How did mergers work? Specifically in the first half of the 20th century 1920-1960 to be exact... if three class Is wanted to merge into one large system what would be the obstacles??? If railroad execs got unions and shippers on board would that help??? I'm kinda trying to write the "history" of my railroad... thanks in advance...
Steve
If everything seems under control, you're not going fast enough!
Mergers and acquistions were controlled by the Interstare Commerce Commision until railroads were deregulated with the Staggers Act of 1980. (ICC was created by Congress in 1887.) .... There were not very many mergers and acquistions before 1980 because of the lengthy and costly process required in order to gain ICC approval. ... After 1980, the companies combined into the large railroads of today.
GARRY
HEARTLAND DIVISION, CB&Q RR
EVERYWHERE LOST; WE HUSTLE OUR CABOOSE FOR YOU
I'm not sure that they'd be considered mergers, but roads like the New York Central or Southern Pacific, for example, were comprised of many smaller roads. And don't forget Penn Central and later, Conrail. The links will take you to brief histories of both, showing some of the early components of both roads
Wayne
NWP SWPIs wanted to merge into one large system what would be the obstacles??? If railroad execs got unions and shippers on board would that help???
The Brotherhoods will want job security but,the ones that have the most say is the shippers/receivers because they want ensured rail service and don't forget other railroads may insist on trackage rights to some Cities and the short lines wants to be ensured their inbound cars will arrive in a timely fashion and empty car request will not go unheeded.
And after that you meet with the Feds and they can ok the merger or axe it for any just concern from the involved States and the shippers/receivers .
Larry
Conductor.
Summerset Ry.
"Stay Alert, Don't get hurt Safety First!"
You can read about real life ones on the internet. Just go to company websites and read about them. Without a "Business Law Degree," your eyes will glaze over after the first paragraph.
Check Wiki for the short and sweet explanations. No two mergers are the same and they fill rooms with documents.
What shape are rocks and how many sizes do they come in is the same kind of question. The devil is in the details and those are extensive in business.
Brent
"All of the world's problems are the result of the difference between how we think and how the world works."
i had read that the Reading had control for a period of time of the New Jersey Central and Lehigh Valley, later loosing it presumablyby simply buying stock in the those RRs. It later became controlled by the B&O for a period of time.
not the same as a merger, but is there much difference?
greg - Philadelphia & Reading / Reading
Heartland Division CB&Q Mergers and acquistions were controlled by the Interstare Commerce Commision until railroads were deregulated with the Staggers Act of 1980. (ICC was created by Congress in 1887.) .... There were not very many mergers and acquistions before 1980 because of the lengthy and costly process required in order to gain ICC approval. ... After 1980, the companies combined into the large railroads of today.
Deregulation didn't really impact the ability to conduct mergers and acquisitions. Staggers was almost entirely over the railroad's ability to set their own freight rates. Mergers and so on would have been outside the ICC's pervue anyhow and been in the SEC's world.
BATMANYou can read about real life ones on the internet. Just go to company websites and read about them. Without a "Business Law Degree," your eyes will glaze over after the first paragraph.
Thankfully Trains Magazine does a good job covering mergers in simple layman's terms.
NWP SWPI'm kinda trying to write the "history" of my railroad.
.
Steven, don't get too hung up on the details when writing your railroad history.
When I was your age I wrote an extensive history of the SRATTON & GILLETTE that I would have thought was the be-all-end-all of the SGRR story.
Back then it was an N scale Appalachian Coal Hauler set in 1968. Oh how things have changed...
Now the only history the SGRR has is "It is a class 1 railroad that runs through this town right here, and by the way, it is August 3rd, 1954."
Your railroad will change. Having a history set in stone will stagnate your creativity.
Be flexible. In 30 years you will have a better handle on what you want to model. Write the detailed/final history then.
At least wait until you have a permanent layout.
-Kevin
Living the dream.
In the old days railroads easily merged small railroads to form larger ones. The Santa Fe was pretty much built by buying out short lines.
From Wikipedia, Northwestern Pacific Railroad history, "The Southern Pacific and Santa Fe entered into a joint agreement in 1906 and merged 42 railroad companies between Marin and Humboldt Bay to create one railroad line stretching from Schellville, California to Eureka."*
* https://en.wikipedia.org/wiki/Northwestern_Pacific_Railroad
SeeYou190 NWP SWP I'm kinda trying to write the "history" of my railroad. Steven, don't get too hung up on the details when writing your railroad history. At least wait until you have a permanent layout. -Kevin
NWP SWP I'm kinda trying to write the "history" of my railroad.
I agree. It seems like getting bogged down in the minutea of a fantasy RR is just one more distraction from working on real physical trains.
More paralysis of analysis. Steven. Write that down in big letters as a mantra to help you and hang it in your room:
STOP PARALYSYS OF ANALYSIS
Better to stop with the new tangents of distraction that have been the plague of the last 6 months and get out there and work on real model trains.
Rio Grande. The Action Road - Focus 1977-1983
Nittanny Lion .... It is true the Staggers Act greatly changed how railroad freight rates are determined. ... The big change was a shift towards contract rates instead of common carrier rates with the railroads previously belonging to groups which controlled interline rates and divisions of revenue for interline shipments.
Regarding mergers and acquisitions, the ICC was responsible for approving applications for them. The process was long and costly. When I worked for CN's GTW, I wrote portions of the applications to the ICC to acquire the DT&I and also to acquire 100% ownership of D&TSL. (GTW previously owned 50% of D&TSL.) . It was quite a chore. It even included an environmnetal impact study to comply with regulations. The DT&I acquisiton was in 1980 following the old ICC rules. Staggers was enacted in 1980 also.
Here is what the US Congress says in its summary of Staggers regarding mergers and acquistions. .... "Sets forth procedures by which the Commission shall approve applications for consolidation, merger, and acquisition of control of and by rail carriers. " ... That is on the summary page. The Act, of course, is a very long document . The ICC was later replaced with the Surface Transportation Board.
NWP SWP How did mergers work? Specifically in the first half of the 20th century 1920-1960 to be exact..
How did mergers work? Specifically in the first half of the 20th century 1920-1960 to be exact..
The railroads would have to figure out what they wanted to do.
They would file an application with the ICC.
Then the other railroads would file comments on the merger, the shippers would file comments on the mergers, the unions would file comments on the mergers.
The ICC would take years and years to hold hearings and reviews etc., etc. etc. and maybe 5-10 years later the merger might be approved, with conditions.
There are two types of mergers, end to end or parallel. An end to end merger is where the railroads touch but don't operate on the same routes. The UP/WP merger was end to end. A parallel merger was where the railroads operate between the same cities. Penn Central was a parallel merger.
End to end mergers are easier than parallel mergers. Parallel merger are generally made to eliminate redundant facilities and routes. Unfortunately with the ICC rules, eliminating those redundant routes was next to impossible. The IC and GM&O merged to form the ICG and ended up with 4 or 5 parallel N-S routes across Mississippi. Unions generally fight parallel mergers tooth and nail because it generally means fewer jobs. Shippers are normally mixed, some fight mergers and some like mergers. Other railroads generally oppose mergers unless they can get something out of it, like trackage rights.
If you think that you got the unions and shippers "on board" that probably means everybody showed up at the meeting in chariots pulled by flying unicorns that traveled across rainbows.
What the railroads did was to buy interest in the other railroads as to assert control without an out right merger. That's why there were "Lines", New York Central Lines, Missouri Pacific Lines. Those were collections of railroads that coordintaed operations but technically hadn't merged.
The UP and CRIP proposed a merger in 1964, but it wasn't approved until 1974 with additonal conditions. By then the economics had chaged so that the merger wasn't as advantageous and the proposal was never enacted. The SP and ATSF attempted a merger but they jumped the gun on assuming it would be approved and it was turned down. The Penn Central merged but they couldn't eliminate unprofitable redundant properties or reduce head count (combined with some really bad management) so by the time they got the properties coordinated, they had lost so much money they went bankrupt.
There are various laws, agreements and legal decisions regarding mergers and protection of employees (New York Dock) that have to be considered.
If your railroads didn't merge for real, there was probably a reason.
Dave H. Painted side goes up. My website : wnbranch.com
On my layout, the Great Northern continued on into the 21st century but was the majority owner of my branch line- The Minnesota, Sioux Lake & Western, which was based in St. Cloud, MN. This bit of alternate fiction allows me to have GN engines appear on the tracks as well as several other railroads, as my Sioux Lake maintenance facility handles repair jobs on an overflow basis from other locations.
You are the author of your railroad's story- it goes in any direction you want it to- that's part of the fun!
Cedarwoodron
For my layout set in the middle 50's with both steam and desiels - I have advanced the merger of C&O, B&O and WM to that time period and any of those could and do run on my Western West Virginian. Along with an occasional visit by the West Virginia Northern, the Buffalo Creek & Gauley, and a stray Pittsburgh & West Virginia loco that continued down the Western Maryland.
dehusmanWhat the railroads did was to buy interest in the other railroads as to assert control without an out right merger. That's why there were "Lines", New York Central Lines, Missouri Pacific Lines. Those were collections of railroads that coordintaed operations but technically hadn't merged.
Well.. All these years as a Model Railroader, and I never knew what "Lines" meant, in fact, I never even thought about it.
Again, this brings up the questions... Just how much don't I know? Everytime I read this forum I find out something else I did not know.
WVWoodmanI have advanced the merger of C&O, B&O and WM to that time period and any of those could and do run on my Western West Virginian.
Sigh..Glad that's in your HO world seeing the C&O,B&O and WM was merged under the CSX banner in '87.First the WM into the B&O then the B&O into the C&O then the C&O into CSX.
State laws also affect mergers. For instance Texas
https://tshaonline.org/handbook/online/articles/eqr01
"When the Texas Legislature passed the Law to Regulate Railroads in 1853, it required that the railroads operating in the state be headquartered in Texas. ... Some, such as the Southern Pacific, Missouri Pacific, and the Santa Fe, retained the corporate names of Texas railroads they had acquired."
The Southern Pacific bought the Texas and New Orleans in 1881 but because of Texas law the railroads were not merged until 1961.
I tried to sell my two cents worth, but no one would give me a plug nickel for it.
I don't have a leg to stand on.
The merger that created Burlington Northern was first attempted c.1905 but was nixed by the ICC. It was attempted several times thereafter, and was refused each time until finally being approved and taking place in 1970.
There were several proposals in the 1930's to "rationalize' the railroads in the NE, but they never came to pass.
The Reading controlled the Lehigh Valley in the late 1800's, it lost it, then the PRR gained control, eventually the B&O gained control of the Reading.
The "robber baron" finaciers of the 1800's controlled vast interlocking groups of railroads, but anti-trust filings ended up splitting them apart. Harriman controlled the UP, SP and IC, but had to divest the UP and IC ater an anti-trust suit against him.
Gould controlled dozens of railroads, the MP, IGN, Wabash, MKT, and DRGW.
wjstix The merger that created Burlington Northern was first attempted c.1905 but was nixed by the ICC. It was attempted several times thereafter, and was refused each time until finally being approved and taking place in 1970.
Originally it was to take place in 1968, but stayed at the last minute. It was so close to implementation that employee time tables had been distributed. I saw one in an antique store once and didn't buy it although I recognized it's significance. I have a privately published book that a retired CB&Q/BN employee did showing his train order collection. It has the train order announcing the new BN time table taking effect and the train order annulling that order and stating the current CB&Q time table remaining in effect.
Jeff
One thing I remember Norm Lorentzen (one-time BN President / CEO) saying was that the best thing that happened with the BN merger is that it was delayed two years, from 1968 to 1970. He said those two years gave them time to work out a lot of potential problems, and because of that, the merger ended up being much smoother. BTW in 1967 it seemed so likely the merger would be squashed again that Great Northern went ahead with introducing the "Big Sky Blue" paint scheme, repainting green and orange GN diesels into sky blue, white and gray...a paint scheme many engines only wore a few years before being repainted for BN.
Not sure how many times the GN-NP-CBQ-SPS merger was proposed and rejected. I know the first was during the T. Roosevelt administration, early 1900's, then again around 1927, 1949, and I think about 1960.
Of course the Burlington and SP&S were already co-owned by NP and GN, so that made that merger smoother, as did the fact that NP and GN had been connected going back to James J. Hill's time, with interlocking boards and such.
When a merger would go into effect and locomotives were repainted, how long after might one typically enounter freight cars still carrying the names of the predecessor railroads? Years?
ICG reverted to being just Illinois Central at the beginning of 1989. NO freight car repaints after that time were painted orange. Yet even now I frequently see orange ICG bulkhead flat cars passing through Enola Yard carrying new slabs of granite. So that is 28 plus years after the end of ICG that they are still out there in revenue service. I have seen Santa Fe red warbonnet engines occasionally still NOT patch lettered BNSF in recent years, also. However they are rare now.
Shock Control When a merger would go into effect and locomotives were repainted, how long after might one typically encounter freight cars still carrying the names of the predecessor railroads? Years?
When a merger would go into effect and locomotives were repainted, how long after might one typically encounter freight cars still carrying the names of the predecessor railroads? Years?
There was SCL,C&O,B&O,WM,Family Lines,Clinchfield,Chessie,Seaboard System locomotives well into the 90s with a patched CSX in the cab.
You can still see Family Lines,Chessie and Seaboard System covered hoppers with patched CSX markings.
So basically it was impractical to merge in the early 20th century?
A mega merger wouldn't really work in the depression era, right? Even if unions and shippers were satisfied?
I like this topic, very educational. Some time ago, I read the history of the Norfolk and Western, prior to becoming Norfolk Southern. The N & W took over many railroads in their history, but I don't think they were mergers.
There were no mergers, but take the PRR for instance, they had controlling interest in a lot of railroads, the N&W, Wabash, DT&I, LV and many other smaller roads. There is a chart in the book Wreck of the Penn Central that lists all of them. As part of the merger with the NYC they had to divest themselves of many of these railroads, which is why the N&W and NKP merger came about (along with the leasing of the Wabash), and that forced the AnnArbor out of the Wabash into the hands of the DT&I.
A pre 1960 Merger was the M&StL into the C&NW which was a very convulted situation with the old president of the M&StL becoming the president of the C&NW and he forced the merger, much of the M&StL was abandoned as it paralleled the C&NW.
Rick Jesionowski
Rule 1: This is my railroad.
Rule 2: I make the rules.
Rule 3: Illuminating discussion of prototype history, equipment and operating practices is always welcome, but in the event of visitor-perceived anacronisms, detail descrepancies or operating errors, consult RULE 1!
Shock Control When a merger would go into effect and locomotives were repainted, how long after might one typically enounter freight cars still carrying the names of the predecessor railroads? Years?
I keep hearing about the C&O/B&O "merger" how did that one work?