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 GATX Corporation

233 S. Wacker Drive

Chicago, IL  60606-7147

Thomas A. Ellman

Executive Vice President and Chief Financial Officer

Tel: 312.621.4560

Fax: 312.499.7332

thomas.ellman@gatx.com

August 14, 2023

Division of Corporation Finance

Office of Energy & Transportation

100 F Street, N.E.

Washington, D.C. 20549

Attention: Ms. Yolanda Guobadia

 Mr. Robert Babula

Re: GATX Corporation

 Form 10-K for the Fiscal Year Ended December 31, 2022

 Filed February 16, 2023

 File No. 001-02328

Dear Sir or Madam:

On behalf of GATX Corporation (“GATX” or the “Company”), I am submitting the Company’s response to the comment from the staff of the Division of Corporation Finance (the “Staff”) of the U.S. Securities and Exchange Commission raised in your letter dated July 7, 2023. The Staff’s comment was provided with respect to the Company’s letter dated June 26, 2023 (the “Prior Response”), which was provided in response to the Staff’s comment letter dated June 9, 2023. For ease of reference, the Staff’s comment is duplicated below in bold type and is followed immediately by the Company’s response.

Form 10-K for the Fiscal Year Ended December 31, 2022

Financial Statements

Note 12 – Share-Based Compensation, page 87

We understand from your response to prior comment one that although the errors concerning participating securities resulted in higher earnings per share during each quarter over the last three fiscal years than should have been reported, you do not consider the errors to be material and would prefer to limit compliance with the requirements in FASB ASC 260, concerning use of the two-class method of calculating basic and diluted earnings per share, to future filings beginning with your next quarterly report.

Please clarify how you will address the errors in the comparable periods when filing future periodic reports and the manner by which you will advise investors in a timely fashion of the correct earnings per share figures that pertain to the last three fiscal years.

August 14, 2023

Securities and Exchange Commission

Page 2

As detailed in the Company’s Prior Response, considering quantitative and qualitative factors, we concluded that the impacts of this error to basic and diluted earnings per share (“EPS”) for the first quarter of 2023 and annual and interim periods of 2022, 2021 and 2020 are immaterial. As a result, when filing future periodic reports (and consistent with our Quarterly Report on Form 10-Q for the quarter ended June 30, 2023, which was filed on July 27, 2023), the Company does not intend to address the effect of this immaterial error in the comparable periods or disclose the corrected EPS figures that pertain to the last three fiscal years, which is in accordance with ASC 105-10-05-6 (“The provisions of the [Financial Accounting Standards Board Accounting Standards] Codification need not be applied to immaterial items.”)

We believe our approach is appropriate given the immaterial nature of the error and the fact that a reasonable investor, considering the mix of information available, would not be impacted by the correction of this immaterial error in prior periods. In addition to the SAB 99 analysis provided in our Prior Response, we believe the below quantitative and qualitative factors further support our conclusion that correcting this immaterial error in prior periods is not necessary or meaningful to investors:

•The impact of the error correction would result in a change to basic and diluted EPS from continuing operations of between 0.9% and 3.9% for all reporting periods, except for two quarters (the second quarters of 2022 and 2021).

◦Net income in the second quarter of 2022 was unusually low due to the negative impact of a $31.5 million impairment of assets designated as held for sale, and net income from the second quarter of 2021 was unusually low due to the negative impact of $39.7 million related to an enacted tax rate change in the United Kingdom. The impact of each of these two unusual events is explained in the Quarterly Report on Form 10-Q filed for each of those quarters.

◦Although the percentage impact of the error correction for these two quarters would be higher than all other reported periods presented (all of which are 3.9% or less), the dollar impact of the change to basic and diluted EPS was only $0.01 and $0.01, respectively, for the second quarter of 2022 and only $0.02 and $0.01, respectively, for the second quarter of 2021.

◦The percentage impact was higher in these quarters because reported GAAP net income from continuing operations was only $2.6 million and $5.5 million, respectively, in these quarters, due to the unusual events mentioned above. However, GAAP net income from continuing operations was not lower than $17.8 million in any other quarter presented, with an average of $40.5 million over the 13 periods discussed and presented in our Prior Response. Our reported annual GAAP net income was $155.9 million and $143.1 million for 2022 and 2021, respectively, which further illustrates that the events in these quarters were unique and not representative of, or impactful to, the trend of earnings.

◦ASC 250-10-45-27, which addresses materiality in the context of interim financial reporting, provides “In considering materiality for the purpose of reporting the correction of an error, amounts shall be related to the estimated income for the full fiscal year and also to the effect on the trend of earnings.” In consideration of this guidance, the impact of this error to annual basic EPS from continuing operations was 2.7% in both 2022 and 2021 and 1.4% and 1.5% to diluted EPS from continuing operations in 2022 and 2021, respectively, which is quantitatively and qualitatively immaterial as discussed in our Prior Response. These two quarters, in

August 14, 2023

Securities and Exchange Commission

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particular, are not representative of historical or expected financial trends of the Company and result from the unique and unusual circumstances described above. Further, the Company does not provide quarterly guidance, a fact that is well known among the Company’s investors. For this reason, the error does not represent information that a reasonable investor would consider to alter the total mix of information available.

•The error does not mask a change in earnings or other trends and does not change a loss into income or vice versa. The error does not impact any revenues, expenses, segment profit, earnings or other financial statement trends.

•The use of the two-class method versus the treasury stock method does not result in any change or modification to the Consolidated Balance Sheet, non-EPS related Consolidated Income Statement information, Consolidated Statement of Shareholders’ Equity, Consolidated Statement of Cash Flows, net income, excluding tax adjustments and other items (non-GAAP), or return on equity, excluding tax adjustments and other items (non-GAAP), for any reporting period.

•The error did not affect management’s compensation, as management is not compensated on EPS.  As described in the Compensation Discussion and Analysis section of the proxy statement for the applicable years, management’s annual performance compensation was and is based on consolidated net income, and management’s long-term incentive plan was and is based on a combination of investment volume and return on equity.

•The error does not hide a failure to meet analysts’ expectations.

◦Management does not provide quarterly earnings guidance or discuss quarterly results in the context of analysts’ estimates. Management regularly states that quarterly EPS can vary dramatically and therefore investors and analysts focus on full-year results.

August 14, 2023

Securities and Exchange Commission

Page 4

◦Management provides annual earnings guidance only, by giving a range of anticipated diluted EPS, excluding tax adjustments and other items (non-GAAP), for the year.  The use of the two-class method versus the treasury stock method would not have caused our reported diluted EPS from continuing operations, excluding tax adjustments and other items (non-GAAP), to fall below the range given, nor would it have impacted whether we exceeded or missed analysts’ consensus estimate for the years shown below:

(Please note that in 2020 the Company suspended guidance as a result of the COVID-19 pandemic.)

 Guidance range1

  Non-GAAP diluted EPS from continuing operations, as reported  Non-GAAP diluted EPS from continuing operations, as corrected  Analysts’ consensus range2

2021 $4.00 - $4.50  $ 5.06    $ 4.99    $4.12 - $4.51

2022 $5.50 - $6.00  $ 6.07    $ 5.99    $5.19 - $5.96

______________________________

1 Management increased guidance in the second quarter of 2021 and 2022. In the second quarter of 2021, guidance was increased from $4.00 - $4.30 to $4.30 - $4.50. In the second quarter of 2022, guidance was increased from $5.50 - $5.80 to $5.60 - $6.00.

2 Analysts update annual estimates throughout the year. The final consensus was $4.51 and $5.96 in 2021 and 2022, respectively.

•EPS trend analysis and an examination of Company guidance provides additional evidence that it is unnecessary to correct  EPS for prior periods. (Refer to Exhibit A for quarterly trends of basic EPS from continuing operations, diluted EPS from continuing operations and diluted EPS from continuing operations, excluding tax adjustments and other items (non-GAAP), as reported and as corrected.) The following table shows the trend of annual diluted EPS from continuing operations, excluding tax adjustments and other items (non-GAAP). A reasonable investor would likely consider this trend analysis unchanged if the 2020-2022 numbers were corrected  for adoption of the two-class method:

 2020  2021  2022

Diluted EPS from continuing operations (Non-GAAP), as reported $ 4.59    $ 5.06    $ 6.07

Diluted EPS from continuing operations (Non-GAAP), as corrected $ 4.48    $ 4.99    $ 5.99

Trend in Earnings y/y: % Change, as reported n/a  10.2  %  20.0  %

Trend in Earnings y/y: % Change, as corrected n/a  11.4  %  20.0  %

Further, the Company’s guidance for full-year 2023 EPS provided at the beginning of the year was $6.50 - $6.90 per share (diluted EPS, excluding tax adjustments and other items, non-GAAP). The Company updated this guidance in our second quarter earnings release and earnings conference call “to be at the upper end of or modestly exceed our previously announced guidance range of $6.50 - $6.90 per diluted share.” When we updated guidance, we considered the impact under both the two-class method and the treasury stock method and our updated guidance is the same under either method. This also represents a positive trend from the reported diluted EPS from continuing operations, excluding tax adjustments and other items (non-GAAP), of  $6.07 in 2022, $5.06 in 2021, and $4.59 in 2020.

August 14, 2023

Securities and Exchange Commission

Page 5

Additionally, investor and analyst behavior consistently highlights that they would consider the error to be immaterial and insignificant. Investors and analysts focus on specific metrics and topics during investor conferences and other communications, and the Company’s coverage analysts focus on these same items in their analyst reports to understand what effect, if any, operating and industry metrics could have on the Company’s full-year guidance.  These items include:

•Segment profit – our internal performance measure to assess the profitability of each segment;

•Investment volume – our internal performance measure, which is predominately composed of acquired railcars and also includes capitalized repairs and improvements to owned railcars and our maintenance facilities;

•Company fleet utilization – the number of railcars on lease to customers divided by the total fleet size;

•Company renewal success rate – the percentage of railcars on expiring leases that are renewed with the existing lessee (the renewal success rate is an important metric because railcars returned by our customers may remain idle or incur additional maintenance and freight costs prior to being leased to new customers);

•Company lease price index – a comparison of the new lease rates to the expiring lease rates for cars renewed;

•Industry trends in market lease rates – an estimate of how current market lease rates compare to the prior quarter, the prior year, and long-term averages;

•Company asset remarketing gains – the gain on sales of existing assets (typically with leases attached);

•Industry strength of the secondary market – an estimate of the overall level of interest from railcar investors in purchasing railcars in the secondary market;

•Class 1 railroad performance – average Class 1 railroad velocity, dwell time, and shipper perception of on-time performance;

•New railcar builder backlog – the number of railcars ordered, but not yet produced, and the amount of time between order and delivery; and

•Industry railcars in storage – the number of industry railcars that have not had a loaded move in the last 60 days.

As further evidence of investor and analyst focal points, we reviewed earnings call transcripts for the 13 quarters presented and there were no questions regarding quarterly EPS comparisons, either versus prior year quarter or sequentially. There were also no questions regarding quarterly EPS results versus consensus estimates.

August 14, 2023

Securities and Exchange Commission

Page 6

Based on the above analysis, the Company has concluded that a correction of the error would not be viewed by a reasonable investor as having  significantly changed the total mix of information available for the periods presented. Therefore, the Company respectfully submits that it is appropriate and fully consistent with U.S. GAAP and the Staff’s guidance on materiality not to correct this immaterial error in prior periods and to present EPS using the two-class method in all future filings, which the Company began doing in its Quarterly Report on Form 10-Q for the quarter ended June 30, 2023.

With regard to your assessment of internal control over financial reporting, explain to us the specific nature and design of the control or controls that you believe had failed regarding this error, and describe in further detail your evaluation of the severity of the control deficiencies and how you considered whether it was reasonably possible that such control deficiencies would fail to prevent or detect a material misstatement.

In this regard, it is unclear how you would be able to support a conclusion that it was not reasonable possible that the control deficiencies that led to the errors could not have resulted in a material misstatement in some future period, considering the scenarios where earnings were unusually low, and the error percentages were significantly higher, as you have shown for the second quarters of 2022 and 2021.

Please note that a material weakness is defined as a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of annual or interim financial statements will not be prevented or detected on a timely basis.

Refer to paragraph A7 of Appendix A to PCAOB Auditing Standards (AS) No. 5.

Description of Control and Control Deficiency

The EPS calculation for each reporting period is prepared and reviewed by the Company’s Financial Reporting team, with appropriate supporting documentation for all numbers included in the EPS calculation, including net income, number of common shares outstanding, and share-based compensation data. Any changes to the share-based compensation structure or any significant changes to the number of shares are presented to management and evaluated in order to determine any potential impacts to the EPS calculation. Annually, a detailed EPS review