery of approximately 48 railcars compared to 310 railcars in 2013.

ASC

Segment Summary

Our fleet is largely inactive for the first three months of each year due to the winter conditions on the Great Lakes. 2014 was particularly impacted by severe winter conditions. Great Lakes ice coverage and Coast Guard restrictions have delayed vessel deployment resulting in limited vessel operations. Only two vessels were in service at the end of the quarter, compared to ten in the prior year. During the first quarter of 2014, ASC carried a total of 0.4 million net tons of freight, substantially all of which was attributable to prior year commitments completed in January, compared to 1.5 million net tons during the first quarter of 2013. Delayed vessel deployment provides less time to meet customer requirements; however, ASC anticipates that all customer commitments will be fulfilled in 2014.

The following table shows ASC’s segment results for the three months ended March 31 (in millions):

	2014			2013
Revenues
Lease revenue	$	1.1		$	1.1
Marine operating revenue	3.1			12.3
Total Revenues	4.2			13.4
Expenses
Maintenance expense	0.2			0.6
Marine operating expense	3.4			9.8
Total Expenses	3.6			10.4
Other Income (Expense)
Net loss on asset dispositions	(0.4		)	—
Interest expense, net	(1.4		)	(1.6		)
Other expense	—			(0.6		)
Segment (Loss) Profit	$	(1.2	)	$	0.8
Investment Volume	$	8.3		$	3.2

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Comparison of the First Three Months of 2014 to the First Three Months of 2013

Segment (Loss) Profit

Segment results were $2.0 million lower than prior year. The variance was attributable to ice coverage on the Great Lakes leading to lower freight volume.

Revenues

Marine operating revenue decreased $9.2 million, due to the limited vessel operations related to the ice conditions.

Expenses

Net loss on asset dispositions of $0.4 million was due to an additional impairment on the American Fortitude as we reduced our expectations of scrapping proceeds for the vessel.

Other Income (Expense)

Other expense in the prior year reflects $0.6 million of litigation settlement costs.

Investment Volume

ASC's investments in each period consisted of structural and mechanical upgrades to our vessels.

PORTFOLIO MANAGEMENT

Segment Summary

Portfolio Management's total asset base was $854.6 million at March 31, 2014 compared to $856.9 million at December 31, 2013, and $766.3 million at March 31, 2013. The estimated net book value equivalent of assets managed by Portfolio Management for third parties was $110.5 million at March 31, 2014. The environment for investment in domestic marine assets continues to be challenging as relatively cheap sources of capital are aggressively pursuing this asset class. Weak demand and vessel overcapacity continue to pressure operating results from our ocean-going vessel pooling arrangements.

The Rolls-Royce & Partners Finance companies (collectively the "RRPF affiliates") continue to experience solid results driven by strong demand for spare aircraft engines. Segment profit included earnings from the RRPF affiliates of $10.5 million for the first quarter of 2014, compared to $8.3 million in 2013.

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The following table shows Portfolio Management's segment results for the three months ended March 31 (in millions):

	2014			2013
Revenues
Lease revenue	$	7.4		$	9.3
Marine operating revenue	14.6			6.2
Other revenue	1.7			0.6
Total Revenues	23.7			16.1
Expenses
Marine operating expense	11.6			6.8
Depreciation expense	5.5			5.5
Operating lease expense	—			—
Other operating expense	0.4			0.4
Total Expenses	17.5			12.7
Other Income (Expense)
Net gain on asset dispositions	1.3			5.3
Interest expense, net	(6.8		)	(6.7		)
Other income	0.3			—
Share of affiliates' earnings (pretax)	10.9			10.5
Segment Profit	$	11.9		$	12.5
Investment Volume	$	—		$	16.0

The following table shows the approximate net book values of Portfolio Management's assets (in millions):

	March 31 2013		June 30 2013		September 30 2013		December 31 2013		March 31 2014
Net book value of owned assets	$	407.6	$	521.0	$	523.2	$	536.0	$	529.9
Affiliate investments	358.7		307.0		328.3		320.9		324.7
Net book value of managed portfolio	140.7		129.1		128.0		125.3		110.5

Comparison of the First Three Months of 2014 to the First Three Months of 2013

Segment Profit

Segment profit of $11.9 million was $0.6 million lower than the prior year. This decrease was driven by lower gains on asset dispositions and lower lease revenues, partially offset by higher earnings from the RRPF affiliates. Comparison between periods is impacted by the five vessels formerly included with our Singco and Somargas affiliates, which are now wholly owned (the "Norgas vessels").

Revenues

Lease revenue was $1.9 million lower in the first quarter of 2014, primarily due to the sale of barges and other equipment in the prior year. Marine operating revenue was $8.4 million higher than prior year, primarily due to revenue earned by the Norgas vessels. Other revenue was $1.1 million higher than prior year, primarily due to distributions from an investment fund and a restitution payment received on a legacy transaction.

Expenses

Marine operating expense was $4.8 million higher than prior year, primarily due to expenses from the Norgas vessels.

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Other Income (Expense)

Net gain on asset dispositions in the first quarter of 2014 was $4.0 million lower than prior year, primarily due to fewer asset dispositions. Other income was $0.3 million higher than prior year due to proceeds received from the exercise of warrants in 2014.

Share of affiliates' earnings in the first quarter of 2014 was $0.4 million higher than the prior year, primarily due to higher income at RRPF partially offset by the absence of earnings from our former Singco and Somargas affiliates.

Investment Volume

There were no investments in the first quarter of 2014. Investment volume of $16.0 million in the prior year period included an $8.5 million loan for a dry bulk vessel and $7.1 million of container assets.

OTHER

Other is comprised of selling, general and administrative expenses (“SG&A”), unallocated interest expense, and miscellaneous income and expense not directly associated with the reporting segments and eliminations.

The following table shows components of Other for the three months ended March 31 (in millions):

	2014		2013
Selling, general and administrative expense	$	42.7	$	42.0
Unallocated interest expense, net	3.0		1.3
Other expense (including eliminations)	0.3		0.2

SG&A, Unallocated Interest and Other

In the first three months of 2014, SG&A increased $0.7 million from the prior year, primarily due to higher salaries, IT costs, and consulting fees partially offset by lower pension expense. Unallocated interest expense (the difference between external interest expense and interest expense allocated to the reporting segments in accordance with assigned leverage targets) in any period is affected by our consolidated leverage position as well as the timing of debt issuances and investing activities. Other expense and eliminations were immaterial for each of the periods.

Consolidated Income Taxes

Our effective tax rate was 30% for the three months ended March 31, 2014, compared to 29% for the three months ended March 31, 2013. The difference in the effective rates for each period, compared to the statutory rate of 35%, is primarily attributable to the mix of pretax income in each year among domestic and foreign jurisdictions which are taxed at different rates.

CASH FLOW AND LIQUIDITY

We generate a significant amount of cash from operating activities and from our investment portfolio. We also access domestic and international capital markets by issuing unsecured or secured debt and commercial paper. We use these sources of cash, along with our available cash balances, to fulfill our debt, lease, and dividend obligations and to fund portfolio investments and capital additions. We primarily use cash from operations and commercial paper issuances to fund daily operations.

The timing of asset dispositions and changes in working capital impacts cash flows from operations and portfolio proceeds. As a result, these cash flow components may vary materially from quarter to quarter and year to year. As of March 31, 2014, we had unrestricted cash balances of $447.0 million.

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The following table shows our principal sources and uses of cash for the three months ended March 31 (in millions):

	2014			2013
Principal sources of cash
Net cash provided by operating activities	$	51.4		$	24.2
Portfolio proceeds	66.6			64.5
Other asset sales	7.0			8.7
Proceeds from issuance of debt, commercial paper, and credit facilities	857.0			597.9
	$	982.0		$	695.3
Principal uses of cash
Portfolio investments and capital additions	$	(445.5	)	$	(149.9	)
Repayments of debt, commercial paper, and credit facilities	(307.1		)	(414.6		)
Purchases of leased-in assets	(150.5		)	(11.3		)
Payments on capital lease obligations	(1.3		)	(1.2		)
Cash dividends	(16.9		)	(16.3		)
Stock repurchases	—			(18.3		)
	$	(921.3	)	$	(611.6	)

Net cash provided by operating activities of $51.4 million increased $27.2 million compared to 2013. The increase was primarily driven by higher lease income, affiliate distributions, and other net changes in working capital.

Portfolio proceeds for the first three months of 2014 of $66.6 million increased by $2.1 million from the prior year, primarily due to higher proceeds from sales of equipment.

Proceeds from the issuance of debt for the first three months of 2014 were $857.0 million (net of hedges and debt issuance costs). In North America, issuances consisted of $850.0 million of unsecured debt which included $300.0 million of 3-year notes, $250.0 million of 5-year notes, and $300.0 million of 30-year notes. Debt repayments of $307.1 million for the first three months of 2014 were $107.5 million lower than prior year. Each year included scheduled maturities in addition to the early retirement of higher cost debt.

Portfolio investments and capital additions primarily consist of purchases of operating assets, investments in affiliates, loans, and capitalized asset improvements. See individual segment discussions for further information on investment volume. In the first quarter of 2014, we acquired a fleet of approximately 18,100 boxcars from GE Rail for $330.7 million.

In the first quarter of 2014 our board of directors authorized a $250 million share repurchase program. As of March 31, 2014, the full amount was available under the repurchase authorization.

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Short-Term Borrowings

The following table provides additional information regarding our short-term borrowings for the three months ended March 31, 2014:

	Europe (1)
Balance as of March 31 (in millions)	$	38.2
Weighted average interest rate	1.1		%
Euro/Dollar exchange rate	1.38
Average monthly amount outstanding during the quarter (in millions)	$	30.9
Weighted average interest rate	1.4		%
Average Euro/Dollar exchange rate	1.37
Maximum month-end amount outstanding during the quarter (in millions)	$	38.2
Euro/Dollar exchange rate	1.38

_________

(1) Short-term borrowings in Europe are comprised of borrowings under bank credit facilities.

Revolving Credit Facility

As of March 31, 2014, we had a $575 million 5-year unsecured credit facility in the US that matures in April 2018. As of March 31, 2014, the full $575 million was available under the facility.

Restrictive Covenants

Our $575 million revolving credit facility contains various restrictive covenants, including requirements to maintain a fixed charge coverage ratio and an asset coverage test. Some of our bank term loans have the same financial covenants as the facility.

The indentures for our public debt also contain various restrictive covenants, including limitation on liens provisions that limit the amount of additional secured indebtedness that we may incur. Additionally, certain exceptions to the covenants permit us to incur an unlimited amount of purchase money and nonrecourse indebtedness.

The loan agreements for our European rail subsidiaries (collectively, "GRE") also contain restrictive covenants, including leverage and cash flow covenants specific to those subsidiaries, restrictions on making loans, and limitations on the ability of those subsidiaries to repay loans or to distribute capital to certain related parties (including GATX, the US parent company). These covenants effectively limit GRE's ability to transfer funds to us.

We do not anticipate any covenant violations nor do we anticipate that any of these covenants will restrict our operations or our ability to obtain additional financing. At March 31, 2014, we were in compliance with all covenants and conditions of all of our credit agreements.

Credit Ratings

The global capital market environment and outlook may affect our funding options and our financial performance. Our access to capital markets at competitive rates depends on our credit rating and ratings outlook, as determined by rating agencies. As of March 31, 2014, our long-term unsecured debt was rated BBB by Standard & Poor's and Baa2 by Moody’s Investor Service and our short-term unsecured debt was rated A-2 by Standard & Poor's and P-2 by Moody’s Investor Service. Our rating outlook from both agencies was stable.

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Contractual Commitments

The following table shows our contractual commitments, including debt maturities, lease payments, and portfolio investments at March 31, 2014, (in millions):

	Payments Due by Period
	Total		2014		2015		2016		2017		2018		Thereafter
Recourse debt	$	4,315.5	$	362.1	$	546.5	$	642.4	$	460.3	$	514.1	$	1,790.1
Nonrecourse debt	70.3		54.3		9.0		7.0		—		—		—
Commercial paper and credit facilities	38.2		38.2		—		—		—		—		—
Capital lease obligations	8.4		1.5		3.1		2.7		1.1		—		—
Operating leases — recourse	860.6		43.4		131.1		107.7		95.4		86.7		396.3
Operating leases — nonrecourse	74.6		8.6		11.1		8.1		9.5		9.0		28.3
Portfolio investments (1)	1,035.8		443.7		401.2		144.6		39.6		6.7		—
	$	6,403.4	$	951.8	$	1,102.0	$	912.5	$	605.9	$	616.5	$	2,214.7

_________

(1) Primarily railcar purchase commitments.

Critical Accounting Policies

During the first quarter of 2014, we completed a review of the estimated useful lives used for our North American railcar fleet and determined that the economic service life of many of our railcars differed from the useful life currently used to calculate depreciation. As a result, effective January 1, 2014, we revised the estimated useful lives from a range of 30-38 years to a range of 27-42 years. In aggregate, the average depreciable life of the fleet increased approximately 2.2 years. The impact of these implemented changes on depreciation expense for affected assets in the first quarter of 2014 is a net decrease in depreciation expense of approximately $5.5 million and an increase in net income of $3.5 million, or $0.08 per diluted share. The full year impact for 2014 for affected assets is expected to be a decrease in depreciation expense of approximately $21.9 million and an increase in net income of $14.0 million, or approximately $0.30 per diluted share.

Otherwise, there have been no changes to our critical accounting policies during the three months ending March 31, 2014. Refer to our Annual Report on Form 10-K for the year ended December 31, 2013, for a summary of our policies.

NON-GAAP FINANCIAL MEASURES

We compute some financial measures using non-GAAP components, as defined by the SEC. 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. We include these non-GAAP financial measures to provide additional information and insight into our operating results and financial position. We use these measures in analyzing our financial performance from period to period and when making compensation decisions.

Glossary of Key Terms

• Non-GAAP financial measures — Numerical or percentage-based measures of a company’s historical performance, financial position, or liquidity calculated using a component different from that presented in the financial statements as prepared in accordance with GAAP.

• Net income excluding tax adjustments and other items — Net income excluding certain items that we believe are not necessarily related to our ongoing business activities.

• Diluted earnings per share excluding tax adjustments and other items — Diluted earnings per share excluding the impact of tax adjustments and other items.

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• Off-balance-sheet assets — Assets, primarily railcars, that are financed with operating leases and therefore not recorded on the balance sheet. We estimate the off-balance-sheet asset amount by calculating the present value of committed future operating lease payments using the interest rate implicit in each lease.

• On-balance-sheet assets — Total assets reported on the balance sheet.

• Return on equity — Net income divided by average shareholders’ equity.

• Return on equity excluding tax adjustments and other items — Net income excluding tax adjustments and other items divided by average shareholders’ equity.

Reconciliation of Non-GAAP Components used in the Computation of Certain Financial Measures

We disclose total on- and off-balance-sheet assets because a significant portion of our rail fleet has been financed through sale-leasebacks that are accounted for as operating leases and the assets are not recorded on the balance sheet. We believe this information provides investors with a better representation of the assets deployed in our businesses.

The following table shows total on- and off-balance-sheet assets (in millions):

	March 31 2013		June 30 2013		September 30 2013		December 31 2013		March 31 2014
Consolidated on-balance-sheet assets	$	6,144.7	$	6,119.2	$	6,339.1	$	6,549.6	$	7,119.0
Off-balance-sheet assets:
Rail North America	797.3		770.7		749.9		887.9		680.8
ASC	19.9		18.8		17.6		16.5		15.3
Total On- and Off-Balance Sheet Assets	$	6,961.9	$	6,908.7	$	7,106.6	$	7,454.0	$	7,815.1
Shareholders’ Equity	$	1,223.5	$	1,219.1	$	1,312.1	$	1,397.0	$	1,423.2

We exclude the effects of tax adjustments and other items when we present return on equity, net income, and diluted earnings per share. We exclude these items to provide a more meaningful comparison of financial performance between years and to provide transparency in our operating results.

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The following tables show our net income and diluted earnings per share excluding other items for the three months ended March 31 (in millions, except per share data):

Impact of Tax Adjustments and Other Items on Net Income:
	2014		2013
Net income	$	42.1	$	27.1
Adjustments to attributable to consolidated income:
Foreign tax credit carryforward	—		—
Income tax rate changes	—		—
Adjustments attributable to affiliates' earnings:
Losses on interest rate swaps at AAE, net of taxes	—		1.3
Tax rate changes	—		—
Net income excluding tax adjustments and other items	$	42.1	$	28.4

Impact of Tax Adjustments and Other Items on Diluted Earnings per Share:
	2014		2013
Diluted earnings per share	$	0.90	$	0.57
Adjustments attributable to consolidated income:
Foreign tax credit carryforward	—		—
Income tax rate changes	—		—
Adjustments attributable to affiliates' earnings:
Losses on interest rate swaps at AAE, net of taxes	—		0.03
Tax rate changes	—		—
Diluted earnings per share excluding tax adjustments and other items	$	0.90	$	0.60

The following table shows our net income excluding tax adjustments and other items for trailing twelve months ended March 31 (in millions):

	2014			2013
Net income	$	184.3		$	134.1
Adjustments attributable to consolidated income:
GATX income taxes on sale of AAE (1)	23.2			—
Foreign tax credit carryforward (2)	(3.9		)	(4.6		)
Income tax rate changes (3)	—			0.7
Tax benefits recognized upon the close of domestic and foreign tax audits	—			(15.5		)
Adjustments attributable to affiliates' earnings:
Pretax gain on sale of AAE (1)	(9.3		)	—
Interest rate swaps at AAE, net of taxes (4)	(8.2		)	19.6
Tax rate changes (3)	(7.6		)	(4.6		)
Net income excluding tax adjustments and other items	$	178.5		$	129.7

________

(1) Aggregate after-tax impact of the AAE sale, including the $3.9 million foreign credit carryforward, was a net loss of $10.0 million.(2) Represents benefits attributable to the utilization of foreign tax credit carryforwards.

(3) Deferred tax adjustments due to an enacted statutory rate increase in Ontario and statutory rate decreases in the United Kingdom.

(4) Represents realized and/or unrealized gains/losses on AAE interest rate swaps.

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

Since December 31, 2013, there have been no material changes in our interest rate and foreign currency exposures or types of derivative instruments used to hedge these exposures. For a discussion of our exposure to market risk, refer to "Item 7A. Quantitative and Qualitative Disclosure about Market Risk" of our Annual Report on Form 10-K for the year ended December 31, 2013.

Item 4. Controls and Procedures

We have conducted an evaluation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”)), with the participation of our Chief Executive Officer and Chief Financial Officer. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this quarterly report, our disclosure controls and procedures were effective.

No change in our internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) occurred during the quarter ended March 31, 2014 , that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings

Information concerning litigation and other contingencies is described in "Note 11. Legal Proceedings and Other Contingencies" in Part I, Item 1 of this Form 10-Q and is incorporated herein by reference.

Item 1A.  Risk Factors

Since December 31, 2013, there have been no material changes in our risk factors. For a discussion of our risk factors, refer to "Item 1A. Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2013.

Item 6.  Exhibits

Exhibits:

Reference is made to the exhibit index which is included herewith and is incorporated by reference hereto.

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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/ Robert C. Lyons

Robert C. Lyons

Executive Vice President and Chief Financial Officer

(Duly Authorized Officer)

Date: April 29, 2014

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EXHIBIT INDEX

Exhibit Number	Exhibit Description
	Filed with this Report:
10.1	Form of Performance Share Agreement with cash-election option for grants under the GATX Corporation 2012 Incentive Award Plan to executive officers with Agreements for Employment Following a Change of Control.*
10.2	Form of Agreement for Employment Following a Change of Control dated as of January 1, 2014, between GATX Corporation and Thomas A. Ellman.*
10.3	Form of Agreement for Employment Following a Change of Control dated as of January 1, 2014, between GATX Corporation and Paul F. Titterton.*
31A.	Certification Pursuant to Exchange Act Rule 13a-14(a) and Rule 15d-14(a) (CEO Certification).
31B.	Certification Pursuant to Exchange Act Rule 13a-14(a) and Rule 15d-14(a) (CFO Certification).
32.	Certification Pursuant to 18 U.S.C. Section 1350 (CEO and CFO Certification).
101.	The following materials from GATX Corporation’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets at March 31, 2014 and December 31, 2013, (ii) Consolidated Statements of Comprehensive Income for the three months ended March 31, 2014 and 2013, (iii) Consolidated Statements of Cash Flows for the three months ended March 31, 2014 and 2013, and (iv) Notes to the Consolidated Financial Statements.

________

(*) Compensatory Plans or Arrangements.

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EX-10.1

1 GATX CORPORATION 2012 INCENTIVE AWARD PLAN PERFORMANCE SHARE AGREEMENT FOR EXECUTIVE OFFICERS This PERFORMANCE SHARE AGREEMENT (this “Agreement”) is entered into as of January 30, 2014 (the “Grant Date”) by and between the Participant and GATX Corporation (the "Company") in respect of the performance period beginning on January 1, 2014 through and including December 31, 2016 (the “Performance Period”). WHEREAS, the Company maintains the GATX Corporation 2012 Incentive Award Plan (the "Plan"), which is incorporated into and forms a part of this Agreement, and the Participant has been selected by the Compensation Committee of the Board of Directors of the Company (the “Committee”), which has been charged with the responsibility of administering the Plan, to receive a grant of Performance Shares under the Plan; NOW, THEREFORE, IT IS AGREED, by and between the Company and the Participant as follows: 1. Defined Terms. Certain capitalized terms used in this Agreement are defined in paragraph 13 or elsewhere in this Agreement. Capitalized terms used but not defined herein shall have the meanings ascribed thereto in the Plan. 2. Award. Subject to the terms of the Plan and this Agreement, the Participant is hereby granted the number of Performance Shares approved by the Committee, subject to Section 3.1 and Article 5 of the Plan and as set forth on the Benefits Access website (https://www.benefitaccess.com) of Morgan Stanley Smith Barney (“MSSB”) or any successor administrator the Committee may designate from time to time to administer the Plan and this Agreement (the “Award”). Each Performance Share entitles the Participant to receive one share of Common Stock of the Company (each a “Share”) subject to the terms and conditions of this Agreement. 3. Voting Rights and Dividends. Notwithstanding anything to the contrary, the Participant shall not have any rights as a shareholder of the Company, including the right to vote, until the Participant actually receives Shares in accordance with paragraph 4 of this Agreement. An account shall be established for the Participant, to which shall be credited dividend equivalents equal to the product of (a) the number of the Participant’s Performance Shares and (b) the dividend declared on a single share of Common Stock. To the extent the participant becomes vested in Performance Shares, the Participant shall be entitled to a distribution of the dividend equivalents credited to his or her account if and when Shares are issued with respect to Performance Shares to which the Participant becomes entitled pursuant to paragraph 4 of this

2 Agreement. All dividend equivalents paid will be considered ordinary income and will be subject to supplemental withholding rates for income tax purposes including payroll taxes, applicable to such supplemental income. 4. Vesting, Transfer and Forfeiture. (a) Subject to the terms hereof, if the Company’s Total Gross Income Less Total Ownership Costs for each of the three years during the Performance Period (as reported on the Company’s audited income statement for each such year) is greater than $500,000,000 (the “Threshold Goal”) and the Committee certifies that the Threshold Goal has been achieved, the Participant shall be entitled to the number of Shares set forth in the 2012 resolutions of the Committee providing for the grant of this Performance Share award (the "Unadjusted Award Amount"). However, if the Threshold Goal for the Performance Period is not achieved and certified by the Committee, the Unadjusted Award Amount shall be zero. (b) After the end of the Performance Period, the Committee shall determine the number of the Participant's Performance Shares that have been earned for the Performance Period in accordance with the schedule set forth on Exhibit 1, weighted by the percentages set forth in the column captioned “Weight” on Exhibit 2 and calculated in the manner set forth on Exhibit 2 (provided that the determination under this subparagraph 4(b) shall be subject to modification as provided in paragraph 8 hereof). The date of the Committee’s determination under subparagraph 4(a) and 4(b) being the “Determination Date”. The Unadjusted Award Amount shall be reduced to the number of Performance Shares determined to be earned in accordance with the foregoing provisions of this subparagraph 4(b), and any unearned portion of the Unadjusted Award Amount or Performance Shares shall be forfeited. In no event shall the Performance Shares earned by the Participant exceed the Unadjusted Award Amount. (c) Notwithstanding anything in this Agreement to the contrary that requires delivery and payment of Shares, the Participant may elect, in his or her sole discretion in lieu of Shares, to receive from the Company cash equal to the Fair Market Value of the Shares (as of the Determination Date) that otherwise would be delivered and payable under the terms of this Agreement, provided that the following conditions are met: (i) the Participant is within five years of being retirement-eligible under the GATX Non-Contributory Pension Plan for Salaried Employees as of the last day of the Performance Period; or (ii) the Participant satisfies at least 150% of his or her ownership requirement under the Company’s stock retention policy as of the last day of the Performance Period; and (iii) such election is submitted in writing on such form as the Company may specify (the “Cash Election”). The Participant may submit a Cash Election only during any period in which the Participant is allowed to trade in the Company’s

3 Shares under the Company’s insider trading policy, but no later than the Determination Date for the Performance Period. If any of the foregoing conditions are not met, then the election will be void and the Participant shall receive payment under this Agreement in the form of Shares. Otherwise, an election to receive cash in lieu of Shares may not be revoked or changed once made. (d) As soon as practicable after the Determination Date, but not later than March 15 of the year following the end of the Performance Period, an equal number of Shares shall be transferred to the Participant. (e) Except as provided in subparagraph 4(f) below, if the Participant's Date of Termination occurs prior to the end of the Performance Period, the Participant shall forfeit all Performance Shares and rights under this Agreement. (f) Notwithstanding subparagraph 4(e) above, the Participant shall become vested in a number of earned Performance Shares hereunder, and shall become owner of an equal number of Shares in respect thereof, free and clear of all restrictions otherwise imposed by this Agreement, as follows: (i) If the Participant’s employment is involuntarily terminated by the Company other than for Cause, not less than eighteen (18) months following the beginning of the Performance Period but on or prior to the end of the Performance Period, the Participant will be entitled to a pro rata portion of his or her earned Performance Shares based on the length of his or her employment during the Performance Period. The pro rata portion of the Performance Shares shall equal the product of: (A) the number of Performance Shares to which the Participant would otherwise be entitled in accordance with the foregoing provisions of this paragraph 4 had his or her employment not been terminated; and (B) a fraction (not greater than one), the numerator of which is the number of days the Participant was employed by the Company or its Subsidiaries during the period beginning on the date of commencement of the Performance Period and ending on the Date of Termination, and the denominator of which is the number of days in the Performance Period. The Shares to which the Participant is entitled pursuant to this subparagraph 4(f)(i) shall be transferred to the Participant in the year following the end of the Performance Period as soon as

4 practical following the Determination Date , but not later than March 15 of the year following the end of the Performance Period. (ii) If the Participant's Date of Termination occurs by reason of the Participant's death, Retirement or Disability prior to the end of the Performance Period, the Participant will be entitled to receive a pro rata portion of his or her earned Performance Shares based on the length of his or her employment during the Performance Period. The pro rata portion of the Performance Shares shall equal the product of: (A) the number of Performance Shares to which the Participant would otherwise be entitled in accordance with the foregoing provisions of this paragraph 4 if no Date of Termination had occurred; and (B) a fraction (not greater than one), the numerator of which is the number of days during the period beginning on the date of commencement of the Performance Period and ending on the date of the Participant’s death, Retirement or Disability, and the denominator of which is the number of days in the Performance Period. Notwithstanding the foregoing, if the Participant’s Date of Termination occurs by reason of the Participant’s death, Retirement or Disability, the Committee may, in its sole discretion, increase the number of Performance Shares to which the Participant is entitled, but in no event will the Participant be entitled to a distribution that is greater than what would have been distributable if no Date of Termination had occurred. The Shares to which the Participant is entitled pursuant to this subparagraph 4(f)(ii) shall be transferred to the Participant in the year following the end of the Performance Period as soon as practical following the Determination Date , but not later than March 15 of the year following the end of the Performance Period. (iii) Subject to the provisions of Section 14.2 of the Plan (relating to the adjustment of Shares), if a Change in Control occurs prior to a Participant's Date of Termination and before the end of the Performance Period and, within two (2) years after the occurrence of the Change in Control, the Participant's Date of Termination occurs by reason of discharge by the Participant's employer without Cause or the Participant resigns from employment with the employer for Good Reason, the Participant shall become vested in all Performance Shares granted under this Agreement prior to the Change in Control that are held by the Participant as of the Date of

5 Termination, in accordance with subparagraphs 4(f)(iv) or 4(f)(v), as applicable. (iv) With respect to any Performance Shares that become vested in connection with a Change in Control described in Subsection 2.7(a), (b), (c) or (d) of the Plan, the number of Shares to which the Participant is entitled upon the vesting of his or her Performance Shares shall be calculated as if the Company had achieved 100% performance against its Performance Goals, and shall be transferred to the Participant as soon as practicable following the Date of Termination. Following a distribution in accordance with this subparagraph 4(f)(iv), the Participant shall have no further rights under this Agreement. (v) With respect to any Performance Shares that become vested in connection with a Change in Control described in Subsection 2.7(e) of the Plan, with respect to a Participant as described therein (relating to certain transactions involving a Subsidiary or Business Segment), as soon as practicable following the Date of Termination, the Participant shall receive a distribution of the following number of Shares, determined on the assumption that the Company achieved 100% performance against its Performance Goals as follows: (A) If the Date of Termination occurs during the first year of the Performance Period, the Participant shall be entitled to receive Shares equal in number to one-third (1/3) of his or her Performance Shares. (B) If the Date of Termination occurs during the second year of the Performance Period, the Participant shall be entitled to receive Shares equal in number to two-thirds (2/3) of his or her Performance Shares. (C) If a Date of Termination occurs during the third year of the Performance Period, such Participant shall be entitled to receive Shares equal in number to the total of all of his or her Performance Shares. Following a distribution in accordance with this subparagraph 4(e)(v), the Participant shall have no further rights under this Agreement. (vi) For purposes of subparagraphs 4(f)(iii) and 4(f)(v) hereof, if, as a result of a Change in Control described in Subsection 2.7(e) of the Plan, the Participant’s employer ceases to be a Subsidiary (and the

6 Participant’s employer is or becomes an entity that is separate from the Company), and the Participant is not, immediately following the Change in Control, employed by the Company or an entity that is then a Subsidiary, then the occurrence of the Change in Control shall be treated as the Participant’s Date of Termination caused by the Participant being discharged by the employer without Cause. (f) Except pursuant to a domestic relations order, the Performance Shares may not be sold, assigned, transferred, pledged or otherwise encumbered until Shares have been distributed to the Participant free and clear of all restrictions. 5. Withholding. The granting, vesting and settlement of Performance Shares under this Agreement are subject to withholding of all applicable taxes. Subject to such rules and limitations as may be established by the Committee from time to time, the Participant may satisfy his or her withholding obligations through (i) payment of cash to the Company equal to the amount of taxes required to be withheld, (ii) contemporaneously withholding from other sources of income otherwise payable to the Participant by the Company or any Subsidiary, or (iii) the surrender of Shares which the Participant already owns, or to which the Participant is otherwise entitled under the Plan or this Agreement; provided, however, that, except as otherwise provided by the Committee, Shares otherwise payable under this Agreement may not be used to satisfy more than the Company's minimum statutory withholding obligation (based on minimum statutory withholding rates for income tax purposes, including payroll taxes, that are applicable to such supplemental taxable income) . In the event that the withholding obligation arises during a period in which the Participant is prohibited from trading in Common Stock pursuant to the Company’s insider trading policy, or by applicable securities or other laws, then unless otherwise elected by the Participant during a period when he or she was not so restricted from trading, the Company shall automatically satisfy the Participant’s withholding obligation by withholding from Shares otherwise deliverable under this Agreement. 6. Heirs and Successors. This Agreement shall be binding upon, and inure to the benefit of, the Company and its successors and assigns, including any person acquiring, whether by merger, consolidation, purchase of assets or otherwise, all or substantially all of the Company's assets and business. If any rights of the Participant or benefits distributable to the Participant under this Agreement have not been exercised or distributed, respectively, at the time of the Participant's death, such rights shall be exercisable by the Designated Beneficiary, and such benefits shall be distributed to the Designated Beneficiary, in accordance with the provisions of this Agreement and the Plan. If a deceased Participant fails to designate a beneficiary, or if the Designated Beneficiary does not survive the Participant, any rights that would have been exercisable by the Participant and any benefits distributable to the Participant shall be exercised by or distributed to the legal representative of the estate of the Participant. If the Designated

7 Beneficiary survives the Participant but dies before the exercise of all rights or the complete distribution of benefits under this Agreement, then any remaining rights and any remaining benefit distribution shall be exercisable by or distributed to the legal representative of the estate of the Designated Beneficiary. 7. Administration. The authority to manage and control the operation and administration of this Agreement shall be vested in the Committee, and the Committee shall have all powers with respect to this Agreement as it has with respect to the Plan. Any interpretation of this Agreement by the Committee and any decision made by it with respect to this Agreement shall be final and binding on all persons. 8. Modification of Performance Goals. Pursuant to Subsection 2.33(b) of the Plan, in determining the extent to which the Performance Goals (but not the Threshold Goal) have been achieved, the Committee may, in its sole discretion, include or exclude items or events that impact the final results, positively or negatively, as it deems appropriate. 9. Plan Governs. Notwithstanding anything in this Agreement to the contrary, the terms of this Agreement shall be subject to the terms of the Plan, a copy of which may be obtained by the Participant from the Director, Compensation of the Company. This Agreement is subject to all interpretations, amendments, rules and regulations promulgated by the Committee from time to time pursuant to the Plan. 10. Not An Employment Contract. The grant of Performance Shares hereunder will not confer on the Participant any right with respect to continuance of employment or other service with the Company or any Subsidiary, nor will it interfere in any way with any right the Company or any Subsidiary would otherwise have to terminate or modify the terms of such Participant's employment or other service at any time. 11. Notices. Any written notices provided for in this Agreement or the Plan shall be provided in accordance with subparagraph 11(a) or 11(b), as applicable and, if provided to the Company, shall be addressed as follows: GATX Corporation 222 West Adams Street Chicago, IL 60606-5314 U.S.A. (a) Any notice required by the Participant pursuant to the definition of Good Reason, as defined below, shall be in writing given by hand delivery or by registered or certified mail, return receipt requested, postage prepaid, addressed to the Senior Vice President, Human Resources and shall be effective when actually received.

8 (b) All other notices shall be in writing and shall be deemed sufficiently given if either hand delivered or if sent by fax or overnight courier, or by postage paid first class mail. Any such notice sent by mail shall be deemed received three business days after mailing, but in no event later than the date of actual receipt and shall be directed, if to the Participant, at the Participant's address indicated by the Company's records, or if to the Company, to the attention of the Director, Compensation. 12. Amendment. This Agreement may be amended in accordance with the provisions of the Plan, and may otherwise be amended by written agreement of the parties. 13. Definitions. For purposes of this Agreement, the terms used in this Agreement shall be subject to the following: “3-Year Average Return on Equity” shall mean the sum of net income divided by average equity for each year in the Performance Period divided by three (3). Accumulated other comprehensive income is excluded from equity. “3-Year Cumulative Investment Volume” shall mean the sum of consolidated cumulative GAAP basis portfolio investments and capital additions as reported on the company’s audited balance sheet for each year in the Performance Period. Purchases of leased in assets are excluded. “Cause” shall mean (i) the willful and continued failure of the Participant to perform the Participant’s duties with the Company or one of its affiliates (other than any such failure resulting from incapacity due to physical or mental illness), or (ii) the willful engaging by the Participant in illegal conduct or gross misconduct in the course of his or her discharge of duties for the Company. For purposes of this provision, no act or failure to act, on the part of the Participant, shall be considered “willful” unless it is done, or omitted to be done, by the Participant in bad faith or without reasonable belief, that the Participant’s action or omission was in the best interests of the Company. “Change in Control” shall have the meaning ascribed to it in Section 2.7 of the Plan. “Date of Termination” shall mean the date on which the Participant incurs a Termination of Service. “Designated Beneficiary” shall mean the beneficiary or beneficiaries designated by the Participant in a writing filed with the Committee in such form and at such time as the Committee shall require.

9 “Disability” shall mean, except as otherwise provided by the Committee, the period in which the Participant is considered to be "disabled" as that term is defined in the Company's long term disability plan. “Good Reason” shall mean the occurrence of one or more of the following conditions without the consent of the Participant: (a) a material diminution in the Participant's base compensation, compared with the Participant's base compensation in effect immediately prior to the consummation of a Change in Control; (b) a material diminution in the Participant's authority, duties, or responsibilities, compared with the authority, duties, and responsibilities of the Participant immediately prior to the consummation of a Change in Control; (c) the Participant is required to report to a supervisor with materially less authority, duties, or responsibilities than the authority, duties, and responsibilities of the supervisor who had the greatest such authority, duties, and responsibilities at the time the Participant was required to report to such supervisor during the 120-day period immediately preceding the consummation of a Change in Control; (d) a material diminution in the budget over which the Participant retains authority, compared with the most significant budget, if any, over which the Participant had authority at any time during the 120-day period immediately preceding the consummation of a Change in Control; (e) a material change in the geographic location at which the Participant must perform services; or (f) any other action or inaction by the Company that constitutes a material breach of any change of control agreement between the Company and the Participant that is in effect when a Change in Control occurs. If (I) the Participant provides written notice to the Company of the occurrence of Good Reason within a reasonable time (not more than 90 days) after the Participant has knowledge of the circumstances constituting Good Reason, which notice specifically identifies the circumstances which the Participant believes constitute Good Reason; (II) the Company fails to notify the Participant of the Company's intended method of correction within a reasonable period of time (not less than 30 days) after the Company receives the notice, or the Company fails to correct the circumstances within a reasonable period of time after such notice (except that no such opportunity to correct shall be applicable if the circumstances constituting Good Reason are those described in paragraph (e) above, relating to relocation); and (III) the Participant resigns within a

10 reasonable time after receiving the Company's response, if such notice does not indicate an intention to correct such circumstances, or within a reasonable time after the Company fails to correct such circumstances (provided that in no event may such termination occur more than two (2) years after the initial existence of the condition constituting Good Reason); then the Participant shall be considered to have terminated for Good Reason. “Performance Goals” shall mean 3-Year Average Return on Equity and 3-Year Cumulative Investment Volume established by the Committee for the Performance Period as set forth in Exhibit 1. “Retirement shall mean retirement of the Participant on a "Retirement Date," as that term is defined in the GATX Corporation Non-Contributory Pension Plan for Salaried Employees.

11 Exhibit 1 Performance Goals, Weights and % of Target Earned 2014 – 2016 Performance Period 3-Year Average ROE (1) (50% weight) % of Target Grant Earned <11.0% 0% 11.0% 25% 11.5% 50% 12.0% 75% 13.0% 100% 13.5% 125% 14.0% 150% 14.5% 175% >= 15.0% 200% Interpolated for actual performance between levels shown (1) 3-Year Average Return on Equity is defined as the sum of net income divided by average equity for each year in the Performance Period divided by three (3); excludes accumulated other comprehensive income from equity. 3-Year Cumulative Investment Volume (2) (50% weight) % of Target Grant Earned <$1.25 billion 0% $1.25 billion 25% $1.55 billion 50% $1.80 billion 75% $2.05 billion 100% $2.20 billion 125% $2.40 billion 150% $2.60 billion 175% >= $2.75 billion 200% Interpolated for actual performance between levels shown (2) 3-Year Cumulative Investment Volume is defined as the sum of consolidated cumulative GAAP basis portfolio investments and capital additions as externally reported for each year in the Performance Period; excludes purchases of leased in assets. In determining the extent to which the Performance Goals (but not the Threshold Goal) have been achieved, the Committee, in its sole discretion, may include or exclude items or events that impact the final results, positively or negatively. However, in no event will the award exceed the Unadjusted Award Amount.

Exhibit 2 12 Sample Calculation of Performance Shares Earned Number of Performance Shares Granted: 1,000 Performance Goal Weight Target Goal Assumed Actual Payout Percentage Weighted Payout Percentage 3-Year Average ROE 3-Year Cumulative Investment Volume 50% 50% 13.0% $2.05 billion 14.0% $1.80 billion 150% 75% 75.0% 37.5% Total Weighted Payout 112.5% Performance Shares Earned Shares Granted Weighted Payout Total Performance Shares Earned 1,000 x 112.5% = 1,125

EX-10.2

AMENDED AND RESTATED AGREEMENT FOR EMPLOYMENT

FOLLOWING A CHANGE OF CONTROL

AGREEMENT by and between GATX Corporation, a New York corporation (the "Company") and Thomas A. Ellman (the "Executive") dated as of the 1st day of January 2014.

The Board of Directors of the Company (the "Board"), has determined that it is in the best interests of the Company and its shareholders to assure that the Company will have the continued dedication of the Executive, notwithstanding the possibility, threat or occurrence of a Change of Control (as defined below). The Board believes it is imperative to diminish the inevitable distraction of the Executive by virtue of the personal uncertainties and risks created by a pending or threatened Change of Control and to encourage the Executive's full attention and dedication to the Company currently and in the event of any threatened or pending Change of Control, and to provide the Executive with compensation and benefits arrangements upon a Change of Control which ensure that the compensation and benefits expectations of the Executive will be satisfied and which are competitive with those of other corporations. Therefore, in order to accomplish these objectives, the Board has caused the Company to enter into this Agreement.

NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

1. Certain Definitions. (a) The "Effective Date" shall mean the first date during the Change of Control Period (as defined in Section 1(b)) on which a Change of Control (as defined in Section 2) occurs. Anything in this Agreement to the contrary notwithstanding, if a Change of Control occurs, and if the Executive's employment with the Company is terminated prior to the date on which the Change of Control occurs, and if it is reasonably demonstrated by the Executive that such termination of employment (i) was at the request of a third party who has taken steps reasonably calculated to effect a Change of Control or (ii) otherwise arose in connection with or anticipation of a Change of Control, then for all purposes of this Agreement the "Effective Date" shall mean the date immediately prior to the date of such termination of employment.

(b) The "Change of Control Period" shall mean the period commencing on January 1, 2014, and ending on the second anniversary of the date thereof; provided, however, that commencing on January 1, 2015, and on each annual anniversary of such date (such date and each annual anniversary thereof shall be hereinafter referred to as the "Renewal Date"), unless previously terminated, the Change of Control Period shall be automatically extended so as to terminate two years from such Renewal Date, unless at least 60 days prior to the Renewal Date the Company shall give notice to the Executive that the Change of Control Period shall not be so extended.

2. Change of Control. For the purpose of this Agreement, a "Change of Control" shall mean:

(a) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) (a "Person") of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (i) the then outstanding shares of common stock of the Company (the "Outstanding Company Common Stock") or (ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the "Outstanding Company Voting Securities"); provided, however, that for purposes of this subsection (a), the following acquisitions shall not constitute a Change of Control: (1) any acquisition directly from the Company, (2) any acquisition by the Company, (3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company or (4) any acquisition by any corporation pursuant to a transaction which complies with clauses (i), (ii) and (iii) of subsection (c) of this Section 2; or

(b) Individuals who, as of the date hereof, constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming

a director subsequent to the date hereof whose election, or nomination for election by the Company's shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or

(c) Consummation of a reorganization, merger or consolidation or sale or other disposition (including, without limitation, a disposition occurring by merger, consolidation, sale, or other similar transactions of one or more subsidiaries of the Company) of all or substantially all of the assets of the Company (a "Business Combination"), in each case unless, following such Business Combination (other than a Business Combination of the type referred to in the first parenthetical of this subsection (c) which results in the disposition of all or substantially all of the assets of the Company), (i) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 65% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company's assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (ii) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 20% or more of, respectively, the then outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then outstanding voting securities of such corporation except to the extent that such ownership existed prior to the Business Combination and (iii) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or

(d) Approval by the shareholders of the Company of a complete liquidation or dissolution of the Company; or

(e) Consummation of a reorganization, merger or consolidation or sale or other disposition of any subsidiary or of all or substantially all of the assets of any subsidiary of the Company or a disposition (in a single transaction or series of integrated transactions) of all or substantially all of the assets of an operating segment of the Company as identified in the financial statements included in the Company’s most recent Annual Report on Form 10-K (each a “Business Segment”) that is, in either case, the primary employer of the Executive or to which the Executive’s responsibilities primarily relate immediately prior thereto, and which does not constitute a Business Combination as defined in Section 2(c), unless immediately thereafter the Company, either directly or indirectly, owns (i) at least 50% of the voting stock of any such subsidiary disposed of or, (ii) in the case of the disposition of all or substantially all of the assets of a subsidiary or Business Segment, at least 50% of both the voting power over and the equity in any entity holding title to such assets.

3. Employment Period. The Company hereby agrees to continue the Executive in its employ, and the Executive hereby agrees to remain in the employ of the Company subject to the terms and conditions of this Agreement, for the period commencing on the Effective Date and ending on the second anniversary of such date (the "Employment Period").

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4. Terms of Employment. (a) Position and Duties. (i) During the Employment Period, (A) the Executive's position (including status, offices, titles and reporting requirements), authority, duties and responsibilities shall be at least commensurate in all material respects with the most significant of those held, exercised and assigned by or to the Executive at any time during the 120-day period immediately preceding the Effective Date and (B) the Executive's services shall be performed at the location where the Executive was employed immediately preceding the Effective Date or any office or location less than 35 miles from such location.

(ii) During the Employment Period, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote reasonable attention and time during normal business hours to the business and affairs of the Company and, to the extent necessary to discharge the responsibilities assigned to the Executive hereunder, to use the Executive's reasonable best efforts to perform faithfully and efficiently such responsibilities. During the Employment Period it shall not be a violation of this Agreement for the Executive to (A) serve on corporate, civic or charitable boards or committees, (B) deliver lectures, fulfill speaking engagements or teach at educational institutions and (C) manage personal investments, so long as such activities do not significantly interfere with the performance of the Executive's responsibilities as an employee of the Company in accordance with this Agreement. It is expressly understood and agreed that to the extent that any such activities have been conducted by the Executive prior to the Effective Date, the continued conduct of such activities (or the conduct of activities similar in nature and scope thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with the performance of the Executive's responsibilities to the Company.

(b) Compensation. (i) Base Salary. During the Employment Period, the Executive shall receive an annual base salary ("Annual Base Salary"), which shall be paid at a monthly rate, at least equal to twelve times the highest monthly base salary paid or payable, including any base salary which has been earned but deferred, to the Executive by the Company and its Affiliates during the twelve-month period immediately preceding the month in which the Effective Date occurs. During the Employment Period, the Annual Base Salary shall be reviewed no more than twelve months after the last salary increase awarded to the Executive prior to the Effective Date and thereafter at least annually. Any increase in Annual Base Salary shall not serve to limit or reduce any other obligation to the Executive under this Agreement. Annual Base Salary shall not be reduced after any such increase and the term Annual Base Salary as utilized in this Agreement shall refer to Annual Base Salary as so increased. As used in this Agreement, the term “Affiliates” means all persons with whom the Company is considered to be a single employer under section 414(b) of the Internal Revenue Code (the “Code”) and all persons with whom the Company would be considered a single employer under section 414(c) of the Code.

(ii) Annual Bonus. In addition to Annual Base Salary, the Executive shall be awarded, for each fiscal year ending during the Employment Period, an annual bonus (the "Annual Bonus") in cash that is not less than the Executive’s target level of bonus for the year in which the Change of Control occurs. Each such Annual Bonus shall be paid no later than the 15^th day of the third month of the fiscal year next following the fiscal year for which the Annual Bonus is awarded.

(iii) Long-Term Incentive, Savings and Retirement Plans. During the Employment Period, the Executive shall be entitled to participate in all long-term incentive, stock compensation, savings and retirement plans, practices, policies and programs applicable generally to other peer executives of the Company and its Affiliates, but in no event shall such plans, practices, policies and programs provide the Executive with long-term incentive opportunities (measured with respect to both regular and special incentive opportunities, to the extent, if any, that such distinction is applicable), stock compensation opportunities, savings opportunities and retirement benefit opportunities, in each case, less favorable, in the aggregate, than the most favorable of those provided by the Company and its Affiliates for the Executive under such plans, practices, policies and programs as in effect at any time during the 120-day period immediately preceding the Effective Date or if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company and its Affiliates.

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(iv) Welfare Benefits. During the Employment Period, the Executive and/or the Executive's family, as the case may be, shall be eligible for participation in and shall receive all benefits under the plans, practices, policies and programs provided by the Company and its Affiliates that provide Welfare Benefits to the extent applicable generally to other peer executives of the Company and its Affiliates, but in no event shall such plans, practices, policies and programs provide the Executive with benefits which are less favorable, in the aggregate, than the most favorable of such plans, practices, policies and programs in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company and its Affiliates. The term “Welfare Benefits” means medical, prescription, dental, disability, employee life, group life, accidental death and travel accident insurance benefits.

(v) Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by the Executive in accordance with the most favorable policies, practices and procedures of the Company and its Affiliates in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and its Affiliates.

(vi) Fringe Benefits. During the Employment Period, the Executive shall be entitled to fringe benefits, including, without limitation, tax and financial planning services, in accordance with the most favorable plans, practices, programs and policies of the Company and its Affiliates in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and its Affiliates.

(vii) Office and Support Staff. During the Employment Period, the Executive shall be entitled to an office or offices of a size and with furnishings and other appointments, and to exclusive personal secretarial and other assistance, at least equal to the most favorable of the foregoing provided to the Executive by the Company and its Affiliates at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as provided generally at any time thereafter with respect to other peer executives of the Company and its Affiliates.

(viii) Vacation. During the Employment Period, the Executive shall be entitled to paid vacation in accordance with the most favorable plans, policies, programs and practices of the Company and its Affiliates as in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and its Affiliates.

5. Termination of Employment. (a) Death or Disability. The Executive's employment shall terminate automatically upon the Executive's death during the Employment Period. If Disability of the Executive has occurred during the Employment Period (pursuant to the definition of Disability set forth below), the Company may give to the Executive written notice in accordance with Section 12(b) of this Agreement of its intention to terminate the Executive's employment no sooner than 30 days following such notice. In such event, the Executive's employment with the Company shall terminate effective on the date specified in such notice (the "Disability Effective Date"), provided that the Executive shall not have returned to full-time performance of the Executive's duties prior thereto. For purposes of this Agreement, "Disability" shall mean any disability that (a) entitles the Executive to disability income benefits under the GATX Long Term Disability Income Plan as in effect on the day prior to the Effective Date, and (b) prevents the Executive, for the duration of the Employment Period, from engaging in the same or comparable type of employment as that in which the Executive was engaged on the day prior to the Effective Date.

(b) Cause. The Company may terminate the Executive's employment during the Employment Period only for Cause. For purposes of this Agreement, "Cause" shall mean:

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(i) the willful and continued failure of the Executive to perform substantially the Executive's duties with the Company or one of its affiliates (other than any such failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to the Executive by the Board or the Chief Executive Officer of the Company which specifically identifies the manner in which the Board or Chief Executive Officer believes that the Executive has not substantially performed the Executive's duties, or

(ii) the willful engaging by the Executive in illegal conduct or gross misconduct which is materially and demonstrably injurious to the Company.

For purposes of this provision, no act or failure to act, on the part of the Executive, shall be considered "willful" unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief that the Executive's action or omission was in the best interests of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or upon the instructions or concurrence of the Chief Executive Officer or a senior officer of the Company or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best interests of the Company. The cessation of employment of the Executive shall not be deemed to be for Cause unless and until there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Executive and the Executive is given an opportunity, together with counsel, to be heard before the Board), finding that, in the good faith opinion of the Board, the Executive is guilty of the conduct described in subparagraph (i) or (ii) above, and specifying the particulars thereof in detail.

(c) Good Reason. The Executive's employment may be terminated during the Employment Period by the Executive for Good Reason. For purposes of this Agreement, "Good Reason" shall mean the occurrence of one or more of the following conditions without the consent of the Executive:

(i) A material diminution in the Executive’s base compensation, compared with the base compensation required to be provided to the Executive in accordance with Section 4(b).

(ii) A material diminution in the Executive’s authority, duties, or responsibilities, compared with the authority, duties, and responsibilities of the Executive provided in Section 4(a).

(iii) The Executive is required to report to a supervisor with materially less authority, duties, or responsibilities than the authority, duties, and responsibilities of the supervisor who had the greatest such authority, duties, and responsibilities at the time the Executive was required to report to such supervisor during the 120-day period immediately preceding the Effective Date.

(iv) A material diminution in the budget over which the Executive retains authority, compared with the most significant budget over which the Executive had authority at any time during the 120-day period immediately preceding the Effective Date.

(v) A material change in the geographic location at which the Executive must perform the services.

(vi) Any other action or inaction by the Company that constitutes a material breach of this Agreement.

If (I) the Executive provides written notice to the Company of the occurrence of Good Reason within a reasonable time (not more than 90 days) after the Executive has knowledge of the circumstances constituting Good Reason, which notice specifically identifies the circumstances which the Executive believes constitute Good Reason; (II) the Company fails to notify the Executive of the Company's intended method of correction within a reasonable period of time (not less than 30 days) after the Company receives the notice, or the

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Company fails to correct the circumstances within a reasonable period of time after such notice (except that no such opportunity to correct shall be applicable if the circumstances constituting Good Reason are those described in paragraph (v) above, relating to relocation); and (III) the Executive resigns within a reasonable time after receiving the Company's response, if such notice does not indicate an intention to correct such circumstances, or within a reasonable time after the Company fails to correct such circumstances (provided that in no event may such termination occur more than two years after the initial existence of the condition constituting Good Reason); then the Executive shall be considered to have terminated for Good Reason.

(d) Notice of Termination. Any termination by the Company for Cause, or by the Executive for Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 12(b) of this Agreement. For purposes of this Agreement, a "Notice of Termination" means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision so indicated and (iii) if the Date of Termination (as defined below) is other than the date of receipt of such notice, specifies the termination date (which date shall be not more than thirty days after the giving of such notice). The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive's or the Company's rights hereunder.

(e) Date of Termination. "Date of Termination" means (i) if the Executive's employment is terminated by the Company for Cause, or by the Executive for Good Reason, the date of receipt of the Notice of Termination or any later date specified therein, as the case may be, (ii) if the Executive's employment is terminated by the Company other than for Cause or Disability, the Date of Termination shall be the date on which the Company notifies the Executive of such termination and (iii) if the Executive's employment is terminated by reason of death or Disability, the Date of Termination shall be the date of death of the Executive or the Disability Effective Date, as the case may be. Notwithstanding the foregoing, references in the Agreement to the Executive's Date of Termination, and the Executive’s termination of employment (including references to the Executive's employment termination, and to the Executive terminating employment) shall mean the Executive ceasing to be employed by the Company and its Affiliates, subject to the following:

(i) The employment relationship will be deemed to have ended at the time the Executive and his employer reasonably anticipate that the level of bona fide services the Executive would perform for the Company and its Affiliates after such date (whether as an employee or independent contractor, but not as a director) would permanently decrease to no more than 20% of the average level of bona fide services performed over the immediately preceding 36 month period (or the full period of service to the Company and its Affiliates if the Executive has performed services for the Company and its Affiliates for less than 36 months). In the absence of an expectation that the Executive will perform at the above-described level, the Date of Termination will not be delayed solely by reason of the Executive continuing to be on the Company's and its Affiliates' payroll after such date.

(ii) The employment relationship will be treated as continuing intact while the Executive is on a bona fide leave of absence (determined in accordance with Treas. Reg. §1.409A-1(h)).

(iii) If, pursuant to Section 11, the Agreement is assumed by a successor, the substitution of the successor for the Company shall not be treated as a termination of employment.

6. Obligations of the Company upon Termination. (a) Good Reason; Other Than for Cause, Death or Disability. If, during the Employment Period, the Company shall terminate the Executive's employment other than for Cause, death or Disability or the Executive shall terminate employment for Good Reason:

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(i)The Company shall pay to the Executive in a lump sum in cash within 30 days after the Date of Termination the aggregate of the following amounts:

A. the sum of (1) the Executive's Annual Base Salary through the Date of Termination to the extent not theretofore paid, (2) the product of (x) the Executive’s Annual Bonus as defined in Section 4(b)(ii) of the Agreement (annualized for any fiscal year consisting of less than twelve full months or during which the Executive was employed for less than twelve full months) and (y) a fraction, the numerator of which is the number of days in the current fiscal year through the Date of Termination, and the denominator of which is 365 and (3) any accrued vacation pay, in each case to the extent not theretofore paid (the sum of the amounts described in clauses (1), (2), and (3) shall be hereinafter referred to as the "Accrued Obligations"); and

B. the amount equal to the product of (1) three and (2) the sum of (x) the Executive's Annual Base Salary and (y) the Executive’s target bonus under the Company’s Management Incentive Plan, or any comparable bonus plan in which the Executive participates and which has a target bonus generally similar to that in the Company’s Management Incentive Plan (the “Target Bonus”), less amounts, if any, paid to the Executive in accordance with the Company’s severance pay policies; and

C. an amount equal to the excess of (a) the actuarial equivalent of the benefit under the Company's qualified defined benefit retirement plan (the "Retirement Plan") and any excess or supplemental retirement plan in which the Executive participates (together, the "SERP") (utilizing in each case actuarial assumptions no less favorable to the Executive than those in effect under the Company's Retirement Plan immediately prior to the Effective Date), which the Executive would receive if the Executive's employment continued for three years after the Date of Termination assuming for this purpose that all accrued benefits are fully vested, and, assuming that the Executive's compensation in each of the three years is equal to the Annual Base Salary as required by Section 4(b)(i) and plus the Executive’s Target Bonus as described in Section 6(i)(B) for the most recent fiscal year (or other bonus amount considered pensionable under the Retirement Plan), over (b) the actuarial equivalent of the Executive's actual benefit (paid or payable), if any, under the Retirement Plan and the SERP as of the Date of Termination;

D. an amount equal to the present value of the benefits to which the Executive is entitled under the SERP as of the Date of Termination, utilizing (a) as a discount rate the rate of return on 10-year Treasury Securities in effect for the month prior to the month in which the Change of Control occurs, and (b) mortality assumptions based on the Applicable Mortality Table defined in Section 417(e)(3)(A)(1) of the Code; such amount shall be paid on the Executive’s Date of Termination; provided, however, that this paragraph (D) shall be without effect if the Executive has elected to receive distribution of benefits under the SERP in a form other than a lump sum upon the Date of Termination.

(ii) for three years after the Executive's Date of Termination, or such longer period as may be provided by the terms of the appropriate plan, program, practice or policy, the Company shall continue to provide the Welfare Benefits to the Executive and/or the Executive's family at least equal to those which would have been provided to them in accordance with the plans, programs, practices and policies providing Welfare Benefits that are described in Section 4(b)(iv) of this Agreement if the Executive's employment had not been terminated or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and its Affiliates and their families, provided, however, that if the Executive becomes reemployed with another employer and is eligible to receive medical or other Welfare Benefits under another employer provided plan, the medical and other Welfare Benefits described herein shall be secondary to those provided under such other plan during such applicable period of eligibility. For purposes of determining eligibility (but not the time of commencement of benefits) of the Executive for retiree benefits pursuant to such plans, practices, programs and policies, the Executive shall be considered to have remained employed

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until three years after the Date of Termination and to have retired on the last day of such period. The Company shall continue to make available to the Executive those health, medical, dental, and prescription drug benefits that are Welfare Benefits at the Executive’s own cost until the Executive is eligible for coverage under Medicare;

(iii) the Company shall, at a maximum cost of 10% of the Executive’s Annual Base Salary, provide the Executive with outplacement services the scope and provider of which shall be selected by the Executive in his sole discretion; provided that in no event shall the services covered by this paragraph (iii) be provided later than the last day of the second calendar year following the calendar year in which the Date of Termination occurred, with the reimbursement for such expenses to be paid no later than the end of the third calendar year following the calendar year in which the Date of Termination occurred; and

(iv) to the extent not otherwise paid or provided pursuant to this Agreement, the Company shall pay or provide to the Executive the Other Benefits that may be due to him in accordance with the terms of the arrangement providing for such amounts or benefits. The term “Other Benefits” shall mean amounts or benefits to the extent that they are required to be provided with respect to the Executive after termination of the Executive’s employment in accordance with the terms of a plan, program, policy, practice, contract, agreement or other arrangement; provided that “Other Benefits” will include only amounts and benefits that would be required to be provided in the absence of this Agreement, except as otherwise expressly provided in paragraphs (b) and (c) below with respect to Other Benefits.

Except as otherwise provided in paragraph (iv), in no event shall the Executive be entitled to receive any benefits under this paragraph (a) (including amounts and rights provided under this paragraph (a)) unless the Executive executes a release of claims against the Company and Affiliates prepared by the Company and such release is not revoked. The Executive shall be eligible for benefits under this paragraph (a) only if the release is returned by such time as is established by the Company; provided that to the extent benefits provided pursuant to this paragraph (a) would constitute Deferred Compensation, such benefits shall be paid or provided to the Executive only if the release is returned in time to permit the distribution of such benefits to satisfy the requirements of section 409A of the Code and further provided that to the extent that benefits are intended to satisfy the short-term deferral exception to treatment as Deferred Compensation (as provided in Treas. Reg. §1.409A-1(b)(4)), such benefits shall be paid to the Executive only if the release is returned in time to permit distribution of benefits no later than the deadline for satisfying the requirements applicable to the short-term deferral exception.

(b) Death. If the Executive's employment is terminated by reason of the Executive's death during the Employment Period, this Agreement shall terminate without further obligations to the Executive's legal representatives under this Agreement, other than for payment of Accrued Obligations and the timely payment or provision of Other Benefits. Accrued Obligations shall be paid to the Executive's estate or beneficiary, as applicable, in a lump sum in cash within 30 days of the Date of Termination. With respect to the provision of Other Benefits, the term Other Benefits as utilized in this Section 6(b) shall include, without limitation, and the Executive's estate and/or beneficiaries shall be entitled to receive, benefits at least equal to the most favorable benefits provided by the Company and Affiliates to the estates and beneficiaries of peer executives of the Company and such Affiliates under such plans, programs, practices and policies relating to death benefits, if any, as in effect with respect to other peer executives and their beneficiaries at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive's estate and/or the Executive's beneficiaries, as in effect on the date of the Executive's death with respect to other peer executives of the Company and its Affiliates and their beneficiaries, with such death benefits to be made at the time and otherwise in accordance with the terms specified by such plan, program, policy, or practice.

(c) Disability. If the Executive's employment is terminated by reason of the Executive's Disability during the Employment Period, this Agreement shall terminate without further obligations to the Executive, other than for payment of Accrued Obligations and the timely payment or provision of Other

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Benefits. Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination. With respect to the provision of Other Benefits, the term Other Benefits as utilized in this Section 6(c) shall include, and the Executive shall be entitled after the Disability Effective Date to receive, disability and other benefits at least equal to the most favorable of those generally provided by the Company and its Affiliates to disabled executives and/or their families in accordance with such plans, programs, practices and policies relating to disability, if any, as in effect generally with respect to other peer executives and their families at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive and/or the Executive's family, as in effect at any time thereafter generally with respect to other peer executives of the Company and its Affiliates and their families.

(d) Cause; Other than for Good Reason. If the Executive's employment shall be terminated for Cause during the Employment Period, this Agreement shall terminate without further obligations to the Executive other than the obligation to pay to the Executive (x) his Annual Base Salary through the Date of Termination, (y) the amount of any compensation previously deferred by the Executive, and (z) Other Benefits, in each case to the extent theretofore unpaid. If the Executive voluntarily terminates employment during the Employment Period, excluding a termination for Good Reason, this Agreement shall terminate without further obligations to the Executive, other than for Accrued Obligations and the timely payment or provision of Other Benefits. In such case, all Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination.

(e) Specified Employee. If the Executive is a Specified Employee at the time of termination of employment:

(i)Payments of cash benefits under this Agreement that constitute Deferred Compensation may not be paid before the date that is six months after the date of termination of employment or, if earlier, the date of death of the Executive. At the end of the six-month period described in the preceding sentence, amounts that could not be paid by reason of the limitation in this paragraph (i) shall be paid on the first day of the seventh month following the date of termination of employment.

(ii)The provision of non-cash benefits (including, without limitation, life insurance, if any, that is not treated as a “death benefit” under Treas. Reg. §1.409A-1) that constitute Deferred Compensation will be provided to the Executive during the period ending six months after the date of termination of employment or, if earlier, the date of death of the Executive only if the Executive pays the cost of such coverage to the Company for that six month period; provided that the Executive shall be reimbursed by the Company for the amount of such payment during the seventh month after termination of employment.

For purposes of this Agreement, the term “Specified Employee” shall be defined in accordance with Treas. Reg. §1.409A-1(i) and such rules as may be established by the Chief Executive Officer of the Company or his or her delegate from time to time. For purposes of this Agreement, the term “Deferred Compensation” means payments or benefits that would be considered to be provided under a nonqualified deferred compensation plan as that term is defined in Treas. Reg. §1.409A-1.

7. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit the Executive's continuing or future participation in any plan, program, policy or practice (other than those providing severance benefits) provided by the Company or any of its Affiliates and for which the Executive may qualify, nor, subject to Section 12(f), shall anything herein limit or otherwise affect such rights as the Executive may have under any contract or agreement with the Company or any of its Affiliates. Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company or any of its Affiliates at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.

8. Full Settlement. (a) The Company's obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off,

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counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Executive or others. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement and such amounts shall not be reduced whether or not the Executive obtains other employment. The Company agrees to pay as incurred, to the full extent permitted by law, all legal fees and expenses which the Executive may incur as a result of any contest (regardless of the outcome thereof) by the Company, the Executive or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Executive about the amount of any payment pursuant to this Agreement), plus in each case interest on any delayed payment at the applicable Federal rate provided for in section 7872(f)(2)(A) of the Code. If, however, following the conclusion of such contest, the court before whom such contest was held determines that under the circumstances it was unjust for the Company to have paid all or any part of the legal fees and expenses of the Executive pursuant to the immediately preceding sentence, the Executive shall repay any such payments to the Company in accordance with the order of the court.

(b) The right of the Executive (including the estate of the Executive) to amounts under this Section 8 shall continue during the life of the Executive (and the life of any beneficiary claiming with respect to the Executive by reason of this Section 8). Payment by the Company under this Section 8 shall be made promptly after the Executive submits reasonable evidence of his having incurred the amounts subject to payment, provided that the Executive shall be required to provide such evidence no later than October 31 of the calendar year following the year in which such expenses are incurred (or such later date permitted by the Company that is not later than the end of the calendar year following the year in which such expenses are incurred), and shall be paid by the Company not later than the last day of the calendar year following the year in which such expenses are incurred. The foregoing provisions of this Section (b) are intended to conform the payments under this Section 8 to the requirements of Code section 409A, and shall not be construed to permit delay by the Company of payment of amounts due earlier in accordance with in this Section 8.

9.Parachute Payments.If any payment or benefit, Executive would receive from the Company or otherwise (“Payment”), would (i) constitute a “parachute payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then such Payment shall be reduced to the Reduced Amount. The “Reduced Amount” shall be either (x) the largest portion of the Payment that would result in no portion of the Payment being subject to the Excise Tax or (y) the largest portion, up to and including the total, of the Payment, whichever amount, after taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate), results in Executive’s receipt, on an after-tax basis, of the greater amount of the Payment notwithstanding that all or some portion of the Payment may be subject to the Excise Tax. If a reduction in payments or benefits constituting “parachute payments” is necessary so that the Payment equals the Reduced Amount, reduction shall occur in the following order: reduction of cash payments; cancellation of accelerated vesting of stock awards; reduction of employee benefits. In the event that acceleration of vesting of stock award compensation is to be reduced, such acceleration of vesting shall be cancelled in the reverse order of the date of grant of Executive’s stock awards. No such reduction shall be made in a manner which violates the requirements of Code section 409A.

10. Post-Termination Protections for Company. (a) Confidentiality. The Executive acknowledges that in the course of the Executive’s involvement in the activities of the Company and its Affiliates, the Executive will have access to confidential and proprietary information including, but not limited to, the Company’s business affairs, financial and strategic plans, customers, vendors, finances, methods of operation, proprietary computer programs, business dealings, assets, capabilities, and all other planning, pricing, customer or client lists of the Company and its Affiliates whether written, oral or otherwise. The Executive agrees that, before, on, and after the Effective Date, the Executive shall keep confidential all information, knowledge or data relating to the Company or any of its Affiliates, and their respective businesses, which shall have been obtained by the Executive during the Executive's employment by the

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Company or any of its Affiliates and which shall have been identified and held by the Company as proprietary and confidential and which shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). During and after termination of the Executive's employment with the Company, the Executive shall not, without the express written consent of the Lead Director of the Company or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data to anyone other than the Company. In no event shall an asserted violation of the provisions of this Section 10 constitute a basis for deferring or withholding any amounts otherwise payable to the Executive under this Agreement.

(b) Competition. The Executive agrees that, while employed by the Company and, if the Executive’s Date of Termination occurs during the Employment Period for any reason, during the twelve month period after the Executive’s Date of Termination, the Executive shall not, without the express written consent of the Lead Director of the Company be employed by, serve as a consultant to, or otherwise assist or directly or indirectly provide services to a Competitor in any location in the United States. The term "Competitor" means any enterprise (including a person, firm, business, division, or other unit, whether or not incorporated) during any period in which it is engaged inthe business of leasing railcar assets. Nothing contained herein will prevent the Executive from engaging in an activity otherwise prohibited by this paragraph (b) for or with respect to any subsidiary, division or affiliate or unit (each, a “Unit”) of an entity if that Unit is not engaged in railcar leasing irrespective of whether another Unit of such entity engages in such competition (as long as the Executive does not engage in prohibited activity for such other Unit).

(c) Solicitation of Customers or Suppliers. The Executive agrees that, while employed by the Company and, if the Executive’s Date of Termination occurs during the Employment Period for any reason, during the twelve month period after the Executive’s Date of Termination, the Executive shall not, without the express written consent of the Lead Director of the Company call on, service or solicit any party who is then or, during the twelve-month period prior to such solicitation by the Executive was a customer or supplier of the Company or Affiliate, provided that the restriction in this paragraph (c) shall not apply to any activity on behalf of a business that is not a Competitor.

(d) Solicitation of Employees. The Executive agrees that, while employed by the Company and, if the Executive’s Date of Termination occurs during the Employment Period for any reason, during the twelve month period after the Executive’s Date of Termination, the Executive shall not, solicit, entice, persuade or induce any individual who is employed by the Company or the Affiliates (or was so employed within 90 days prior to the Executive's action) to terminate or refrain from renewing or extending such employment or to become employed by or enter into contractual relations with any other individual or entity other than the Company or the Affiliates, and the Executive shall not approach any such employee for any such purpose or authorize or knowingly cooperate with the taking of any such actions by any other individual or entity.

(e) Judicial Amendment. It is expressly understood and agreed that although the Executive and the Company consider the restrictions contained in this paragraph 10 to be reasonable, if a final judicial determination is made by a court of competent jurisdiction that the time or territory or any other restriction contained in this Agreement is an unenforceable restriction against the Executive, the provisions of this Agreement shall not be rendered void but shall be deemed amended to apply as to such maximum time and territory and to such maximum extent as such court may judicially determine or indicate to be enforceable. Alternatively, if any court of competent jurisdiction finds that any restriction contained in this Agreement is unenforceable, and such restriction cannot be amended so as to make it enforceable, such finding shall not affect the enforceability of any of the other restrictions contained herein.

(f) Equitable Remedies. The Executive acknowledges that the Company would be irreparably injured by a violation of this paragraph 10, and agrees that the Company, in addition to any other remedies available to it for such breach or threatened breach, shall be entitled to a preliminary injunction, temporary restraining order, or other equivalent relief, restraining the Executive from any actual or threatened breach

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of paragraph 10. If a bond is required to be posted in order for the Company to secure an injunction or other equitable remedy, the parties agree that said bond need not be more than a nominal sum.

(g) Duty of Loyalty. Nothing in this paragraph 10 shall be construed as limiting the Executive's duty of loyalty to the Company, or any other duty the Executive may otherwise have to the Company, while is employed by the Company.

11. Successors. (a) This Agreement is personal to the Executive and without the prior written consent of the Company shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive's legal representatives.

(b) This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns.

(c) The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. The Company agrees that it will not effect the sale or other disposition of all or substantially all of its assets unless either (1) the person or entity acquiring the assets or a substantial portion of the assets shall expressly assume by an instrument in writing all duties and obligations of the Company under this Agreement or (2) the Company shall provide through the establishment of a separate reserve for the payment in full of all amounts that are or may be reasonably expected to become payable to the Executive under this Agreement. As used in this Agreement, "Company" shall mean the Company as herein before defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.

12. Miscellaneous. (a) This Agreement shall be governed by and construed in accordance with the laws of the State of Illinois, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives. No amendment, modification, or termination of this Agreement shall be adopted or effective if it would result in accelerated recognition of income or imposition of additional tax under Code section 409A.

(b) All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to the Executive:

Thomas A. Ellman

26W151 Sandpiper Court

Carol Stream, IL 60188

If to the Company:

GATX Corporation

222 West Adams Street

Chicago, IL 60606-5314

Attention: Executive Vice-President, Human Resources

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or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee.

(c) The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

(d) The Company may withhold from any amounts payable under this Agreement such Federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.

(e) The Executive's or the Company's failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 5(c)(i)‑(vi) of this Agreement, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

(f) The Executive and the Company acknowledge that, except as may otherwise be provided under any other written agreement between the Executive and the Company, the employment of the Executive by the Company is "at will" and, subject to Section 1(a) hereof, prior to the Effective Date, the Executive's employment and/or this Agreement may be terminated by either the Executive or the Company at any time prior to the Effective Date, in which case the Executive shall have no further rights under this Agreement. From and after January 1, 2014, this Agreement shall supersede any other agreement between the parties with respect to the subject matter hereof.

IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand and, pursuant to the authorization from its Board of Directors, the Company has caused these presents to be executed in its name on its behalf, all as of the Execution Date set forth below.

	Executive
	Date
	GATX CORPORATION
By:
	Its Chairman of the Board
	Date

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EX-10.3

AGREEMENT FOR EMPLOYMENT

FOLLOWING A CHANGE OF CONTROL

AGREEMENT by and between GATX Corporation, a New York corporation (the "Company") and Paul F. Titterton (the "Executive") dated as of the 1st day of January 2014.

The Board of Directors of the Company (the "Board"), has determined that it is in the best interests of the Company and its shareholders to assure that the Company will have the continued dedication of the Executive, notwithstanding the possibility, threat or occurrence of a Change of Control (as defined below). The Board believes it is imperative to diminish the inevitable distraction of the Executive by virtue of the personal uncertainties and risks created by a pending or threatened Change of Control and to encourage the Executive's full attention and dedication to the Company currently and in the event of any threatened or pending Change of Control, and to provide the Executive with compensation and benefits arrangements upon a Change of Control which ensure that the compensation and benefits expectations of the Executive will be satisfied and which are competitive with those of other corporations. Therefore, in order to accomplish these objectives, the Board has caused the Company to enter into this Agreement.

NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

1. Certain Definitions. (a) The "Effective Date" shall mean the first date during the Change of Control Period (as defined in Section 1(b)) on which a Change of Control (as defined in Section 2) occurs. Anything in this Agreement to the contrary notwithstanding, if a Change of Control occurs, and if the Executive's employment with the Company is terminated prior to the date on which the Change of Control occurs, and if it is reasonably demonstrated by the Executive that such termination of employment (i) was at the request of a third party who has taken steps reasonably calculated to effect a Change of Control or (ii) otherwise arose in connection with or anticipation of a Change of Control, then for all purposes of this Agreement the "Effective Date" shall mean the date immediately prior to the date of such termination of employment.

(b) The "Change of Control Period" shall mean the period commencing on January 1, 2014, and ending on the second anniversary of the date thereof; provided, however, that commencing on January 1, 2015, and on each annual anniversary of such date (such date and each annual anniversary thereof shall be hereinafter referred to as the "Renewal Date"), unless previously terminated, the Change of Control Period shall be automatically extended so as to terminate two years from such Renewal Date, unless at least 60 days prior to the Renewal Date the Company shall give notice to the Executive that the Change of Control Period shall not be so extended.

2. Change of Control. For the purpose of this Agreement, a "Change of Control" shall mean:

(a) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) (a "Person") of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (i) the then outstanding shares of common stock of the Company (the "Outstanding Company Common Stock") or (ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the "Outstanding Company Voting Securities"); provided, however, that for purposes of this subsection (a), the following acquisitions shall not constitute a Change of Control: (1) any acquisition directly from the Company, (2) any acquisition by the Company, (3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company or (4) any acquisition by any corporation pursuant to a transaction which complies with clauses (i), (ii) and (iii) of subsection (c) of this Section 2; or

(b) Individuals who, as of the date hereof, constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company's shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or

(c) Consummation of a reorganization, merger or consolidation or sale or other disposition (including, without limitation, a disposition occurring by merger, consolidation, sale, or other similar transactions of one or more subsidiaries of the Company) of all or substantially all of the assets of the Company (a "Business Combination"), in each case unless, following such Business Combination (other than a Business Combination of the type referred to in the first parenthetical of this subsection (c) which results in the disposition of all or substantially all of the assets of the Company), (i) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 65% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company's assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (ii) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 20% or more of, respectively, the then outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then outstanding voting securities of such corporation except to the extent that such ownership existed prior to the Business Combination and (iii) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or

(d) Approval by the shareholders of the Company of a complete liquidation or dissolution of the Company; or

(e) Consummation of a reorganization, merger or consolidation or sale or other disposition of any subsidiary or of all or substantially all of the assets of any subsidiary of the Company or a disposition (in a single transaction or series of integrated transactions) of all or substantially all of the assets of an operating segment of the Company as identified in the financial statements included in the Company’s most recent Annual Report on Form 10-K (each a “Business Segment”) that is, in either case, the primary employer of the Executive or to which the Executive’s responsibilities primarily relate immediately prior thereto, and which does not constitute a Business Combination as defined in Section 2(c), unless immediately thereafter the Company, either directly or indirectly, owns (i) at least 50% of the voting stock of any such subsidiary disposed of or, (ii) in the case of the disposition of all or substantially all of the assets of a subsidiary or Business Segment, at least 50% of both the voting power over and the equity in any entity holding title to such assets.

3. Employment Period. The Company hereby agrees to continue the Executive in its employ, and the Executive hereby agrees to remain in the employ of the Company subject to the terms and conditions of this Agreement, for the period commencing on the Effective Date and ending on the second anniversary of such date (the "Employment Period").

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4. Terms of Employment. (a) Position and Duties. (i) During the Employment Period, (A) the Executive's position (including status, offices, titles and reporting requirements), authority, duties and responsibilities shall be at least commensurate in all material respects with the most significant of those held, exercised and assigned by or to the Executive at any time during the 120-day period immediately preceding the Effective Date and (B) the Executive's services shall be performed at the location where the Executive was employed immediately preceding the Effective Date or any office or location less than 35 miles from such location.

(ii) During the Employment Period, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote reasonable attention and time during normal business hours to the business and affairs of the Company and, to the extent necessary to discharge the responsibilities assigned to the Executive hereunder, to use the Executive's reasonable best efforts to perform faithfully and efficiently such responsibilities. During the Employment Period it shall not be a violation of this Agreement for the Executive to (A) serve on corporate, civic or charitable boards or committees, (B) deliver lectures, fulfill speaking engagements or teach at educational institutions and (C) manage personal investments, so long as such activities do not significantly interfere with the performance of the Executive's responsibilities as an employee of the Company in accordance with this Agreement. It is expressly understood and agreed that to the extent that any such activities have been conducted by the Executive prior to the Effective Date, the continued conduct of such activities (or the conduct of activities similar in nature and scope thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with the performance of the Executive's responsibilities to the Company.

(b) Compensation. (i) Base Salary. During the Employment Period, the Executive shall receive an annual base salary ("Annual Base Salary"), which shall be paid at a monthly rate, at least equal to twelve times the highest monthly base salary paid or payable, including any base salary which has been earned but deferred, to the Executive by the Company and its Affiliates during the twelve-month period immediately preceding the month in which the Effective Date occurs. During the Employment Period, the Annual Base Salary shall be reviewed no more than twelve months after the last salary increase awarded to the Executive prior to the Effective Date and thereafter at least annually. Any increase in Annual Base Salary shall not serve to limit or reduce any other obligation to the Executive under this Agreement. Annual Base Salary shall not be reduced after any such increase and the term Annual Base Salary as utilized in this Agreement shall refer to Annual Base Salary as so increased. As used in this Agreement, the term “Affiliates” means all persons with whom the Company is considered to be a single employer under section 414(b) of the Internal Revenue Code (the “Code”) and all persons with whom the Company would be considered a single employer under section 414(c) of the Code.

(ii) Annual Bonus. In addition to Annual Base Salary, the Executive shall be awarded, for each fiscal year ending during the Employment Period, an annual bonus (the "Annual Bonus") in cash that is not less than the Executive’s target level of bonus for the year in which the Change of Control occurs. Each such Annual Bonus shall be paid no later than the 15^th day of the third month of the fiscal year next following the fiscal year for which the Annual Bonus is awarded.

(iii) Long-Term Incentive, Savings and Retirement Plans. During the Employment Period, the Executive shall be entitled to participate in all long-term incentive, stock compensation, savings and retirement plans, practices, policies and programs applicable generally to other peer executives of the Company and its Affiliates, but in no event shall such plans, practices, policies and programs provide the Executive with long-term incentive opportunities (measured with respect to both regular and special incentive opportunities, to the extent, if any, that such distinction is applicable), stock compensation opportunities, savings opportunities and retirement benefit opportunities, in each case, less favorable, in the aggregate, than the most favorable of those provided by the Company and its Affiliates for the Executive under such plans, practices, policies and programs as in effect at any time during the 120-day period immediately preceding the Effective Date or if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company and its Affiliates.

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(iv) Welfare Benefits. During the Employment Period, the Executive and/or the Executive's family, as the case may be, shall be eligible for participation in and shall receive all benefits under the plans, practices, policies and programs provided by the Company and its Affiliates that provide Welfare Benefits to the extent applicable generally to other peer executives of the Company and its Affiliates, but in no event shall such plans, practices, policies and programs provide the Executive with benefits which are less favorable, in the aggregate, than the most favorable of such plans, practices, policies and programs in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company and its Affiliates. The term “Welfare Benefits” means medical, prescription, dental, disability, employee life, group life, accidental death and travel accident insurance benefits.

(v) Expenses. During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by the Executive in accordance with the most favorable policies, practices and procedures of the Company and its Affiliates in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and its Affiliates.

(vi) Vacation. During the Employment Period, the Executive shall be entitled to paid vacation in accordance with the most favorable plans, policies, programs and practices of the Company and its Affiliates as in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and its Affiliates.

5. Termination of Employment. (a) Death or Disability. The Executive's employment shall terminate automatically upon the Executive's death during the Employment Period. If Disability of the Executive has occurred during the Employment Period (pursuant to the definition of Disability set forth below), the Company may give to the Executive written notice in accordance with Section 12(b) of this Agreement of its intention to terminate the Executive's employment no sooner than 30 days following such notice. In such event, the Executive's employment with the Company shall terminate effective on the date specified in such notice (the "Disability Effective Date"), provided that the Executive shall not have returned to full-time performance of the Executive's duties prior thereto. For purposes of this Agreement, "Disability" shall mean any disability that (a) entitles the Executive to disability income benefits under the GATX Long Term Disability Income Plan as in effect on the day prior to the Effective Date, and (b) prevents the Executive, for the duration of the Employment Period, from engaging in the same or comparable type of employment as that in which the Executive was engaged on the day prior to the Effective Date.

(b) Cause. The Company may terminate the Executive's employment during the Employment Period only for Cause. For purposes of this Agreement, "Cause" shall mean:

(i) the willful and continued failure of the Executive to perform substantially the Executive's duties with the Company or one of its affiliates (other than any such failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to the Executive by the Board or the Chief Executive Officer of the Company which specifically identifies the manner in which the Board or Chief Executive Officer believes that the Executive has not substantially performed the Executive's duties, or

(ii) the willful engaging by the Executive in illegal conduct or gross misconduct which is materially and demonstrably injurious to the Company.

For purposes of this provision, no act or failure to act, on the part of the Executive, shall be considered "willful" unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief that the Executive's action or omission was in the best interests of the Company. Any act, or failure to act,

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based upon authority given pursuant to a resolution duly adopted by the Board or upon the instructions or concurrence of the Chief Executive Officer or a senior officer of the Company or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best interests of the Company. The cessation of employment of the Executive shall not be deemed to be for Cause unless and until there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Executive and the Executive is given an opportunity, together with counsel, to be heard before the Board), finding that, in the good faith opinion of the Board, the Executive is guilty of the conduct described in subparagraph (i) or (ii) above, and specifying the particulars thereof in detail.

(c) Good Reason. The Executive's employment may be terminated during the Employment Period by the Executive for Good Reason. For purposes of this Agreement, "Good Reason" shall mean the occurrence of one or more of the following conditions without the consent of the Executive:

(i) A material diminution in the Executive’s base compensation, compared with the base compensation required to be provided to the Executive in accordance with Section 4(b).

(ii) A material diminution in the Executive’s authority, duties, or responsibilities, compared with the authority, duties, and responsibilities of the Executive provided in Section 4(a).

(iii) The Executive is required to report to a supervisor with materially less authority, duties, or responsibilities than the authority, duties, and responsibilities of the supervisor who had the greatest such authority, duties, and responsibilities at the time the Executive was required to report to such supervisor during the 120-day period immediately preceding the Effective Date.

(iv) A material diminution in the budget over which the Executive retains authority, compared with the most significant budget over which the Executive had authority at any time during the 120-day period immediately preceding the Effective Date.

(v) A material change in the geographic location at which the Executive must perform the services.

(vi) Any other action or inaction by the Company that constitutes a material breach of this Agreement.

If (I) the Executive provides written notice to the Company of the occurrence of Good Reason within a reasonable time (not more than 90 days) after the Executive has knowledge of the circumstances constituting Good Reason, which notice specifically identifies the circumstances which the Executive believes constitute Good Reason; (II) the Company fails to notify the Executive of the Company's intended method of correction within a reasonable period of time (not less than 30 days) after the Company receives the notice, or the Company fails to correct the circumstances within a reasonable period of time after such notice (except that no such opportunity to correct shall be applicable if the circumstances constituting Good Reason are those described in paragraph (v) above, relating to relocation); and (III) the Executive resigns within a reasonable time after receiving the Company's response, if such notice does not indicate an intention to correct such circumstances, or within a reasonable time after the Company fails to correct such circumstances (provided that in no event may such termination occur more than two years after the initial existence of the condition constituting Good Reason); then the Executive shall be considered to have terminated for Good Reason.

(d) Notice of Termination. Any termination by the Company for Cause, or by the Executive for Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 12(b) of this Agreement. For purposes of this Agreement, a "Notice of Termination" means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide

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a basis for termination of the Executive's employment under the provision so indicated and (iii) if the Date of Termination (as defined below) is other than the date of receipt of such notice, specifies the termination date (which date shall be not more than thirty days after the giving of such notice). The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive's or the Company's rights hereunder.

(e) Date of Termination. "Date of Termination" means (i) if the Executive's employment is terminated by the Company for Cause, or by the Executive for Good Reason, the date of receipt of the Notice of Termination or any later date specified therein, as the case may be, (ii) if the Executive's employment is terminated by the Company other than for Cause or Disability, the Date of Termination shall be the date on which the Company notifies the Executive of such termination and (iii) if the Executive's employment is terminated by reason of death or Disability, the Date of Termination shall be the date of death of the Executive or the Disability Effective Date, as the case may be. Notwithstanding the foregoing, references in the Agreement to the Executive's Date of Termination, and the Executive’s termination of employment (including references to the Executive's employment termination, and to the Executive terminating employment) shall mean the Executive ceasing to be employed by the Company and its Affiliates, subject to the following:

(i) The employment relationship will be deemed to have ended at the time the Executive and his employer reasonably anticipate that the level of bona fide services the Executive would perform for the Company and its Affiliates after such date (whether as an employee or independent contractor, but not as a director) would permanently decrease to no more than 20% of the average level of bona fide services performed over the immediately preceding 36 month period (or the full period of service to the Company and its Affiliates if the Executive has performed services for the Company and its Affiliates for less than 36 months). In the absence of an expectation that the Executive will perform at the above-described level, the Date of Termination will not be delayed solely by reason of the Executive continuing to be on the Company's and its Affiliates' payroll after such date.

(ii) The employment relationship will be treated as continuing intact while the Executive is on a bona fide leave of absence (determined in accordance with Treas. Reg. §1.409A-1(h)).

(iii) If, pursuant to Section 11, the Agreement is assumed by a successor, the substitution of the successor for the Company shall not be treated as a termination of employment.

6. Obligations of the Company upon Termination. (a) Good Reason; Other Than for Cause, Death or Disability. If, during the Employment Period, the Company shall terminate the Executive's employment other than for Cause, death or Disability or the Executive shall terminate employment for Good Reason:

(i)The Company shall pay to the Executive in a lump sum in cash within 30 days after the Date of Termination the aggregate of the following amounts:

A. the sum of (1) the Executive's Annual Base Salary through the Date of Termination to the extent not theretofore paid, (2) the product of (x) the Executive’s Annual Bonus as defined in Section 4(b)(ii) of the Agreement (annualized for any fiscal year consisting of less than twelve full months or during which the Executive was employed for less than twelve full months) and (y) a fraction, the numerator of which is the number of days in the current fiscal year through the Date of Termination, and the denominator of which is 365 and (3) any accrued vacation pay, in each case to the extent not theretofore paid (the sum of the amounts described in clauses (1), (2), and (3) shall be hereinafter referred to as the "Accrued Obligations"); and

B. the amount equal to the product of (1) two and (2) the sum of (x) the Executive's Annual Base Salary and (y) the Executive’s target bonus under the Company’s Management

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Incentive Plan, or any comparable bonus plan in which the Executive participates and which has a target bonus generally similar to that in the Company’s Management Incentive Plan (the “Target Bonus”), less amounts, if any, paid to the Executive in accordance with the Company’s severance pay policies; and

C. an amount equal to the excess of (a) the actuarial equivalent of the benefit under the Company's qualified defined benefit retirement plan (the "Retirement Plan") and any excess or supplemental retirement plan in which the Executive participates (together, the "SERP") (utilizing in each case actuarial assumptions no less favorable to the Executive than those in effect under the Company's Retirement Plan immediately prior to the Effective Date), which the Executive would receive if the Executive's employment continued for two years after the Date of Termination assuming for this purpose that all accrued benefits are fully vested, and, assuming that the Executive's compensation in each of the two years is equal to the Annual Base Salary as required by Section 4(b)(i) and plus the Executive’s Target Bonus as described in Section 6(i)(B) for the most recent fiscal year (or other bonus amount considered pensionable under the Retirement Plan), over (b) the actuarial equivalent of the Executive's actual benefit (paid or payable), if any, under the Retirement Plan and the SERP as of the Date of Termination;

D. an amount equal to the present value of the benefits to which the Executive is entitled under the SERP as of the Date of Termination, utilizing (a) as a discount rate the rate of return on 10-year Treasury Securities in effect for the month prior to the month in which the Change of Control occurs, and (b) mortality assumptions based on the Applicable Mortality Table defined in Section 417(e)(3)(A)(1) of the Code; such amount shall be paid on the Executive’s Date of Termination; provided, however, that this paragraph (D) shall be without effect if the Executive has elected to receive distribution of benefits under the SERP in a form other than a lump sum upon the Date of Termination.

(ii) for two years after the Executive's Date of Termination, or such longer period as may be provided by the terms of the appropriate plan, program, practice or policy, the Company shall continue to provide the Welfare Benefits to the Executive and/or the Executive's family at least equal to those which would have been provided to them in accordance with the plans, programs, practices and policies providing Welfare Benefits that are described in Section 4(b)(iv) of this Agreement if the Executive's employment had not been terminated or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and its Affiliates and their families, provided, however, that if the Executive becomes reemployed with another employer and is eligible to receive medical or other Welfare Benefits under another employer provided plan, the medical and other Welfare Benefits described herein shall be secondary to those provided under such other plan during such applicable period of eligibility. For purposes of determining eligibility (but not the time of commencement of benefits) of the Executive for retiree benefits pursuant to such plans, practices, programs and policies, the Executive shall be considered to have remained employed until two years after the Date of Termination and to have retired on the last day of such period. The Company shall continue to make available to the Executive those health, medical, dental, and prescription drug benefits that are Welfare Benefits at the Executive’s own cost until the Executive is eligible for coverage under Medicare;

(iii) the Company shall, at a maximum cost of 10% of the Executive’s Annual Base Salary, provide the Executive with outplacement services the scope and provider of which shall be selected by the Executive in his sole discretion; provided that in no event shall the services covered by this paragraph (iii) be provided later than the last day of the second calendar year following the calendar year in which the Date of Termination occurred, with the reimbursement for such expenses to be paid no later than the end of the third calendar year following the calendar year in which the Date of Termination occurred; and

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(iv) to the extent not otherwise paid or provided pursuant to this Agreement, the Company shall pay or provide to the Executive the Other Benefits that may be due to him in accordance with the terms of the arrangement providing for such amounts or benefits. The term “Other Benefits” shall mean amounts or benefits to the extent that they are required to be provided with respect to the Executive after termination of the Executive’s employment in accordance with the terms of a plan, program, policy, practice, contract, agreement or other arrangement; provided that “Other Benefits” will include only amounts and benefits that would be required to be provided in the absence of this Agreement, except as otherwise expressly provided in paragraphs (b) and (c) below with respect to Other Benefits.

Except as otherwise provided in paragraph (iv), in no event shall the Executive be entitled to receive any benefits under this paragraph (a) (including amounts and rights provided under this paragraph (a)) unless the Executive executes a release of claims against the Company and Affiliates prepared by the Company and such release is not revoked. The Executive shall be eligible for benefits under this paragraph (a) only if the release is returned by such time as is established by the Company; provided that to the extent benefits provided pursuant to this paragraph (a) would constitute Deferred Compensation, such benefits shall be paid or provided to the Executive only if the release is returned in time to permit the distribution of such benefits to satisfy the requirements of section 409A of the Code and further provided that to the extent that benefits are intended to satisfy the short-term deferral exception to treatment as Deferred Compensation (as provided in Treas. Reg. §1.409A-1(b)(4)), such benefits shall be paid to the Executive only if the release is returned in time to permit distribution of benefits no later than the deadline for satisfying the requirements applicable to the short-term deferral exception.

(b) Death. If the Executive's employment is terminated by reason of the Executive's death during the Employment Period, this Agreement shall terminate without further obligations to the Executive's legal representatives under this Agreement, other than for payment of Accrued Obligations and the timely payment or provision of Other Benefits. Accrued Obligations shall be paid to the Executive's estate or beneficiary, as applicable, in a lump sum in cash within 30 days of the Date of Termination. With respect to the provision of Other Benefits, the term Other Benefits as utilized in this Section 6(b) shall include, without limitation, and the Executive's estate and/or beneficiaries shall be entitled to receive, benefits at least equal to the most favorable benefits provided by the Company and Affiliates to the estates and beneficiaries of peer executives of the Company and such Affiliates under such plans, programs, practices and policies relating to death benefits, if any, as in effect with respect to other peer executives and their beneficiaries at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive's estate and/or the Executive's beneficiaries, as in effect on the date of the Executive's death with respect to other peer executives of the Company and its Affiliates and their beneficiaries, with such death benefits to be made at the time and otherwise in accordance with the terms specified by such plan, program, policy, or practice.

(c) Disability. If the Executive's employment is terminated by reason of the Executive's Disability during the Employment Period, this Agreement shall terminate without further obligations to the Executive, other than for payment of Accrued Obligations and the timely payment or provision of Other Benefits. Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination. With respect to the provision of Other Benefits, the term Other Benefits as utilized in this Section 6(c) shall include, and the Executive shall be entitled after the Disability Effective Date to receive, disability and other benefits at least equal to the most favorable of those generally provided by the Company and its Affiliates to disabled executives and/or their families in accordance with such plans, programs, practices and policies relating to disability, if any, as in effect generally with respect to other peer executives and their families at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive and/or the Executive's family, as in effect at any time thereafter generally with respect to other peer executives of the Company and its Affiliates and their families.

(d) Cause; Other than for Good Reason. If the Executive's employment shall be terminated for Cause during the Employment Period, this Agreement shall terminate without further obligations to the

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Executive other than the obligation to pay to the Executive (x) his Annual Base Salary through the Date of Termination, (y) the amount of any compensation previously deferred by the Executive, and (z) Other Benefits, in each case to the extent theretofore unpaid. If the Executive voluntarily terminates employment during the Employment Period, excluding a termination for Good Reason, this Agreement shall terminate without further obligations to the Executive, other than for Accrued Obligations and the timely payment or provision of Other Benefits. In such case, all Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination.

(e) Specified Employee. If the Executive is a Specified Employee at the time of termination of employment:

(i)Payments of cash benefits under this Agreement that constitute Deferred Compensation may not be paid before the date that is six months after the date of termination of employment or, if earlier, the date of death of the Executive. At the end of the six-month period described in the preceding sentence, amounts that could not be paid by reason of the limitation in this paragraph (i) shall be paid on the first day of the seventh month following the date of termination of employment.

(ii)The provision of non-cash benefits (including, without limitation, life insurance, if any, that is not treated as a “death benefit” under Treas. Reg. §1.409A-1) that constitute Deferred Compensation will be provided to the Executive during the period ending six months after the date of termination of employment or, if earlier, the date of death of the Executive only if the Executive pays the cost of such coverage to the Company for that six month period; provided that the Executive shall be reimbursed by the Company for the amount of such payment during the seventh month after termination of employment.

For purposes of this Agreement, the term “Specified Employee” shall be defined in accordance with Treas. Reg. §1.409A-1(i) and such rules as may be established by the Chief Executive Officer of the Company or his or her delegate from time to time. For purposes of this Agreement, the term “Deferred Compensation” means payments or benefits that would be considered to be provided under a nonqualified deferred compensation plan as that term is defined in Treas. Reg. §1.409A-1.

7. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit the Executive's continuing or future participation in any plan, program, policy or practice (other than those providing severance benefits) provided by the Company or any of its Affiliates and for which the Executive may qualify, nor, subject to Section 12(f), shall anything herein limit or otherwise affect such rights as the Executive may have under any contract or agreement with the Company or any of its Affiliates. Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company or any of its Affiliates at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.

8. Full Settlement. (a) The Company's obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Executive or others. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement and such amounts shall not be reduced whether or not the Executive obtains other employment. The Company agrees to pay as incurred, to the full extent permitted by law, all legal fees and expenses which the Executive may incur as a result of any contest (regardless of the outcome thereof) by the Company, the Executive or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Executive about the amount of any payment pursuant to this Agreement), plus in each case interest on any delayed payment at the applicable Federal rate provided for in section 7872(f)(2)(A) of the Code. If, however, following the conclusion of such contest, the court before whom such contest was held determines that under the circumstances it was unjust for the Company to have paid all or any part of the legal fees and

9

expenses of the Executive pursuant to the immediately preceding sentence, the Executive shall repay any such payments to the Company in accordance with the order of the court.

(b) The right of the Executive (including the estate of the Executive) to amounts under this Section 8 shall continue during the life of the Executive (and the life of any beneficiary claiming with respect to the Executive by reason of this Section 8). Payment by the Company under this Section 8 shall be made promptly after the Executive submits reasonable evidence of his having incurred the amounts subject to payment, provided that the Executive shall be required to provide such evidence no later than October 31 of the calendar year following the year in which such expenses are incurred (or such later date permitted by the Company that is not later than the end of the calendar year following the year in which such expenses are incurred), and shall be paid by the Company not later than the last day of the calendar year following the year in which such expenses are incurred. The foregoing provisions of this Section (b) are intended to conform the payments under this Section 8 to the requirements of Code section 409A, and shall not be construed to permit delay by the Company of payment of amounts due earlier in accordance with in this Section 8.

9.Parachute Payments.If any payment or benefit, Executive would receive from the Company or otherwise (“Payment”), would (i) constitute a “parachute payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then such Payment shall be reduced to the Reduced Amount. The “Reduced Amount” shall be either (x) the largest portion of the Payment that would result in no portion of the Payment being subject to the Excise Tax or (y) the largest portion, up to and including the total, of the Payment, whichever amount, after taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate), results in Executive’s receipt, on an after-tax basis, of the greater amount of the Payment notwithstanding that all or some portion of the Payment may be subject to the Excise Tax. If a reduction in payments or benefits constituting “parachute payments” is necessary so that the Payment equals the Reduced Amount, reduction shall occur in the following order: reduction of cash payments; cancellation of accelerated vesting of stock awards; reduction of employee benefits. In the event that acceleration of vesting of stock award compensation is to be reduced, such acceleration of vesting shall be cancelled in the reverse order of the date of grant of Executive’s stock awards. No such reduction shall be made in a manner which violates the requirements of Code section 409A.

10. Post-Termination Protections for Company. (a) Confidentiality. The Executive acknowledges that in the course of the Executive’s involvement in the activities of the Company and its Affiliates, the Executive will have access to confidential and proprietary information including, but not limited to, the Company’s business affairs, financial and strategic plans, customers, vendors, finances, methods of operation, proprietary computer programs, business dealings, assets, capabilities, and all other planning, pricing, customer or client lists of the Company and its Affiliates whether written, oral or otherwise. The Executive agrees that, before, on, and after the Effective Date, the Executive shall keep confidential all information, knowledge or data relating to the Company or any of its Affiliates, and their respective businesses, which shall have been obtained by the Executive during the Executive's employment by the Company or any of its Affiliates and which shall have been identified and held by the Company as proprietary and confidential and which shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). During and after termination of the Executive's employment with the Company, the Executive shall not, without the express written consent of the Lead Director of the Company or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data to anyone other than the Company. In no event shall an asserted violation of the provisions of this Section 10 constitute a basis for deferring or withholding any amounts otherwise payable to the Executive under this Agreement.

(b) Competition. The Executive agrees that, while employed by the Company and, if the Executive’s Date of Termination occurs during the Employment Period for any reason, during the twelve month period after the Executive’s Date of Termination, the Executive shall not, without the express written

10

consent of the Lead Director of the Company be employed by, serve as a consultant to, or otherwise assist or directly or indirectly provide services to a Competitor in any location in the United States. The term "Competitor" means any enterprise (including a person, firm, business, division, or other unit, whether or not incorporated) during any period in which it is engaged inthe business of leasing railcar assets. Nothing contained herein will prevent the Executive from engaging in an activity otherwise prohibited by this paragraph (b) for or with respect to any subsidiary, division or affiliate or unit (each, a “Unit”) of an entity if that Unit is not engaged in railcar leasing irrespective of whether another Unit of such entity engages in such competition (as long as the Executive does not engage in prohibited activity for such other Unit).

(c) Solicitation of Customers or Suppliers. The Executive agrees that, while employed by the Company and, if the Executive’s Date of Termination occurs during the Employment Period for any reason, during the twelve month period after the Executive’s Date of Termination, the Executive shall not, without the express written consent of the Lead Director of the Company call on, service or solicit any party who is then or, during the twelve-month period prior to such solicitation by the Executive was a customer or supplier of the Company or Affiliate, provided that the restriction in this paragraph (c) shall not apply to any activity on behalf of a business that is not a Competitor.

(d) Solicitation of Employees. The Executive agrees that, while employed by the Company and, if the Executive’s Date of Termination occurs during the Employment Period for any reason, during the twelve month period after the Executive’s Date of Termination, the Executive shall not, solicit, entice, persuade or induce any individual who is employed by the Company or the Affiliates (or was so employed within 90 days prior to the Executive's action) to terminate or refrain from renewing or extending such employment or to become employed by or enter into contractual relations with any other individual or entity other than the Company or the Affiliates, and the Executive shall not approach any such employee for any such purpose or authorize or knowingly cooperate with the taking of any such actions by any other individual or entity.

(e) Judicial Amendment. It is expressly understood and agreed that although the Executive and the Company consider the restrictions contained in this paragraph 10 to be reasonable, if a final judicial determination is made by a court of competent jurisdiction that the time or territory or any other restriction contained in this Agreement is an unenforceable restriction against the Executive, the provisions of this Agreement shall not be rendered void but shall be deemed amended to apply as to such maximum time and territory and to such maximum extent as such court may judicially determine or indicate to be enforceable. Alternatively, if any court of competent jurisdiction finds that any restriction contained in this Agreement is unenforceable, and such restriction cannot be amended so as to make it enforceable, such finding shall not affect the enforceability of any of the other restrictions contained herein.

(f) Equitable Remedies. The Executive acknowledges that the Company would be irreparably injured by a violation of this paragraph 10, and agrees that the Company, in addition to any other remedies available to it for such breach or threatened breach, shall be entitled to a preliminary injunction, temporary restraining order, or other equivalent relief, restraining the Executive from any actual or threatened breach of paragraph 10. If a bond is required to be posted in order for the Company to secure an injunction or other equitable remedy, the parties agree that said bond need not be more than a nominal sum.

(g) Duty of Loyalty. Nothing in this paragraph 10 shall be construed as limiting the Executive's duty of loyalty to the Company, or any other duty the Executive may otherwise have to the Company, while is employed by the Company.

11. Successors. (a) This Agreement is personal to the Executive and without the prior written consent of the Company shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive's legal representatives.

11

(b) This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns.

(c) The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. The Company agrees that it will not effect the sale or other disposition of all or substantially all of its assets unless either (1) the person or entity acquiring the assets or a substantial portion of the assets shall expressly assume by an instrument in writing all duties and obligations of the Company under this Agreement or (2) the Company shall provide through the establishment of a separate reserve for the payment in full of all amounts that are or may be reasonably expected to become payable to the Executive under this Agreement. As used in this Agreement, "Company" shall mean the Company as herein before defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.

12. Miscellaneous. (a) This Agreement shall be governed by and construed in accordance with the laws of the State of Illinois, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives. No amendment, modification, or termination of this Agreement shall be adopted or effective if it would result in accelerated recognition of income or imposition of additional tax under Code section 409A.

(b) All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to the Executive:

Paul F. Titterton

1700 Forest Avenue

Wilmette, IL 60091

If to the Company:

GATX Corporation

222 West Adams Street

Chicago, IL 60606-5314

Attention: Executive Vice President, Human Resources

or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee.

(c) The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

(d) The Company may withhold from any amounts payable under this Agreement such Federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.

(e) The Executive's or the Company's failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant

12

to Section 5(c)(i)‑(vi) of this Agreement, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

(f) The Executive and the Company acknowledge that, except as may otherwise be provided under any other written agreement between the Executive and the Company, the employment of the Executive by the Company is "at will" and, subject to Section 1(a) hereof, prior to the Effective Date, the Executive's employment and/or this Agreement may be terminated by either the Executive or the Company at any time prior to the Effective Date, in which case the Executive shall have no further rights under this Agreement. From and after the January 1, 2014, this Agreement shall supersede any other agreement between the parties with respect to the subject matter hereof.

IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand and, pursuant to the authorization from its Board of Directors, the Company has caused these presents to be executed in its name on its behalf, all as of the Execution Date set forth below.

	Executive
	Date
	GATX CORPORATION
By:
	Its Chairman of the Board
	Date

13

EX-31.A

Exhibit 31B

Certification of Principal Financial Officer

I, Robert C. Lyons, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of GATX Corporation (the "Company");

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;

4.The Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter (the Company’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and

5.The Company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting.

/s/ Robert C. Lyons

Robert C. Lyons

Executive Vice President and Chief Financial Officer

April 29, 2014

EX-31.B

Exhibit 31A

Certification of Principal Executive Officer

I, Brian A. Kenney, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of GATX Corporation (the "Company");

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;

4.The Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter (the Company’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and

5.The Company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting.

/s/ Brian A. Kenney

Brian A. Kenney

Chairman, President and Chief Executive Officer

April 29, 2014

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of GATX Corporation (the “Company”) on Form 10-Q for the period ending March 31, 2014, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Brian A. Kenney	/s/ Robert C. Lyons
Brian A. Kenney	Robert C. Lyons
Chairman, President and Chief Executive Officer	Executive Vice President and Chief Financial Officer

April 29, 2014

This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by GATX Corporation for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

A signed original of this written statement required by Section 906 has been provided to GATX Corporation and will be retained by GATX Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Commercial Commitments (Details Textual) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Guarantees [Abstract]
Amount of liability included in recorded value of the company's commitment	$ 6.0	$ 6.2
Expiration of commitment range	2014 to 2023

XML

Fair Value Disclosure (Details Textual) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Derivative [Line Items]
Property, Plant and Equipment, Net	$ 5,599.8		$ 5,070.3
Asset Impairment Charges	(0.3)	(0.9)
Fair Value Disclosure (Textual) [Abstract]
Derivative Asset, Notional Amount	500.0		200.0
Derivative, Notional Amount	163.5		163.6
Cash Flow Hedge Pre Tax Gain Loss to be Reclassified within Twelve Months	(9.5)
Expected After tax reclassification of net losses from accumulated other comprehensive income to earnings in Next Twelve Months	6.0
Aggregate fair value of all derivative instruments with Net liability position	$ 4.2
Document Period End Date	Mar. 31, 2014
Fair Value Hedging [Member]
Fair Value Disclosure (Textual) [Abstract]
Number of instruments, outstanding	6		3
Maturity Date Range of Derivative Instruments	2015 to 2019
Cash Flow Hedges [Member]
Fair Value Disclosure (Textual) [Abstract]
Number of instruments, outstanding	6		6
Maturity Date Range of Derivative Instruments	2014 to 2020

XML

Financial Data of Business Segments (Tables)

3 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Segment data

The following tables show certain segment data of each of our business segments (in millions):

	Rail North America			Rail International			ASC			Portfolio Management			Other			GATX Consolidated
Three Months Ended March 31, 2014
Profitability
Revenues
Lease revenue	$	194.9		$	47.2		$	1.1		$	7.4		$	—		$	250.6
Marine operating revenue	—			—			3.1			14.6			—			17.7
Other revenue	14.6			2.0			—			1.7			—			18.3
Total Revenues	209.5			49.2			4.2			23.7			—			286.6
Expenses
Maintenance expense	61.4			11.5			0.2			—			—			73.1
Marine operating expense	—			—			3.4			11.6			—			15.0
Depreciation expense	41.5			11.7			—			5.5			—			58.7
Operating lease expense	26.9			—			—			—			—			26.9
Other operating expense	4.8			1.4			—			0.4			—			6.6
Total Expenses	134.6			24.6			3.6			17.5			—			180.3
Other Income (Expense)
Net gain (loss) on asset dispositions	24.8			2.4			(0.4		)	1.3			—			28.1
Interest expense, net	(24.6		)	(6.2		)	(1.4		)	(6.8		)	(3.0		)	(42.0		)
Other (expense) income	(3.4		)	—			—			0.3			(0.3		)	(3.4		)
Share of affiliates' earnings (pretax)	3.3			(0.1		)	—			10.9			—			14.1
Segment Profit (Loss)	$	75.0		$	20.7		$	(1.2	)	$	11.9		$	(3.3	)	103.1
Selling, general and administrative expense																42.7
Income taxes (including $4.2 related to affiliates' earnings)																18.3
Net Income																$	42.1
Net Gain on Asset Dispositions
Asset Remarketing Income:
Disposition gains on owned assets	$	21.6		$	—		$	—		$	—		$	—		$	21.6
Residual sharing income	0.6			—			—			1.2			—			1.8
Non-remarketing disposition gains (1)	2.6			2.4			—			—			—			5.0
Asset impairment	—			—			(0.4		)	0.1			—			(0.3		)
	$	24.8		$	2.4		$	(0.4	)	$	1.3		$	—		$	28.1
Capital Expenditures
Portfolio investments and capital additions	$	396.0		$	39.3		$	8.3		$	—		$	1.9		$	445.5
Selected Balance Sheet Data at March 31, 2014
Investments in affiliated companies	$	21.9		$	1.9		$	—		$	324.7		$	—		$	348.5
Identifiable assets	$	4,186.8		$	1,327.1		$	267.1		$	854.6		$	483.4		$	7,119.0

_____

(1) Includes scrapping gains.

	Rail North America			Rail International			ASC			Portfolio Management			Other			GATX Consolidated
Three Months Ended March 31, 2013
Profitability
Revenues
Lease revenue	$	183.8		$	43.0		$	1.1		$	9.3		$	—		$	237.2
Marine operating revenue	—			—			12.3			6.2			—			18.5
Other revenue	13.8			2.2			—			0.6			—			16.6
Total Revenues	197.6			45.2			13.4			16.1			—			272.3
Expenses
Maintenance expense	54.6			11.5			0.6			—			—			66.7
Marine operating expense	—			—			9.8			6.8			—			16.6
Depreciation expense	42.3			10.1			—			5.5			—			57.9
Operating lease expense	32.3			—			—			—			—			32.3
Other operating expense	4.0			0.9			—			0.4			—			5.3
Total Expenses	133.2			22.5			10.4			12.7			—			178.8
Other Income (Expense)
Net gain on asset dispositions	10.2			1.2			—			5.3			—			16.7
Interest expense, net	(25.7		)	(5.6		)	(1.6		)	(6.7		)	(1.3		)	(40.9		)
Other (expense) income	(0.8		)	0.5			(0.6		)	—			(0.2		)	(1.1		)
Share of affiliates' earnings (pretax)	2.2			(0.2		)	—			10.5			—			12.5
Segment Profit (Loss)	$	50.3		$	18.6		$	0.8		$	12.5		$	(1.5	)	80.7
Selling, general and administrative expense																42.0
Income taxes (including $4.1 related to affiliates' earnings)																11.6
Net Income																$	27.1
Net Gain on Asset Dispositions
Asset Remarketing Income:
Disposition gains on owned assets	$	1.6		$	—		$	—		$	4.2		$	—		$	5.8
Residual sharing income	2.8			—			—			1.1			—			3.9
Non-remarketing disposition gains (1)	6.5			1.4			—			—			—			7.9
Asset impairment	(0.7		)	(0.2		)	—			—			—			(0.9		)
	$	10.2		$	1.2		$	—		$	5.3		$	—		$	16.7
Capital Expenditures
Portfolio investments and capital additions	$	85.7		$	44.3		$	3.2		$	16.0		$	0.7		$	149.9
Selected Balance Sheet Data at December 31, 2013
Investments in affiliated companies	$	31.4		$	2.0		$	—		$	320.9		$	—		$	354.3
Identifiable assets	$	3,710.5		$	1,297.1		$	271.0		$	856.9		$	414.1		$	6,549.6

XML

Legal Proceedings and Other Contingencies (Details) (Viareggio [Member], USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014 case	Oct. 02, 2013 Insurance_Provider	Dec. 14, 2012 Corporations Employee	Jun. 29, 2009
Loss Contingencies [Line Items]
Number of casualties				32
Number of subsidiaries			2
Number of Maintenance and Supervisory employees			10.0
Number of Italian railway companies			4
Number of employees			18
Number of insurers		4
Asbestos - related cases pending against the company and its subsidiaries	90
Court Proceedings	1
Legal Fees	$ 0
Percentage of coverage held by Liberty Mutual Insurance Europe Limited		25.00%
Derailed [Member]
Loss Contingencies [Line Items]
number of railcars				14
Overturned [Member]
Loss Contingencies [Line Items]
number of railcars				5
Punctured and Ignited [Member]
Loss Contingencies [Line Items]
number of railcars				1

XML

Income Taxes (Details Textual) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Income Tax Disclosure [Abstract]
Unrecognized Tax Benefits	$ 5.3
Decrease in income tax expenses unrecognized tax benefits if recognized	5.3
Decrease in Income Tax Expenses Unrecognized Tax Benefits if Recognized Net of Federal Tax	3.4
Reductions due to expiration of the applicable statute of limitations	$ 0.4
Effective Income Tax Rate Reconciliation, Percent	30.00%	29.00%
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent	35.00%	35.00%

XML

Fair Value Disclosure

3 Months Ended

Mar. 31, 2014

Fair Value Disclosures [Abstract]

Fair Value Disclosure

Fair Value Disclosure

The following tables show our assets and liabilities that are measured at fair value on a recurring basis (in millions):

Assets	March 31, 2014		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs    (Level 3)
Interest rate derivatives (1)	$	4.8	$	—	$	4.8	$	—
Available-for-sale equity securities	4.2		4.2		—		—
Liabilities
Interest rate derivatives (1)	3.1		—		3.1		—
Interest rate derivatives (2)	0.2		—		0.2		—
Foreign exchange rate derivatives (2)	2.6		—		2.6		—

Assets	December 31, 2013		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Interest rate derivatives (1)	$	6.0	$	—	$	6.0	$	—
Available-for-sale equity securities	4.7		4.7		—		—
Liabilities
Interest rate derivatives (1)	0.8		—		0.8		—
Interest rate derivatives (2)	0.2		—		0.2		—
Foreign exchange rate derivatives (2)	2.6		—		2.6		—

_________

(1) Designated as hedges.

(2) Not designated as hedges.

We base our valuations of available-for-sale equity securities on their quoted prices on an active exchange. We value derivatives using a pricing model with inputs (such as yield curves and credit spreads) that are observable in the market or that can be derived principally from observable market data.

Derivative instruments

Fair Value Hedges

We use interest rate swaps to manage the fixed-to-floating rate mix of our debt obligations by converting the fixed rate debt to floating rate debt. For fair value hedges, we recognize changes in fair value of both the derivative and the hedged item as interest expense. We had six instruments outstanding with an aggregate notional amount of $500.0 million as of March 31, 2014, and three instruments outstanding with an aggregate notional amount of $200.0 million as of December 31, 2013. These derivatives have maturities ranging from 2015 to 2019.

Cash Flow Hedges

We use interest rate swaps to convert floating rate debt to fixed rate debt. We also use Treasury rate locks to hedge our exposure to interest rate risk on anticipated transactions. We had six instruments outstanding with an aggregate notional amount of $163.5 million as of March 31, 2014, and six instruments outstanding with an aggregate notional amount of $163.6 million as of December 31, 2013. These derivatives had maturities ranging from 2014 to 2020. Within the next 12 months, we expect to reclassify $9.5 million ($6.0 million after-tax) of net losses on previously terminated derivatives from accumulated other comprehensive loss. We reclassify these amounts when interest and operating lease expense on the related hedged transactions affect earnings.

Non-designated Derivatives

We do not hold derivative financial instruments for purposes other than hedging, although certain of our derivatives are not designated as accounting hedges. We recognize changes in the fair value of these derivatives in other (income) expense immediately.

Some of our derivative instruments contain credit risk provisions that could require us to make immediate payment on net liability positions in the event that we default on certain outstanding debt obligations. The aggregate fair value of our derivative instruments with credit risk related contingent features that are in a liability position as of March 31, 2014, was $4.2 million. We are not required to post any collateral on our derivative instruments and do not expect the credit risk provisions to be triggered.

In the event that a counterparty fails to meet the terms of an interest rate swap agreement or a foreign exchange contract, our exposure is limited to the fair value of the swap, if in our favor. We manage the credit risk of counterparties by transacting with institutions that we consider financially sound and by avoiding concentrations of risk with a single counterparty. We believe that the risk of non-performance by any of our counterparties is remote.

The following table shows the impacts of our derivative instruments on our statement of comprehensive loss (in millions):

		Three Months Ended March 31
Derivative Designation	Location of Loss (Gain) Recognized	2014		2013
Fair value hedges (1)	Interest expense	$	2.1	$	1.1
Cash flow hedges	Other comprehensive loss (gain) (effective portion)	1.8		(0.3		)
Cash flow hedges	Interest expense (effective portion reclassified from accumulated other comprehensive loss)	1.2		1.2
Cash flow hedges	Operating lease expense (effective portion reclassified from accumulated other comprehensive loss)	2.4		0.4
Non-designated	Other expense	0.1		0.5

_________

(1) The fair value adjustments related to the underlying debt equally offset the amounts recognized in interest expense.

Other Financial Instruments

The carrying amounts of cash and cash equivalents, restricted cash, rent and other receivables, accounts payable, and commercial paper and bank credit facilities approximate fair value due to the short maturity of those instruments. We base the fair values of investment funds, which are accounted for under the cost method, on the best information available, which may include quoted investment fund values. We estimate the fair values of loans and fixed and floating rate debt using discounted cash flow analyses based on interest rates currently offered for loans with similar terms to borrowers of similar credit quality. The inputs we use to estimate each of these values are classified in Level 2 of the fair value hierarchy because they are directly or indirectly observable inputs.

The following table shows the carrying amounts and fair values of our other financial instruments as of (in millions):

	March 31, 2014				December 31, 2013
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Assets
Investment funds	$	1.7	$	3.8	$	1.7	$	4.0
Loans	121.4		120.2		122.7		121.5
Liabilities
Recourse fixed rate debt	$	3,718.8	$	3,851.6	$	2,871.2	$	2,994.0
Recourse floating rate debt	591.2		595.4		894.7		906.2
Nonrecourse debt	70.1		71.6		72.6		74.7

The following table shows the carrying amounts and fair values of our other financial instruments as of (in millions):

	March 31, 2014				December 31, 2013
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Assets
Investment funds	$	1.7	$	3.8	$	1.7	$	4.0
Loans	121.4		120.2		122.7		121.5
Liabilities
Recourse fixed rate debt	$	3,718.8	$	3,851.6	$	2,871.2	$	2,994.0
Recourse floating rate debt	591.2		595.4		894.7		906.2
Nonrecourse debt	70.1		71.6		72.6		74.7

Derivative instruments

Fair Value Hedges

We use interest rate swaps to manage the fixed-to-floating rate mix of our debt obligations by converting the fixed rate debt to floating rate debt. For fair value hedges, we recognize changes in fair value of both the derivative and the hedged item as interest expense. We had six instruments outstanding with an aggregate notional amount of $500.0 million as of March 31, 2014, and three instruments outstanding with an aggregate notional amount of $200.0 million as of December 31, 2013. These derivatives have maturities ranging from 2015 to 2019.

Cash Flow Hedges

We use interest rate swaps to convert floating rate debt to fixed rate debt. We also use Treasury rate locks to hedge our exposure to interest rate risk on anticipated transactions. We had six instruments outstanding with an aggregate notional amount of $163.5 million as of March 31, 2014, and six instruments outstanding with an aggregate notional amount of $163.6 million as of December 31, 2013. These derivatives had maturities ranging from 2014 to 2020. Within the next 12 months, we expect to reclassify $9.5 million ($6.0 million after-tax) of net losses on previously terminated derivatives from accumulated other comprehensive loss. We reclassify these amounts when interest and operating lease expense on the related hedged transactions affect earnings.

Non-designated Derivatives

We do not hold derivative financial instruments for purposes other than hedging, although certain of our derivatives are not designated as accounting hedges. We recognize changes in the fair value of these derivatives in other (income) expense immediately.

Some of our derivative instruments contain credit risk provisions that could require us to make immediate payment on net liability positions in the event that we default on certain outstanding debt obligations. The aggregate fair value of our derivative instruments with credit risk related contingent features that are in a liability position as of March 31, 2014, was $4.2 million. We are not required to post any collateral on our derivative instruments and do not expect the credit risk provisions to be triggered.

In the event that a counterparty fails to meet the terms of an interest rate swap agreement or a foreign exchange contract, our exposure is limited to the fair value of the swap, if in our favor. We manage the credit risk of counterparties by transacting with institutions that we consider financially sound and by avoiding concentrations of risk with a single counterparty. We believe that the risk of non-performance by any of our counterparties is remote.

The following table shows the impacts of our derivative instruments on our statement of comprehensive loss (in millions):

		Three Months Ended March 31
Derivative Designation	Location of Loss (Gain) Recognized	2014		2013
Fair value hedges (1)	Interest expense	$	2.1	$	1.1
Cash flow hedges	Other comprehensive loss (gain) (effective portion)	1.8		(0.3		)
Cash flow hedges	Interest expense (effective portion reclassified from accumulated other comprehensive loss)	1.2		1.2
Cash flow hedges	Operating lease expense (effective portion reclassified from accumulated other comprehensive loss)	2.4		0.4
Non-designated	Other expense	0.1		0.5

_________

(1) The fair value adjustments related to the underlying debt equally offset the amounts recognized in interest expense.

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Financial Data of Business Segments (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014 Segment	Mar. 31, 2013	Dec. 31, 2013
Segment Reporting Information [Line Items]
Provision for Income Taxes, Equity Method Investment	$ 4.2	$ 4.1
Number of business segments	4
Profitability
Lease revenue	250.6	237.2
Marine operating revenue	17.7	18.5
Other revenue	18.3	16.6
Total Revenues	286.6	272.3
Maintenance expense	73.1	66.7
Marine operating expense	15.0	16.6
Depreciation	58.7	57.9
Operating lease expense	26.9	32.3
Other operating expense	6.6	5.3
Total Expenses	180.3	178.8
Net gain on asset dispositions	28.1	16.7
Interest expense, net	(42.0)	(40.9)
Other (expense) income	(3.4)	(1.1)
Share of affiliates' earnings (pre-tax)	14.1	12.5
Segment profit (loss)	103.1	80.7
SG&A	42.7	42.0
Income tax benefit	14.1	7.5
Net Income	42.1	27.1
Capital Expenditures
Portfolio investments and capital additions	445.5	149.9
Selected Balance Sheet Data
Investments in affiliated companies	348.5	354.3	354.3
Identifiable assets	7,119.0	6,549.6	6,549.6
Disposition Gains on Owned Assets	21.6	5.8
Nonoperating Income, Residual Sharing Income	1.8	3.9
Nonremarketing Disposition Gain (Loss)	5.0	7.9
Asset Impairment Charges	(0.3)	(0.9)
Rail North America [Member]
Segment Reporting Information [Line Items]
Leverage level expressed as a ratio of recourse debt to equity	5
Profitability
Lease revenue	194.9	183.8
Marine operating revenue	0	0
Other revenue	14.6	13.8
Total Revenues	209.5	197.6
Maintenance expense	61.4	54.6
Marine operating expense	0	0
Depreciation	41.5	42.3
Operating lease expense	26.9	32.3
Other operating expense	4.8	4.0
Total Expenses	134.6	133.2
Net gain on asset dispositions	24.8	10.2
Interest expense, net	(24.6)	(25.7)
Other (expense) income	(3.4)	(0.8)
Share of affiliates' earnings (pre-tax)	3.3	2.2
Segment profit (loss)	75.0	50.3
Capital Expenditures
Portfolio investments and capital additions	(396.0)	85.7
Selected Balance Sheet Data
Investments in affiliated companies	21.9	31.4
Identifiable assets	4,186.8	3,710.5
Disposition Gains on Owned Assets	21.6	1.6
Nonoperating Income, Residual Sharing Income	0.6	2.8
Nonremarketing Disposition Gain (Loss)	2.6	6.5
Asset Impairment Charges	0	(0.7)
Rail International [Member]
Segment Reporting Information [Line Items]
Leverage level expressed as a ratio of recourse debt to equity	2
Profitability
Lease revenue	47.2	43.0
Marine operating revenue	0	0
Other revenue	2.0	2.2
Total Revenues	49.2	45.2
Maintenance expense	11.5	11.5
Marine operating expense	0	0
Depreciation	11.7	10.1
Operating lease expense	0	0
Other operating expense	1.4	0.9
Total Expenses	24.6	22.5
Net gain on asset dispositions	2.4	1.2
Interest expense, net	(6.2)	(5.6)
Other (expense) income	0	0.5
Share of affiliates' earnings (pre-tax)	(0.1)	(0.2)
Segment profit (loss)	20.7	18.6
Capital Expenditures
Portfolio investments and capital additions	(39.3)	44.3
Selected Balance Sheet Data
Investments in affiliated companies	1.9	2.0
Identifiable assets	1,327.1	1,297.1
Disposition Gains on Owned Assets	0	0
Nonoperating Income, Residual Sharing Income	0	0
Nonremarketing Disposition Gain (Loss)	2.4	1.4
Asset Impairment Charges	0	(0.2)
ASC [Member]
Segment Reporting Information [Line Items]
Leverage level expressed as a ratio of recourse debt to equity	1.5
Profitability
Lease revenue	1.1	1.1
Marine operating revenue	3.1	12.3
Other revenue	0	0
Total Revenues	4.2	13.4
Maintenance expense	0.2	0.6
Marine operating expense	3.4	9.8
Depreciation	0	0
Operating lease expense	0	0
Other operating expense	0	0
Total Expenses	3.6	10.4
Net gain on asset dispositions	(0.4)	0
Interest expense, net	(1.4)	(1.6)
Other (expense) income	0	(0.6)
Share of affiliates' earnings (pre-tax)	0	0
Segment profit (loss)	(1.2)	0.8
Capital Expenditures
Portfolio investments and capital additions	(8.3)	3.2
Selected Balance Sheet Data
Investments in affiliated companies	0	0
Identifiable assets	267.1	271.0
Disposition Gains on Owned Assets	0	0
Nonoperating Income, Residual Sharing Income	0	0
Nonremarketing Disposition Gain (Loss)	0	0
Asset Impairment Charges	(0.4)	0
Portfolio Management [Member]
Segment Reporting Information [Line Items]
Leverage level expressed as a ratio of recourse debt to equity	3
Profitability
Lease revenue	7.4	9.3
Marine operating revenue	14.6	6.2
Other revenue	1.7	0.6
Total Revenues	23.7	16.1
Maintenance expense	0	0
Marine operating expense	11.6	6.8
Depreciation	5.5	5.5
Operating lease expense	0	0
Other operating expense	0.4	0.4
Total Expenses	17.5	12.7
Net gain on asset dispositions	1.3	5.3
Interest expense, net	(6.8)	(6.7)
Other (expense) income	0.3	0
Share of affiliates' earnings (pre-tax)	10.9	10.5
Segment profit (loss)	11.9	12.5
Capital Expenditures
Portfolio investments and capital additions	0	16.0
Selected Balance Sheet Data
Investments in affiliated companies	324.7	320.9
Identifiable assets	854.6	856.9
Disposition Gains on Owned Assets	0	4.2
Nonoperating Income, Residual Sharing Income	1.2	1.1
Nonremarketing Disposition Gain (Loss)	0	0
Asset Impairment Charges	0.1	0
Other [Member]
Profitability
Lease revenue	0	0
Marine operating revenue	0	0
Other revenue	0	0
Total Revenues	0	0
Maintenance expense	0	0
Marine operating expense	0	0
Depreciation	0	0
Operating lease expense	0	0
Other operating expense	0	0
Total Expenses	0	0
Net gain on asset dispositions	0	0
Interest expense, net	(3.0)	(1.3)
Other (expense) income	(0.3)	(0.2)
Share of affiliates' earnings (pre-tax)	0	0
Segment profit (loss)	(3.3)	(1.5)
Capital Expenditures
Portfolio investments and capital additions	(1.9)	0.7
Selected Balance Sheet Data
Investments in affiliated companies	0	0
Identifiable assets	483.4	414.1
Disposition Gains on Owned Assets	0	0
Nonoperating Income, Residual Sharing Income	0	0
Nonremarketing Disposition Gain (Loss)	0	0
Asset Impairment Charges	0	0
Parent [Member]
Profitability
Income tax benefit	$ 18.3	$ 11.6

XML

Variable Interest Entities (Details 1) (USD $) In Millions, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Carrying amounts and maximum exposure to loss with respect to VIEs
Net Carrying Amount	$ 130.0	$ 126.1
Maximum Exposure to Loss	130.0	126.1
Investments in Affiliates [Member]
Carrying amounts and maximum exposure to loss with respect to VIEs
Net Carrying Amount	129.4	125.5
Maximum Exposure to Loss	129.4	125.5
Other investment [Member]
Carrying amounts and maximum exposure to loss with respect to VIEs
Net Carrying Amount	0.6	0.6
Maximum Exposure to Loss	$ 0.6	$ 0.6

XML

Variable Interest Entities (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2014 Variable Interest, Held by Entity [Member]		Dec. 31, 2013 Variable Interest, Held by Entity [Member]
Variable Interest Entity [Line Items]
Variable Interest Entity, Qualitative or Quantitative Information, Type of Entity	one
Carrying amounts of assets and liabilities of the VIE
Operating assets, net of accumulated depreciation		$ 91.8	[1]	$ 93.0	[1]
Nonrecourse debt		$ 23.0		$ 25.4

[1] (1) All operating assets are pledged as collateral on the nonrecourse debt.

XML

Fair Value Disclosure (Details) (Fair Value, Measurements, Recurring [Member], USD $) In Millions, unless otherwise specified	Mar. 31, 2014		Dec. 31, 2013
Assets
Available for sale equity securities	$ 4.2		$ 4.7
Designated as Hedging Instrument [Member]
Assets
Interest rate derivatives	4.8	[1]	6.0	[1]
Liabilities
Interest rate derivatives	3.1	[1]	0.8	[1]
Not Designated as Hedging Instrument [Member]
Liabilities
Interest rate derivatives	0.2	[2]	0.2	[2]
Foreign exchange rate derivatives	2.6	[2]	2.6	[2]
Fair Value, Inputs, Level 1 [Member]
Assets
Available for sale equity securities	4.2		4.7
Fair Value, Inputs, Level 1 [Member] | Designated as Hedging Instrument [Member]
Assets
Interest rate derivatives	0	[1]	0	[1]
Liabilities
Interest rate derivatives	0	[1]	0	[1]
Fair Value, Inputs, Level 1 [Member] | Not Designated as Hedging Instrument [Member]
Liabilities
Interest rate derivatives	0	[2]	0	[2]
Foreign exchange rate derivatives	0	[2]	0	[2]
Fair Value, Inputs, Level 2 [Member]
Assets
Available for sale equity securities	0		0
Fair Value, Inputs, Level 2 [Member] | Designated as Hedging Instrument [Member]
Assets
Interest rate derivatives	4.8	[1]	6.0	[1]
Liabilities
Interest rate derivatives	3.1	[1]	0.8	[1]
Fair Value, Inputs, Level 2 [Member] | Not Designated as Hedging Instrument [Member]
Liabilities
Interest rate derivatives	0.2	[2]	0.2	[2]
Foreign exchange rate derivatives	2.6	[2]	2.6	[2]
Fair Value, Inputs, Level 3 [Member]
Assets
Available for sale equity securities	0		0
Fair Value, Inputs, Level 3 [Member] | Designated as Hedging Instrument [Member]
Assets
Interest rate derivatives	0	[1]	0	[1]
Liabilities
Interest rate derivatives	0	[1]	0	[1]
Fair Value, Inputs, Level 3 [Member] | Not Designated as Hedging Instrument [Member]
Liabilities
Interest rate derivatives	0	[2]	0	[2]
Foreign exchange rate derivatives	$ 0	[2]	$ 0	[2]

[1] (1) Designated as hedges

[2] (2) Not designated as hedges

XML

Fair Value Disclosure (Details 2) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014		Mar. 31, 2013
Interest Expense [Member] | Fair Value Hedging [Member]
Impact of GATX's Derivative Instrument on Income Statement and Other comprehensive income (loss)
Interest expense	$ 2.1	[1]	$ 1.1	[1]
Interest Expense [Member] | Cash Flow Hedges [Member]
Impact of GATX's Derivative Instrument on Income Statement and Other comprehensive income (loss)
Effective portion reclassified from accumulated other comprehensive loss	1.2		1.2
Other Comprehensive Income (Loss) [Member] | Cash Flow Hedges [Member]
Impact of GATX's Derivative Instrument on Income Statement and Other comprehensive income (loss)
Other comprehensive loss (effective portion)	1.8		(0.3)
Operating Expense [Member] | Cash Flow Hedges [Member]
Impact of GATX's Derivative Instrument on Income Statement and Other comprehensive income (loss)
Effective portion reclassified from accumulated other comprehensive loss	2.4		0.4
Other Expense [Member] | Non-designated [Member]
Impact of GATX's Derivative Instrument on Income Statement and Other comprehensive income (loss)
Other expense	$ 0.1		$ 0.5

[1] (1) The fair value adjustments related to the underlying debt equally offset the amounts recognized in interest expense.

XML

Variable Interest Entities

3 Months Ended

Mar. 31, 2014

Variable Interest Entity, Not Primary Beneficiary, Disclosures [Abstract]

Variable Interest Entities

We are the primary beneficiary of one of our variable interest entities, a structured lease financing of a portfolio of railcars, because we have the power to direct its significant activities. As a result, we consolidate this variable interest entity. The risks associated with it are similar to those of our wholly owned railcar leasing activities.

The following table shows the carrying amounts of assets and liabilities of the consolidated variable interest entity (in millions):

	March 31 2014		December 31 2013
Operating assets, net of accumulated depreciation (1)	$	91.8	$	93.0
Nonrecourse debt	23.0		25.4

_________

(1) All operating assets are pledged as collateral on the nonrecourse debt.

We determined that we are not the primary beneficiary of our other variable interest entities, which are primarily investments in railcar and equipment leasing affiliates that were financed through a variety of equity investments and third party lending arrangements. We are not the primary beneficiary of these variable interest entities because we do not have the power to direct the activities that most significantly impact the entities’ economic performance. For investments in affiliates we determined were variable interest entities, we concluded that power was shared by the affiliate partners based on the terms of the relevant joint venture agreements, which require approval of all partners for significant decisions regarding the variable interest entity.

The following table shows the carrying amounts and maximum exposure to loss for our unconsolidated variable interest entities (in millions):

	March 31, 2014				December 31, 2013
	Net Carrying Amount		Maximum Exposure to Loss		Net Carrying Amount		Maximum Exposure to Loss
Investments in affiliates	$	129.4	$	129.4	$	125.5	$	125.5
Other investment	0.6		0.6		0.6		0.6
Total	$	130.0	$	130.0	$	126.1	$	126.1

XML

Fair Value Disclosure (Details 3) (USD $) In Millions, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Assets
Loans	$ 121.4	$ 122.7
Carrying Amount [Member]
Assets
Investment Funds	1.7	1.7
Loans	121.4	122.7
Liabilities
Recourse fixed rate debt	3,718.8	2,871.2
Recourse floating rate debt	591.2	894.7
Nonrecourse debt	70.1	72.6
Fair Value [Member]
Assets
Investment Funds	3.8	4.0
Loans	120.2	121.5
Liabilities
Recourse fixed rate debt	3,851.6	2,994.0
Recourse floating rate debt	595.4	906.2
Nonrecourse debt	$ 71.6	$ 74.7

XML

Earnings Per Share (Details) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Numerator:
Net income	$ 42.1	$ 27.1
Denominator:
Denominator for basic earnings per share — weighted average shares	46.0	46.9
Effect of dilutive securities:
Equity compensation plans	0.8	0.7
Convertible preferred stock	0	0.1
Denominator for diluted earnings per share — adjusted weighted average and assumed conversion	46.8	47.7
Basic earnings per share (in dollars per share)	$ 0.92	$ 0.58
Diluted earnings per share (in dollars per share)	$ 0.90	$ 0.57

XML

Consolidated Balance Sheets (USD $) In Millions, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Assets
Cash and Cash Equivalents	$ 447.0	$ 379.7
Restricted Cash	14.8	20.3
Receivables
Rent and other receivables	54.2	80.1
Loans	121.4	122.7
Finance leases	200.5	207.3
Less: allowance for losses	(5.2)	(5.2)
Receivables, net	370.9	404.9
Operating Assets and Facilities
Operating Assets and Facilities ($123.2 and $123.3 related to a consolidated VIE)	7,958.7	7,390.7
Less: allowance for depreciation ($31.4 and $30.3 related to a consolidated VIE)	(2,358.9)	(2,320.4)
Operating assets and facilities, net	5,599.8	5,070.3
Investments in Affiliated Companies	348.5	354.3
Goodwill	94.7	94.6
Other Assets	243.3	225.5
Total Assets	7,119.0	6,549.6
Liabilities and Shareholders’ Equity
Accounts Payable and Accrued Expenses	171.5	159.6
Debt
Commercial paper and borrowings under bank credit facilities	38.2	23.6
Recourse	4,310.0	3,765.9
Nonrecourse ($23.0 and $25.4 related to a consolidated VIE)	(70.1)	(72.6)
Capital lease obligations	7.6	8.9
Total Debt	4,425.9	3,871.0
Deferred Income Taxes	909.4	891.4
Other Liabilities	189.0	230.6
Total Liabilities	5,695.8	5,152.6
Shareholders’ Equity
Common stock, $0.625 par value: Authorized shares — 120,000,000 Issued shares — 66,529,703 and 66,349,906 Outstanding shares — 46,048,495 and 45,868,698	(41.4)	(41.3)
Additional paid in capital	(666.2)	(668.9)
Retained earnings	1,384.6	1,358.4
Accumulated other comprehensive loss	40.1	42.7
Treasury stock at cost (20,481,208 shares)	(628.9)	(628.9)
Total Shareholders’ Equity	1,423.2	1,397.0
Total Liabilities and Shareholders’ Equity	$ 7,119.0	$ 6,549.6

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Description of Business

3 Months Ended

Mar. 31, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Description of Business

Description of Business

As used herein, "GATX," "we," "us," "our," and similar terms refer to GATX Corporation and its subsidiaries, unless indicated otherwise.

We lease, operate, manage, and remarket long-lived, widely-used assets, primarily in the rail and marine markets. We also invest in joint ventures that complement our existing business activities. We report our financial results through fourprimary business segments: Rail North America, Rail International, American Steamship Company (“ASC”), and Portfolio Management.

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Share Based Compensation (Details Textual) (USD $) In Millions, except Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 3.1	$ 3.2
Tax benefit from share-based compensation expense	$ 1.2	$ 1.2
Stock Option SAR Awards [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Units granted during period	290,500
Restricted Stock and Performance Share Awards [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Units granted during period	53,680
Performance Shares [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Units granted during period	62,670
Phantom Stock Units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Units granted during period	4,363

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Commercial Commitments (Tables)

3 Months Ended

Mar. 31, 2014

Guarantees [Abstract]

Commercial Commitments

The following table shows our commercial commitments (in millions):

	March 31 2014		December 31 2013
Lease payment guarantees	$	33.1	$	34.8
Standby letters of credit	8.7		8.8
Asset residual value guarantees	—		5.6
Performance bonds	0.4		0.6
Total commercial commitments (1)	$	42.2	$	49.8

_________

(1) The carrying value of liabilities on the balance sheet for commercial commitments was $6.0 million at March 31, 2014 and $6.2 million at December 31, 2013. The expirations of these commitments range from 2014 to 2023. We are not aware of any event that would require us to satisfy any of our commitments.

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Share Based Compensation - Weighted Average and Assumptions (Details) (USD $)	3 Months Ended
	Mar. 31, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Estimated fair value	$ 18.90
Quarterly dividend rate	$ 0.33
Expected term of stock appreciation rights, in years	4 years 4 months 24 days
Risk-free interest rate	1.30%
Dividend yield	2.30%
Expected stock price volatility	30.30%
Present value of dividends	$ 5.76

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Accumulated Other Comprehensive Income (Loss) (Tables)

3 Months Ended

Mar. 31, 2014

Equity [Abstract]

Accumulated other comprehensive income (loss)

The following table shows the change in components for accumulated other comprehensive loss (in millions):

	Foreign Currency Translation Gain (Loss)		Unrealized Gain (Loss) on Securities			Unrealized Loss on Derivative Instruments			Post-Retirement Benefit Plans			Total
Balance at December 31, 2013	$	57.2	$	0.4		$	(22.1	)	$	(78.2	)	$	(42.7	)
Change in component	0.7		(0.5		)	(2.2		)	—			(2.0		)
Reclassification adjustments into earnings	—		—			3.6			2.4			6.0
Income tax effect	—		0.3			(0.7		)	(1.0		)	(1.4		)
Balance at March 31, 2014	$	57.9	$	0.2		$	(21.4	)	$	(76.8	)	$	(40.1	)

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Basis of Presentation

3 Months Ended

Mar. 31, 2014

Accounting Changes and Error Corrections [Abstract]

Change in Accounting Estimate, Description

Change in Accounting EstimateDuring the first quarter of 2014, we completed a review of the estimated useful lives used for our North American railcar fleet and determined that the economic service life of many of our railcars differed from the useful life currently used to calculate depreciation. As a result, effective January 1, 2014, we revised the estimated useful lives from a range of 30-38 years to a range of 27-42 years. In aggregate, the average depreciable life of the fleet increased approximately 2.2 years. The impact of these implemented changes on depreciation expense for affected assets in the first quarter of 2014 is a net decrease in depreciation expense of approximately $5.5 million and an increase in net income of $3.5 million, or $0.08 per diluted share. The full year impact for 2014 for affected assets is expected to be a decrease in depreciation expense of approximately $21.9 million and an increase in net income of $14.0 million, or approximately $0.30 per diluted share.

Basis of Presentation

Basis of Presentation

We prepared the accompanying unaudited consolidated financial statements in accordance with US Generally Accepted Accounting Principles ("GAAP") for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, our unaudited consolidated financial statements do not include all of the information and footnotes required for complete financial statements. We have included all of the normal recurring adjustments that we deemed necessary for a fair presentation.

Operating results for the three months ended March 31, 2014, are not necessarily indicative of the results we may achieve for the entire year ending December 31, 2014. In particular, ASC's fleet is inactive for a significant portion of the first quarter of each year due to winter conditions on the Great Lakes. In addition, asset remarketing income does not occur evenly throughout the year. For more information, refer to the consolidated financial statements and footnotes in our Annual Report on Form 10-K for the year ended December 31, 2013.

Change in Accounting Estimate

During the first quarter of 2014, we completed a review of the estimated useful lives used for our North American railcar fleet and determined that the economic service life of many of our railcars differed from the useful life currently used to calculate depreciation. As a result, effective January 1, 2014, we revised the estimated useful lives from a range of 30-38 years to a range of 27-42 years. In aggregate, the average depreciable life of the fleet increased approximately 2.2 years. The impact of these implemented changes on depreciation expense for affected assets in the first quarter of 2014 is a net decrease in depreciation expense of approximately $5.5 million and an increase in net income of $3.5 million, or $0.08 per diluted share. The full year impact for 2014 for affected assets is expected to be a decrease in depreciation expense of approximately $21.9 million and an increase in net income of $14.0 million, or approximately $0.30 per diluted share.

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Consolidated Balance Sheets (Parenthetical) (USD $) In Millions, except Share data, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Operating Assets and Facilities ($123.2 and $123.3 related to a consolidated VIE)	$ 7,958.7	$ 7,390.7
Less: allowance for depreciation ($31.4 and $30.3 related to a consolidated VIE)	(2,358.9)	(2,320.4)
Nonrecourse ($23.0 and $25.4 related to a consolidated VIE)	(70.1)	(72.6)
Common stock, par value	$ 0.625	$ 0.625
Common stock, shares authorized	120,000,000	120,000,000
Common stock, shares issued	66,529,703	66,349,906
Common stock, shares outstanding	46,048,495	45,868,698
Treasury stock, shares outstanding	20,481,208	20,118,120
Variable Interest Entity, Primary Beneficiary [Member]
Operating Assets and Facilities ($123.2 and $123.3 related to a consolidated VIE)	123.2	123.3
Less: allowance for depreciation ($31.4 and $30.3 related to a consolidated VIE)	(31.4)	(30.3)
Nonrecourse ($23.0 and $25.4 related to a consolidated VIE)	$ (23.0)	$ (25.4)

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Financial Data of Business Segments

3 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Financial Data of Business Segments

Financial Data of Business Segments

The financial data presented below depicts the profitability, financial position, and capital expenditures of each of our business segments.

We lease, operate, manage, and remarket long-lived, widely-used assets, primarily in the rail and marine markets. We also invest in joint ventures that complement our existing business activities. We report our financial results through fourprimary business segments: Rail North America, Rail International, American Steamship Company (“ASC”), and Portfolio Management.

Rail North America is comprised of our wholly owned operations in the United States, Canada, and Mexico, as well as two affiliate investments. Rail North America primarily provides railcars and locomotives pursuant to full-service leases under which it maintains the railcars, pays ad valorem taxes and insurance, and provides other ancillary services.

Rail International is comprised of our wholly owned European operations ("Rail Europe") and a recently established railcar leasing business in India ("Rail India"), as well as one development stage affiliate in China. Rail Europe leases railcars to customers throughout Europe pursuant to full-service leases under which it maintains the railcars and provides insurance, and other ancillary services.

ASC operates the largest fleet of US flagged vessels on the Great Lakes, providing waterborne transportation of dry bulk commodities such as iron ore, coal, limestone aggregates, and metallurgical limestone.

Portfolio Management provides leasing, shipping, asset remarketing and asset management services through a collection of diversified wholly owned assets and joint venture investments. Portfolio Management selectively invests in domestic marine assets and seeks to maximize the value of the existing portfolio of owned and managed assets and affiliate investments.

Segment profit is an internal performance measure used by the Chief Executive Officer to assess the performance of each segment in a given period. Segment profit includes all revenues, pretax earnings from affiliates, and net gains on asset dispositions that are attributable to the segments, as well as expenses that management believes are directly associated with the financing, maintenance, and operation of the revenue earning assets. Segment profit excludes selling, general and administrative expenses, income taxes, and certain other amounts not allocated to the segments. These amounts are included in Other.

We allocate debt balances and related interest expense to each segment based upon a predetermined fixed recourse leverage level expressed as a ratio of recourse debt (including off-balance-sheet debt) to equity. The leverage levels are 5:1 for Rail North America, 2:1 for Rail International, 1.5:1 for ASC, and 3:1 for Portfolio Management. We believe that by using this leverage and interest expense allocation methodology, each operating segment’s financial performance reflects appropriate risk-adjusted borrowing costs.

The following tables show certain segment data of each of our business segments (in millions):

	Rail North America			Rail International			ASC			Portfolio Management			Other			GATX Consolidated
Three Months Ended March 31, 2014
Profitability
Revenues
Lease revenue	$	194.9		$	47.2		$	1.1		$	7.4		$	—		$	250.6
Marine operating revenue	—			—			3.1			14.6			—			17.7
Other revenue	14.6			2.0			—			1.7			—			18.3
Total Revenues	209.5			49.2			4.2			23.7			—			286.6
Expenses
Maintenance expense	61.4			11.5			0.2			—			—			73.1
Marine operating expense	—			—			3.4			11.6			—			15.0
Depreciation expense	41.5			11.7			—			5.5			—			58.7
Operating lease expense	26.9			—			—			—			—			26.9
Other operating expense	4.8			1.4			—			0.4			—			6.6
Total Expenses	134.6			24.6			3.6			17.5			—			180.3
Other Income (Expense)
Net gain (loss) on asset dispositions	24.8			2.4			(0.4		)	1.3			—			28.1
Interest expense, net	(24.6		)	(6.2		)	(1.4		)	(6.8		)	(3.0		)	(42.0		)
Other (expense) income	(3.4		)	—			—			0.3			(0.3		)	(3.4		)
Share of affiliates' earnings (pretax)	3.3			(0.1		)	—			10.9			—			14.1
Segment Profit (Loss)	$	75.0		$	20.7		$	(1.2	)	$	11.9		$	(3.3	)	103.1
Selling, general and administrative expense																42.7
Income taxes (including $4.2 related to affiliates' earnings)																18.3
Net Income																$	42.1
Net Gain on Asset Dispositions
Asset Remarketing Income:
Disposition gains on owned assets	$	21.6		$	—		$	—		$	—		$	—		$	21.6
Residual sharing income	0.6			—			—			1.2			—			1.8
Non-remarketing disposition gains (1)	2.6			2.4			—			—			—			5.0
Asset impairment	—			—			(0.4		)	0.1			—			(0.3		)
	$	24.8		$	2.4		$	(0.4	)	$	1.3		$	—		$	28.1
Capital Expenditures
Portfolio investments and capital additions	$	396.0		$	39.3		$	8.3		$	—		$	1.9		$	445.5
Selected Balance Sheet Data at March 31, 2014
Investments in affiliated companies	$	21.9		$	1.9		$	—		$	324.7		$	—		$	348.5
Identifiable assets	$	4,186.8		$	1,327.1		$	267.1		$	854.6		$	483.4		$	7,119.0

_____

(1) Includes scrapping gains.

	Rail North America			Rail International			ASC			Portfolio Management			Other			GATX Consolidated
Three Months Ended March 31, 2013
Profitability
Revenues
Lease revenue	$	183.8		$	43.0		$	1.1		$	9.3		$	—		$	237.2
Marine operating revenue	—			—			12.3			6.2			—			18.5
Other revenue	13.8			2.2			—			0.6			—			16.6
Total Revenues	197.6			45.2			13.4			16.1			—			272.3
Expenses
Maintenance expense	54.6			11.5			0.6			—			—			66.7
Marine operating expense	—			—			9.8			6.8			—			16.6
Depreciation expense	42.3			10.1			—			5.5			—			57.9
Operating lease expense	32.3			—			—			—			—			32.3
Other operating expense	4.0			0.9			—			0.4			—			5.3
Total Expenses	133.2			22.5			10.4			12.7			—			178.8
Other Income (Expense)
Net gain on asset dispositions	10.2			1.2			—			5.3			—			16.7
Interest expense, net	(25.7		)	(5.6		)	(1.6		)	(6.7		)	(1.3		)	(40.9		)
Other (expense) income	(0.8		)	0.5			(0.6		)	—			(0.2		)	(1.1		)
Share of affiliates' earnings (pretax)	2.2			(0.2		)	—			10.5			—			12.5
Segment Profit (Loss)	$	50.3		$	18.6		$	0.8		$	12.5		$	(1.5	)	80.7
Selling, general and administrative expense																42.0
Income taxes (including $4.1 related to affiliates' earnings)																11.6
Net Income																$	27.1
Net Gain on Asset Dispositions
Asset Remarketing Income:
Disposition gains on owned assets	$	1.6		$	—		$	—		$	4.2		$	—		$	5.8
Residual sharing income	2.8			—			—			1.1			—			3.9
Non-remarketing disposition gains (1)	6.5			1.4			—			—			—			7.9
Asset impairment	(0.7		)	(0.2		)	—			—			—			(0.9		)
	$	10.2		$	1.2		$	—		$	5.3		$	—		$	16.7
Capital Expenditures
Portfolio investments and capital additions	$	85.7		$	44.3		$	3.2		$	16.0		$	0.7		$	149.9
Selected Balance Sheet Data at December 31, 2013
Investments in affiliated companies	$	31.4		$	2.0		$	—		$	320.9		$	—		$	354.3
Identifiable assets	$	3,710.5		$	1,297.1		$	271.0		$	856.9		$	414.1		$	6,549.6

_____

(1) Includes scrapping gains.

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Document and Entity Information In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014
Document and Entity Information [Abstract]
Entity Registrant Name	GATX Corporation
Entity Central Index Key	0000040211
Document Type	10-Q
Document Period End Date	Mar. 31, 2014
Amendment Flag	false
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q1
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding	46.0

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Variable Interest Entities (Tables)

3 Months Ended

Mar. 31, 2014

Variable Interest Entity, Not Primary Beneficiary, Disclosures [Abstract]

Carrying amounts of assets and liabilities of consolidated VIE

Variable Interest Entities

We are the primary beneficiary of one of our variable interest entities, a structured lease financing of a portfolio of railcars, because we have the power to direct its significant activities. As a result, we consolidate this variable interest entity. The risks associated with it are similar to those of our wholly owned railcar leasing activities.

The following table shows the carrying amounts of assets and liabilities of the consolidated variable interest entity (in millions):

	March 31 2014		December 31 2013
Operating assets, net of accumulated depreciation (1)	$	91.8	$	93.0
Nonrecourse debt	23.0		25.4

_________

(1) All operating assets are pledged as collateral on the nonrecourse debt.

We determined that we are not the primary beneficiary of our other variable interest entities, which are primarily investments in railcar and equipment leasing affiliates that were financed through a variety of equity investments and third party lending arrangements. We are not the primary beneficiary of these variable interest entities because we do not have the power to direct the activities that most significantly impact the entities’ economic performance. For investments in affiliates we determined were variable interest entities, we concluded that power was shared by the affiliate partners based on the terms of the relevant joint venture agreements, which require approval of all partners for significant decisions regarding the variable interest entity.

Carrying amounts and maximum exposure to loss for non consolidated VIEs

The following table shows the carrying amounts and maximum exposure to loss for our unconsolidated variable interest entities (in millions):

	March 31, 2014				December 31, 2013
	Net Carrying Amount		Maximum Exposure to Loss		Net Carrying Amount		Maximum Exposure to Loss
Investments in affiliates	$	129.4	$	129.4	$	125.5	$	125.5
Other investment	0.6		0.6		0.6		0.6
Total	$	130.0	$	130.0	$	126.1	$	126.1

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Consolidated Statements of Comprehensive Income (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Revenues
Lease revenue	$ 250.6	$ 237.2
Marine operating revenue	17.7	18.5
Other revenue	18.3	16.6
Total Revenues	286.6	272.3
Expenses
Maintenance expense	73.1	66.7
Marine operating expense	15.0	16.6
Depreciation	58.7	57.9
Operating lease expense	26.9	32.3
Other operating expense	6.6	5.3
Selling, general and administrative	42.7	42.0
Total Expenses	223.0	220.8
Other Income (Expense)
Net gain on asset dispositions	28.1	16.7
Interest expense, net	(42.0)	(40.9)
Other (expense) income	(3.4)	(1.1)
Income before Income Taxes and Share of Affiliates’ Earnings	46.3	26.2
Income Taxes	(14.1)	(7.5)
Share of Affiliates’ Earnings (net of tax)	9.9	8.4
Net Income	42.1	27.1
Other Comprehensive Income, net of taxes
Foreign currency translation adjustments	(0.7)	17.0
Unrealized gain (loss) on securities	0.2	(0.1)
Unrealized gain (loss) on derivative instruments	(0.7)	(1.5)
Post-retirement benefit plans	1.4	2.0
Other comprehensive income (loss)	2.6	(13.4)
Comprehensive Income	$ 44.7	$ 13.7
Share Data
Basic earnings per share (in dollars per share)	$ 0.92	$ 0.58
Average number of common shares (in shares)	46.0	46.9
Diluted earnings per share (in dollars per share)	$ 0.90	$ 0.57
Average number of common shares and common share equivalents (in shares)	46.8	47.7
Dividends declared per common share (in dollars per share)	$ 0.33	$ 0.31

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Income Taxes

3 Months Ended

Mar. 31, 2014

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Our effective tax rate was 30% for the three months ended March 31, 2014, compared to 29% for the three months ended March 31, 2013. The difference in the effective rates for each period, compared to the statutory rate of 35%, is primarily attributable to the mix of pretax income in each year among domestic and foreign jurisdictions which are taxed at different rates.

As of March 31, 2014, our gross liability for unrecognized tax benefits was $5.3 million. If fully recognized, these tax benefits would decrease our income tax expense by $5.3 million ($3.4 million, net of federal tax). During the three months ended March 31, 2014, upon the close of a foreign tax audit, we released a gross unrecognized tax benefit of $0.4 million. We do not anticipate the recognition of any tax benefits that were previously unrecognized within the next 12 months.

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Share-Based Compensation

3 Months Ended

Mar. 31, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Share-Based Compensation

Share-Based Compensation

During the first three months of 2014, we granted 290,500 stock appreciation rights (“SARs”), 53,680 restricted stock units, 62,670 performance shares, and 4,363 phantom stock units. For the three months endedMarch 31, 2014, total share-based compensation expense was $3.1 million and the related tax benefit was $1.2 million. For the three months endedMarch 31, 2013, total share-based compensation expense was $3.2 million and the related tax benefit was $1.2 million.

The estimated fair value of our 2014 SARs awards and related underlying assumptions are shown in the table below.

	2014
Estimated fair value	$	18.90
Quarterly dividend rate	$	0.33
Expected term of stock appreciation rights, in years	4.4
Risk-free interest rate	1.3		%
Dividend yield	2.3		%
Expected stock price volatility	30.3		%
Present value of dividends	$	5.76

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Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2014

Earnings Per Share [Abstract]

Computation of basic and diluted net income per common share

he following table shows the computation of our basic and diluted net income per common share (in millions, except per share amounts):

	Three Months Ended March 31
	2014		2013
Numerator:
Net income	$	42.1	$	27.1
Denominator:
Weighted average shares outstanding - basic	46.0		46.9
Effect of dilutive securities:
Equity compensation plans	0.8		0.7
Convertible preferred stock	—		0.1
Weighted average shares outstanding - diluted	46.8		47.7
Basic earnings per share	$	0.92	$	0.58
Diluted earnings per share	$	0.90	$	0.57

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Fair Value Disclosure (Tables)

3 Months Ended

Mar. 31, 2014

Fair Value Disclosures [Abstract]

Non-recurring Level 3 fair value measurements

Fair Value Disclosure

The following tables show our assets and liabilities that are measured at fair value on a recurring basis (in millions):

Assets	March 31, 2014		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs    (Level 3)
Interest rate derivatives (1)	$	4.8	$	—	$	4.8	$	—
Available-for-sale equity securities	4.2		4.2		—		—
Liabilities
Interest rate derivatives (1)	3.1		—		3.1		—
Interest rate derivatives (2)	0.2		—		0.2		—
Foreign exchange rate derivatives (2)	2.6		—		2.6		—

Assets	December 31, 2013		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Interest rate derivatives (1)	$	6.0	$	—	$	6.0	$	—
Available-for-sale equity securities	4.7		4.7		—		—
Liabilities
Interest rate derivatives (1)	0.8		—		0.8		—
Interest rate derivatives (2)	0.2		—		0.2		—
Foreign exchange rate derivatives (2)	2.6		—		2.6		—

_________

(1) Designated as hedges.

(2) Not designated as hedges.

We base our valuations of available-for-sale equity securities on their quoted prices on an active exchange. We value derivatives using a pricing model with inputs (such as yield curves and credit spreads) that are observable in the market or that can be derived principally from observable market data.

Derivative instruments

Fair Value Hedges

We use interest rate swaps to manage the fixed-to-floating rate mix of our debt obligations by converting the fixed rate debt to floating rate debt. For fair value hedges, we recognize changes in fair value of both the derivative and the hedged item as interest expense. We had six instruments outstanding with an aggregate notional amount of $500.0 million as of March 31, 2014, and three instruments outstanding with an aggregate notional amount of $200.0 million as of December 31, 2013. These derivatives have maturities ranging from 2015 to 2019.

Cash Flow Hedges

We use interest rate swaps to convert floating rate debt to fixed rate debt. We also use Treasury rate locks to hedge our exposure to interest rate risk on anticipated transactions. We had six instruments outstanding with an aggregate notional amount of $163.5 million as of March 31, 2014, and six instruments outstanding with an aggregate notional amount of $163.6 million as of December 31, 2013. These derivatives had maturities ranging from 2014 to 2020. Within the next 12 months, we expect to reclassify $9.5 million ($6.0 million after-tax) of net losses on previously terminated derivatives from accumulated other comprehensive loss. We reclassify these amounts when interest and operating lease expense on the related hedged transactions affect earnings.

Non-designated Derivatives

We do not hold derivative financial instruments for purposes other than hedging, although certain of our derivatives are not designated as accounting hedges. We recognize changes in the fair value of these derivatives in other (income) expense immediately.

Some of our derivative instruments contain credit risk provisions that could require us to make immediate payment on net liability positions in the event that we default on certain outstanding debt obligations. The aggregate fair value of our derivative instruments with credit risk related contingent features that are in a liability position as of March 31, 2014, was $4.2 million. We are not required to post any collateral on our derivative instruments and do not expect the credit risk provisions to be triggered.

In the event that a counterparty fails to meet the terms of an interest rate swap agreement or a foreign exchange contract, our exposure is limited to the fair value of the swap, if in our favor. We manage the credit risk of counterparties by transacting with institutions that we consider financially sound and by avoiding concentrations of risk with a single counterparty. We believe that the risk of non-performance by any of our counterparties is remote.

The following table shows the impacts of our derivative instruments on our statement of comprehensive loss (in millions):

		Three Months Ended March 31
Derivative Designation	Location of Loss (Gain) Recognized	2014		2013
Fair value hedges (1)	Interest expense	$	2.1	$	1.1
Cash flow hedges	Other comprehensive loss (gain) (effective portion)	1.8		(0.3		)
Cash flow hedges	Interest expense (effective portion reclassified from accumulated other comprehensive loss)	1.2		1.2
Cash flow hedges	Operating lease expense (effective portion reclassified from accumulated other comprehensive loss)	2.4		0.4
Non-designated	Other expense	0.1		0.5

_________

(1) The fair value adjustments related to the underlying debt equally offset the amounts recognized in interest expense.

Other Financial Instruments

The carrying amounts of cash and cash equivalents, restricted cash, rent and other receivables, accounts payable, and commercial paper and bank credit facilities approximate fair value due to the short maturity of those instruments. We base the fair values of investment funds, which are accounted for under the cost method, on the best information available, which may include quoted investment fund values. We estimate the fair values of loans and fixed and floating rate debt using discounted cash flow analyses based on interest rates currently offered for loans with similar terms to borrowers of similar credit quality. The inputs we use to estimate each of these values are classified in Level 2 of the fair value hierarchy because they are directly or indirectly observable inputs.

The following table shows the carrying amounts and fair values of our other financial instruments as of (in millions):

	March 31, 2014				December 31, 2013
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Assets
Investment funds	$	1.7	$	3.8	$	1.7	$	4.0
Loans	121.4		120.2		122.7		121.5
Liabilities
Recourse fixed rate debt	$	3,718.8	$	3,851.6	$	2,871.2	$	2,994.0
Recourse floating rate debt	591.2		595.4		894.7		906.2
Nonrecourse debt	70.1		71.6		72.6		74.7

The following table shows the carrying amounts and fair values of our other financial instruments as of (in millions):

	March 31, 2014				December 31, 2013
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Assets
Investment funds	$	1.7	$	3.8	$	1.7	$	4.0
Loans	121.4		120.2		122.7		121.5
Liabilities
Recourse fixed rate debt	$	3,718.8	$	3,851.6	$	2,871.2	$	2,994.0
Recourse floating rate debt	591.2		595.4		894.7		906.2
Nonrecourse debt	70.1		71.6		72.6		74.7

Derivative instruments

Fair Value Hedges

We use interest rate swaps to manage the fixed-to-floating rate mix of our debt obligations by converting the fixed rate debt to floating rate debt. For fair value hedges, we recognize changes in fair value of both the derivative and the hedged item as interest expense. We had six instruments outstanding with an aggregate notional amount of $500.0 million as of March 31, 2014, and three instruments outstanding with an aggregate notional amount of $200.0 million as of December 31, 2013. These derivatives have maturities ranging from 2015 to 2019.

Cash Flow Hedges

We use interest rate swaps to convert floating rate debt to fixed rate debt. We also use Treasury rate locks to hedge our exposure to interest rate risk on anticipated transactions. We had six instruments outstanding with an aggregate notional amount of $163.5 million as of March 31, 2014, and six instruments outstanding with an aggregate notional amount of $163.6 million as of December 31, 2013. These derivatives had maturities ranging from 2014 to 2020. Within the next 12 months, we expect to reclassify $9.5 million ($6.0 million after-tax) of net losses on previously terminated derivatives from accumulated other comprehensive loss. We reclassify these amounts when interest and operating lease expense on the related hedged transactions affect earnings.

Non-designated Derivatives

We do not hold derivative financial instruments for purposes other than hedging, although certain of our derivatives are not designated as accounting hedges. We recognize changes in the fair value of these derivatives in other (income) expense immediately.

Some of our derivative instruments contain credit risk provisions that could require us to make immediate payment on net liability positions in the event that we default on certain outstanding debt obligations. The aggregate fair value of our derivative instruments with credit risk related contingent features that are in a liability position as of March 31, 2014, was $4.2 million. We are not required to post any collateral on our derivative instruments and do not expect the credit risk provisions to be triggered.

In the event that a counterparty fails to meet the terms of an interest rate swap agreement or a foreign exchange contract, our exposure is limited to the fair value of the swap, if in our favor. We manage the credit risk of counterparties by transacting with institutions that we consider financially sound and by avoiding concentrations of risk with a single counterparty. We believe that the risk of non-performance by any of our counterparties is remote.

The following table shows the impacts of our derivative instruments on our statement of comprehensive loss (in millions):

		Three Months Ended March 31
Derivative Designation	Location of Loss (Gain) Recognized	2014		2013
Fair value hedges (1)	Interest expense	$	2.1	$	1.1
Cash flow hedges	Other comprehensive loss (gain) (effective portion)	1.8		(0.3		)
Cash flow hedges	Interest expense (effective portion reclassified from accumulated other comprehensive loss)	1.2		1.2
Cash flow hedges	Operating lease expense (effective portion reclassified from accumulated other comprehensive loss)	2.4		0.4
Non-designated	Other expense	0.1		0.5

_________

(1) The fair value adjustments related to the underlying debt equally offset the amounts recognized in interest expense.

Fair Value Measurements, Recurring and Nonrecurring

The following tables show our assets and liabilities that are measured at fair value on a recurring basis (in millions):

Assets	March 31, 2014		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs    (Level 3)
Interest rate derivatives (1)	$	4.8	$	—	$	4.8	$	—
Available-for-sale equity securities	4.2		4.2		—		—
Liabilities
Interest rate derivatives (1)	3.1		—		3.1		—
Interest rate derivatives (2)	0.2		—		0.2		—
Foreign exchange rate derivatives (2)	2.6		—		2.6		—

Assets	December 31, 2013		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Interest rate derivatives (1)	$	6.0	$	—	$	6.0	$	—
Available-for-sale equity securities	4.7		4.7		—		—
Liabilities
Interest rate derivatives (1)	0.8		—		0.8		—
Interest rate derivatives (2)	0.2		—		0.2		—
Foreign exchange rate derivatives (2)	2.6		—		2.6		—

_________

(1) Designated as hedges.

(2) Not designated as hedges.

We base our valuations of available-for-sale equity securities on their quoted prices on an active exchange. We value derivatives using a pricing model with inputs (such as yield curves and credit spreads) that are observable in the market or that can be derived principally from observable market data.

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Accumulated Other Comprehensive Income (Loss)

3 Months Ended

Mar. 31, 2014

Equity [Abstract]

Accumulated Other Comprehensive Income (Loss)

Accumulated Other Comprehensive Loss

The following table shows the change in components for accumulated other comprehensive loss (in millions):

	Foreign Currency Translation Gain (Loss)		Unrealized Gain (Loss) on Securities			Unrealized Loss on Derivative Instruments			Post-Retirement Benefit Plans			Total
Balance at December 31, 2013	$	57.2	$	0.4		$	(22.1	)	$	(78.2	)	$	(42.7	)
Change in component	0.7		(0.5		)	(2.2		)	—			(2.0		)
Reclassification adjustments into earnings	—		—			3.6			2.4			6.0
Income tax effect	—		0.3			(0.7		)	(1.0		)	(1.4		)
Balance at March 31, 2014	$	57.9	$	0.2		$	(21.4	)	$	(76.8	)	$	(40.1	)

________

See "Note 4. Fair Value Disclosure" and "Note 5. Pension and Other Post-Retirement Benefits" for impacts of the reclassification adjustments on the statement of comprehensive income.

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Commercial Commitments

3 Months Ended

Mar. 31, 2013

Guarantees [Abstract]

Commercial Commitments

Commercial Commitments

We have entered into various commercial commitments, such as guarantees and standby letters of credit, related to certain transactions. These commercial commitments require us to fulfill specific obligations in the event of third party demands. Similar to our balance sheet investments, these commitments expose us to credit, market, and equipment risk. Accordingly, we evaluate these commitments and other contingent obligations using techniques similar to those we use to evaluate funded transactions.

The following table shows our commercial commitments (in millions):

	March 31 2014		December 31 2013
Lease payment guarantees	$	33.1	$	34.8
Standby letters of credit	8.7		8.8
Asset residual value guarantees	—		5.6
Performance bonds	0.4		0.6
Total commercial commitments (1)	$	42.2	$	49.8

_________

(1) The carrying value of liabilities on the balance sheet for commercial commitments was $6.0 million at March 31, 2014 and $6.2 million at December 31, 2013. The expirations of these commitments range from 2014 to 2023. We are not aware of any event that would require us to satisfy any of our commitments.

Lease payment guarantees are commitments to financial institutions to make lease payments for a third party in the event they default. We reduce any liability that may result from these guarantees by the value of the underlying asset or group of assets.

We are also parties to standby letters of credit and performance bonds, which primarily relate to contractual obligations and general liability insurance coverages. No material claims have been made against these obligations, and no material losses are anticipated.

Asset residual value guarantees are commitments to third parties that an asset or group of assets will be worth a specified value at the end of a lease term. We earn a fee for providing these guarantees, which we amortize into income over the guarantee period. If the assets are disposed of for more than the amount we guaranteed, we receive a share of the proceeds in excess of the guaranteed amount. We record these residual sharing gains in our net gain on asset dispositions. If the net realizable value of the asset is less than the guaranteed amount, we incur a liability for the amount we guaranteed less the value realized from the asset's disposal.

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Earnings Per Share

3 Months Ended

Mar. 31, 2014

Earnings Per Share [Abstract]

Earnings Per Share

Earnings per Share

We compute basic earnings per share by dividing net income available to our common shareholders by the weighted average number of shares of our common stock outstanding. We appropriately weighted shares issued or reacquired during the period that they were outstanding. Our diluted earnings per share reflect the impacts of our potentially dilutive securities, which include our convertible preferred stock and our equity compensation awards.

In the second quarter of 2013, both series of our preferred stock were retired with all shares either converted to common stock or redeemed.

The following table shows the computation of our basic and diluted net income per common share (in millions, except per share amounts):

	Three Months Ended March 31
	2014		2013
Numerator:
Net income	$	42.1	$	27.1
Denominator:
Weighted average shares outstanding - basic	46.0		46.9
Effect of dilutive securities:
Equity compensation plans	0.8		0.7
Convertible preferred stock	—		0.1
Weighted average shares outstanding - diluted	46.8		47.7
Basic earnings per share	$	0.92	$	0.58
Diluted earnings per share	$	0.90	$	0.57

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Legal Proceedings and Other Contingencies

3 Months Ended

Mar. 31, 2014

Commitments and Contingencies Disclosure [Abstract]

Legal Proceedings and Other Contingencies

OTE 11. Legal Proceedings and Other Contingencies

Various legal actions, claims, assessments and other contingencies arising in the ordinary course of business are pending against GATX and certain of our subsidiaries. These matters are subject to many uncertainties, and it is possible that some of these matters could ultimately be decided, resolved or settled adversely. For a full discussion of our pending legal matters, please refer to "Note 23. Legal Proceedings and Other Contingencies" of our consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2013.

Viareggio Derailment

In June 2009, a train consisting of fourteen liquefied petroleum gas (“LPG”) tank cars owned by GATX Rail Austria GmbH (an indirect subsidiary of the Company, "GATX Rail Austria") and its subsidiaries derailed while passing through the City of Viareggio, in the province of Lucca, Italy. Five tank cars overturned and one of the overturned cars was punctured by a peg or obstacle along the side of the track, resulting in a release of LPG, which subsequently ignited. Thirty-two people died and others were injured in the fire, which also resulted in property damage. The LPG tank cars were leased to FS Logistica S.p.A., a subsidiary of the Italian state-owned railway, Ferrovie dello Stato S.p.A (the “Italian Railway”).

On December 14, 2012, the Public Prosecutors of Lucca ("Public Prosecutors") formally charged GATX Rail Austria and two of its subsidiaries (collectively, "GRA"), as well as ten maintenance and supervisory employees (the "Employees"), with various negligence-based crimes related to the accident, all of which are punishable under Italian law by incarceration, damages and fines. Similar charges were brought against four Italian Railway companies and eighteen of their employees, among others. The Public Prosecutors assert that the axle on a tank car broke, causing the derailment and resulting in a tank rupture and release of LPG, after the car hit an obstacle placed on the side of the track by the Italian Railway. The Public Prosecutors further allege that a crack in the axle was detectable at the time of final inspection but was overlooked by the Employees at the Jungenthal Waggon GmbH workshop (a subsidiary of GATX Rail Austria). The trial in the Court of Lucca (the “Lucca Trial”) commenced on November 13, 2013.

With respect to civil claims, GRA’s insurers continue to work cooperatively with the insurer for the Italian Railway to adjust and settle personal injury and property damage claims. These joint settlement efforts have so far settled most of the significant civil claims related to the accident; however, approximately 90 civil claimants did not settle and are currently parties to the Lucca Trial. The Court of Lucca will determine both the civil and criminal liability of the defendants in the one proceeding. GRA believes that it and its Employees acted diligently and properly with respect to applicable legal and industry standards, but expects that its insurers will cover any civil damages if awarded to the claimants in the Lucca trial.

Since May 2012, the excess insurer providing coverage, Liberty Mutual Insurance Europe Limited (“Liberty”) has settled civil claims but has refused to reimburse GRA for its ongoing legal defense fees and costs, taking a position contrary to insurers in the prior underlying layers who had provided coverage for such expenses. To date, GRA has incurred approximately $5.6 million in unreimbursed defense fees and costs at the Liberty coverage layer and continues to incur costs in connection with the Lucca Trial. Consequently, in October 2013, GRA filed an arbitration proceeding against Liberty seeking to recoup its unreimbursed defense fees and costs (the “Liberty Arbitration”). The Liberty excess layer is currently fully exhausted and, therefore, the issue of reimbursement for outstanding defense costs will now be determined by the four insurers in the next coverage layer, which includes 25% held by Liberty. GRA cannot predict the outcome of the Liberty Arbitration, the amount of defense fees and costs that ultimately may not be reimbursed by Liberty, or the positions other excess insurers in the current coverage layer may take with respect to defense fees and costs.

GATX cannot predict the outcome of the Lucca Trial or what other legal proceedings or claims, if any, may be initiated against GRA or its personnel, and, therefore, cannot reasonably estimate the possible amount or range of loss that may ultimately be incurred in connection with this accident. Accordingly, we have not established any accruals with respect to this matter.

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Pension and Other Post-Retirement Benefits (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Defined Benefit Pension [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 1.4	$ 1.8
Interest cost	5.1	4.6
Expected return on plan assets	(7.2)	(6.9)
Unrecognized prior service credit	(0.2)	(0.3)
Unrecognized net actuarial loss	2.6	3.5
Net expense	1.7	2.7
Retiree Health and Life [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	0	0.1
Interest cost	0.4	0.4
Expected return on plan assets	0	0
Unrecognized prior service credit	0	0
Unrecognized net actuarial loss	0	0.1
Net expense	$ 0.4	$ 0.6

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Share Based Compensation (Tables)

3 Months Ended

Mar. 31, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Weighted Average Fair Value and Assumptions

The estimated fair value of our 2014 SARs awards and related underlying assumptions are shown in the table below.

	2014
Estimated fair value	$	18.90
Quarterly dividend rate	$	0.33
Expected term of stock appreciation rights, in years	4.4
Risk-free interest rate	1.3		%
Dividend yield	2.3		%
Expected stock price volatility	30.3		%
Present value of dividends	$	5.76

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Description of Business (Details)	3 Months Ended
	Mar. 31, 2014 Segment
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of business segments	4

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Accumulated Other Comprehensive Income (Loss) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Equity [Abstract]
Beginning Balance, Foreign Currency Translation Gain (Loss)	$ 57.2
Change in Foreign Currency Translation Gain (Loss)	0.7
Foreign currency translation gain loss before reclassification adjustment into earnings	0
Foreign Currency Translation Gain (Loss), Income tax effect	0
Ending Balance, Foreign Currency Translation Gain (Loss)	57.9
Beginning Balance, Unrealized Gain (Loss) on Securities	0.4
Change in Unrealized Gain (Loss) on Securities	(0.5)
Unrealized Gain (Loss) on Securities, Reclassification adjustments into earnings	0
Unrealized Gain (Loss) on Securities, Income tax effect	0.3
Ending Balance, Unrealized Gain (Loss) on Securities	0.2
Beginning Balance, Unrealized Loss on Derivative Instruments	(22.1)
Change in Unrealized Loss on Derivative Instruments	(2.2)
Unrealized Loss on Derivative Instruments, Reclassification adjustments into earnings	3.6
Unrealized Loss on Derivative Instruments, Income tax effect	(0.7)
Ending Balance, Unrealized Loss on Derivative Instruments	(21.4)
Beginning Balance, Post-Retirement Benefit Plans	(78.2)
Change in Post-Retirement Benefit Plans	0
Post-Retirement Benefit Plans, Reclassification adjustments into earnings	2.4
Post-Retirement Benefit Plans, Income tax effect	(1.0)
Ending Balance, Post-Retirement Benefit Plans	(76.8)
Other Comprehensive Income Change in Component	(2.0)
Reclassification adjustments into earnings, Total	6.0
Income tax effect, Total	(1.4)
Accumulated other comprehensive income (loss), net of tax	$ (40.1)	$ (42.7)

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Consolidated Statements of Cash Flows (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014 railcar	Mar. 31, 2013 railcar
Number of railcars received	62	182
Noncash or Part Noncash Acquisition, Value of Assets Acquired	$ 1.1	$ 1.8
Operating Activities
Net income	42.1	27.1
Depreciation, Nonproduction	62.1	60.9
Adjustments to reconcile income to net cash provided by operating activities:
Gains on sales of assets	(26.9)	(13.8)
Change in Accrued Operating Lease Expense	(39.8)	(46.0)
Asset impairment charges	(0.3)	(0.9)
Deferred income taxes	(11.0)	(4.3)
Share of affiliates’ earnings, net of dividends	1.9	(7.9)
Other Operating Activities, Cash Flow Statement	1.0	(0.4)
Net cash provided by operating activities	51.4	24.2
Investing Activities
Additions to operating assets and facilities	(445.5)	(141.4)
Loans extended	0	(8.5)
Portfolio investments and capital additions	(445.5)	(149.9)
Purchases of leased-in assets	(150.5)	(11.3)
Portfolio proceeds	(66.6)	(64.5)
Proceeds from sales of other assets	(7.0)	(8.7)
Net decrease (increase) in restricted cash	5.5	2.8
Payments for (Proceeds from) Other Investing Activities	0	(0.1)
Net cash used in investing activities	(516.9)	(85.3)
Financing Activities
Net proceeds from issuances of debt (original maturities longer than 90 days)	842.5	597.9
Repayments of debt (original maturities longer than 90 days)	(307.1)	(264.9)
Net increase (decrease) in debt with original maturities of 90 days or less	(14.5)	149.7
Payments for Repurchase of Common Stock	0	(18.3)
Dividends	(16.9)	(16.3)
Proceeds from (Payments for) Other Financing Activities	(1.2)	(0.3)
Net cash (used in) provided by financing activities	(531.8)	(148.4)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	1.0	(0.4)
Net (decrease) increase in Cash and Cash Equivalents during the period	67.3	86.9
Cash and Cash Equivalents at beginning of period	379.7	234.2
Cash and Cash Equivalents at end of period	$ 447.0	$ 321.1

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Pension and Other Post-Retirement Benefits

3 Months Ended

Mar. 31, 2014

Compensation and Retirement Disclosure [Abstract]

Pension and Other Post-Retirement Benefits

Pension and Other Post-Retirement Benefits

The following table shows components of our pension and other post-retirement benefits expense for the three months ended March 31, 2014 and 2013 (in millions):

	2014 Pension Benefits			2013 Pension Benefits			2014 Retiree Health and Life		2013 Retiree Health and Life
Service cost	$	1.4		$	1.8		$	—	$	0.1
Interest cost	5.1			4.6			0.4		0.4
Expected return on plan assets	(7.2		)	(6.9		)	—		—
Amortization of (1):
Unrecognized prior service credit	(0.2		)	(0.3		)	—		—
Unrecognized net actuarial loss	2.6			3.5			—		0.1
Net expense	$	1.7		$	2.7		$	0.4	$	0.6

_________

(1) Amounts reclassified from accumulated other comprehensive loss.

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Basis of Presentation Basis of Presentation (non-printing) (Details) (USD $)	3 Months Ended			12 Months Ended	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014 Service Life [Member]	Dec. 31, 2014 Service Life [Member]	Mar. 31, 2014 Railcars [Member] Service Life [Member]	Mar. 31, 2014 Railcars [Member] Minimum [Member]	Mar. 31, 2014 Railcars [Member] Minimum [Member] Service Life [Member]	Mar. 31, 2014 Railcars [Member] Maximum [Member]	Mar. 31, 2014 Railcars [Member] Maximum [Member] Service Life [Member]
Change in Accounting Estimate [Line Items]
Change in accounting estimate			$ 3,500,000	$ 14,000,000.0
Property, Plant and Equipment, Useful Life						30 years	27 years	38 years	42 years
Average Increase (Decrease) in Estimated Railcar Useful Life					2 years 2 months 12 days
Depreciation, Nonproduction	62,100,000	60,900,000	0	21,900,000
Net Income (Loss) Attributable to Parent	$ 42,100,000	$ 27,100,000
Earnings Per Share, Diluted	$ 0.90	$ 0.57
New Accounting Pronouncement or Change in Accounting Principle, Effect of Change on Diluted Earnings Per Share			$ 0.08	$ 0.30

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Commercial Commitments (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2014		Dec. 31, 2013
Guarantor Obligations [Line Items]
Total commercial commitments	$ 42.2	[1]	$ 49.8	[1]
Lease payment guarantees [Member]
Guarantor Obligations [Line Items]
Total commercial commitments	33.1		34.8
Asset residual value guarantees [Member]
Guarantor Obligations [Line Items]
Total commercial commitments	0		5.6
Standby letters of credit [Member]
Guarantor Obligations [Line Items]
Total commercial commitments	8.7		8.8
Performance bonds [Member]
Guarantor Obligations [Line Items]
Total commercial commitments	$ 0.4		$ 0.6

[1] (1) The carrying value of liabilities on the balance sheet for commercial commitments was $6.0 million at March 31, 2014 and $6.2 million at December 31, 2013. The expirations of these commitments range from 2014 to 2023. We are not aware of any event that would require us to satisfy any of our commitments.

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Pension and Other Post-Retirement Benefits (Tables)

3 Months Ended

Mar. 31, 2014

Compensation and Retirement Disclosure [Abstract]

Pension obligations and plan assets and other post-retirement obligations

The following table shows components of our pension and other post-retirement benefits expense for the three months ended March 31, 2014 and 2013 (in millions):

	2014 Pension Benefits			2013 Pension Benefits			2014 Retiree Health and Life		2013 Retiree Health and Life
Service cost	$	1.4		$	1.8		$	—	$	0.1
Interest cost	5.1			4.6			0.4		0.4
Expected return on plan assets	(7.2		)	(6.9		)	—		—
Amortization of (1):
Unrecognized prior service credit	(0.2		)	(0.3		)	—		—
Unrecognized net actuarial loss	2.6			3.5			—		0.1
Net expense	$	1.7		$	2.7		$	0.4	$	0.6

_________

(1) Amounts reclassified from accumulated other comprehensive loss.