This evening I was studying a route map of the Chicago Great Western Railway for the first time.
From looking at the map, I was struck by how beautifully the CGW knit together some of the most important cities in the Midwest: Chicago, Omaha, Minneapolis-St. Paul, and Kansas City. (See the map below.)
According to the Wikipedia entry on the CGW, the railroad was a very efficient operation. It was also rid of its passenger trains by 1962. Those are two very big pluses for a 1960's-era railroad in my mind.
For whatever reason, the CGW merged with the Chicago & Northwestern in 1968.
Naturally, I wonder: Was a merger really necessary? And could it have survived without merging?
A related question: Could it be a viable regional railroad today?
The Wikipedia entry says that the directors felt it had to merge in the 1960's or else perish. But I wonder if that was true or just a perception; did the financials really bear that conclusion out? Here is the Wikipedia quote:
Upon the failure of a merger opportunity with the Soo Line Railroad in 1963, the board of the Great Western grew increasingly anxious about its continued viability in a consolidating railroad market. Testifying before the Interstate Commerce Commission in Chicago, President Reidy claimed, "The simple fact is that there is just too much transportation available between the principal cities we serve. The Great Western cannot long survive as an independent carrier under these conditions."The CGW, therefore, was open to a merger with the Chicago and North Western Railway (CNW), first proposed in 1964. After a 4-year period of opposition by other competing railroads, on July 1, 1968, the Chicago Great Western merged with Chicago and North Western.
__________
Chicago Great Western system map:
CGW, 2-10-4, Texas type locomotive:
CGW trestle. Fort Dodge, IA
- Rails West
I just noticed an earlier discussion from 2008 with some relevant commentary.
Go to thread: Ex-CGW trackage in the 70's
I also noticed this book on the CGW: The Corn Belt Route: A History of the Chicago Great Western Railroad Company, by H. Roger Grant.
Thanks.
Consider the competition. Chicago-Omaha-C&NW, MILW, CB&Q, ROCK, IC. The UP solicited for the C&NW route and sent traffic without shipper specified routing the same way.
Chicago-Minneapolis-C&NW, SOO?, CB&Q, MILW.
Chicago-Kansas City, MILW, Rock Island and (the 800 pound gorilla in the room) Santa Fe.
As noted in the previous thread you linked, by the 1960's the CGW was generally running only one daily through freight and local trains providing no more than one daily stop at on line businesses. As noted by MP173, they reported an OK profit in the last full year of operation, but one can infer from the train speeds and the power-FT's- used on the through freight trains, they were probably looking at huge needs for capital expenditures that couldn't be supported by the cash flow.
I suspect that the board looked at the capex needs and the general downward trends for rail freight traffic of the era and concluded that the sale/merger was going to produce the best result for stock and bond holders.
"We have met the enemy and he is us." Pogo Possum "We have met the anemone... and he is Russ." Bucky Katt "Prediction is very difficult, especially if it's about the future." Niels Bohr, Nobel laureate in physics
jeatonChicago-Minneapolis - C&NW, SOO?, CB&Q, MILW.
The SOO did have a line from Chicago to Minneapolis. I have no idea how good it was, though.
Soo System map
It's interesting that the CGW tried to merge with the SOO. There was no duplicate trackage between the two roads except the Chicago to Minneapolis routes. The two roads served totally different regions. So that would have created a new system with impressive reach -- from Winnipeg to Kansas City.
The CGW and the C&NW, on the other hand, went to all the same places. So the 1968 merger with the C&NW apparently was just a move to consolidate competition.
C&NW system map
I imagine the SOO merger was regarded as somewhat risky. But the system map of a merged CGW/SOO is intriguing.
Interesting to study the CGW map shown above. You will note that the "800 pound gorilla" (Santa Fe between Chicago and Kansas City) does not even show up on their map. Those who are informed acknowledge that Santa Fe was, and BNSF is, the dominate carrier between these cities because of its direct route, and because that segement has been maintained and improved through the years since it was created in the late 1880's.
To take this on another tangent. There was serious talks between the SOO ,CGW and the Katy about traffic routing betwwen the Twin Cities and Texas coast. Had the that taken place then Niether railroad would have been taken over by anyone, The Three of them together would have proved too strong and would all would still be independant
The CGW routes were not all that great. The Twin Cities-Chicago routing had too many miles, and the only real connection in Chicago was the IHB. The CGW had lots of 'terminal' issues as they many times were the last line built. The KC line was very poorly constructed, and had terrible connections via the MP to get into town - lots of delays. The Twin Cities-Omaha line via the Hayfield cutoff actually was shorter than the Northwestern's 'Omaha West' route - but traffic between those terminals has always been meager.
The CGW traffic through the 50's was based on lots of 'meat' business, and local on-line business. Like most roads, that local business dried up by the 60's(trucking), and the meat packing business model went from large integrated plants to smaller regional plants that shipped basically in their state and produced 'boxed' meats. The shipment of hanging sides of beef in reefers was gone, and by 1965 - those strings of Swift/Armour reefers on the head end of the Southbound time freight out of South St Paul were gone.
The failed SOO-CGW merger of 1962 left the CGW with few options. The CNW-CGW merger was just part of the overall CNW plan to combine the best parts of several Grainger roads. The CGW diesel fleet was actually in pretty good shape - the large fleet of freight F's were being supplanted by GP30 & SD40 purchases in the 60's.
Would a SOO-CGW merger 'worked'? The routing looked good, but the Rock Island 'Spine Line' was better, and the Rock Island and the SOO worked together on Twin Cities terminal transfer operations(Rocky-Soo Transfers) as soon as the CNW-CGW merger took place. By 1970, the BN merger took place and the entire 'connections' map out of the Twin Cities had to be re-thought.
Jim
Modeling BNSF and Milwaukee Road in SW Wisconsin
A question that begs asking: What if the CGW merged with the SOO and did survive? If that happened, could possibly another route have been abandoned that is now currently in use?
Great contributions, everyone.
I like that giant wye in the middle of the system (Oelwein - Clarion - Austin). At least on paper, the CGW makes a good-looking system.
I'm still asking myself, could the CGW have survived without a merger? There are definitely small midwestern roads that are viable, like the Iowa Northern today. So, I am thinking, "maybe".
Searching the web, I found some interesting commentary on other forums:
"Chicago Great Western was a very well run and efficient railroad, often overlooked! It's too bad it was absorbed into C&NW, which pretty much dismantled nearly everything CGW. I always thought a hookup with KCS or Santa Fe would have been better for shippers and the general public. CGW service was slow, but reliable as many of their shippers often commented on. C&NW brought changes that ultimately brought service reductions and outright elimination."
"An end-point merger with the Santa Fe would have probably been the best, allowing Santa Fe direct access to the upper Midwest. MKT was still too weak at the time (1967) to be much of a force. KCS presented an ideal candidate and in fact was under Deramus control at the time."
(posted by atsf3751 here)
Now, that is what you call a "locomotive" a beauty to behold.
tatansNow, that is what you call a "locomotive".
I recall reading somewhere that CGW selected the 2-10-4 type engine because of its large firebox, which made it possible to get a train over grades without helpers. The CGW owned 36 of the 2-10-4 type: http://www.steamlocomotive.com/texas/?page=cgw
Bill Warrick produced a video several years ago entitled, "The Granger Roads" which featured some film clips and information about the Chicago Great Western and its competitors, that was aired on RFD-TV.
The main problem mentioned is that there were too many parallel railroads competing for too few customers. Lines mentioned in the video as being in direct competition with the CGW are the Santa Fe, Burlington Route, and Rock Island.
As a result of farmer complaints about alleged price fixing among the railroads, Granger Laws were passed by each state, and these laws eventually resulted in creation of the Interstate Commerce Commission.
One rail historian says in the video that at that time it was impossible to travel for 12 miles in any direction in the state of Iowa without encountering a railroad line.
In my view, the CGW's survival as an independent would have required a substantial infusion of capital. It appears that would have required someone with deep pockets,an extremely high tolerance for risk and a lot of patience. Even though the railroad was turning a profit, just "sticking is out" probably would have found it suffering the same fate as the Rock Island, only much sooner. In terms of physical condition, it appears to have been the worst of the competing lines. Keep in mind that over the subsequent decades, the Milwaukee Road's Omaha Line was abandoned, and both the IC's Iowa line and the Rock Island's Chicago-Omaha line were hanging by some very thin threads. While I concede that the latter two under their respective ownerhips of CN and Iowa Interstate seem to be doing OK, I doubt that their market share is 10% of the total movement in the Chicago-Omaha corridor.
In today's world, a intact CGW may have found itself serving grain unit tran shippers, ethanol plants and possibly a coal fired power pant or two, and could be riding the current big wave of rail business. But then, maybe not. Even if forseen, from 1966 it would be decades before these big new markets would come to pass. That is a long time burning up cash.
Excerpt from Engineering-Contracting (1909)
The mandate has gone forth that no longer shall Chicago Great Western R.R. be known as the "Maple Leaf Route,'' and the emblem, the maple leaf, used for the past 15 years by this road, is disappearing from the letter heads and stationery of the company. It will also be seen no more on the box cars of the company. When the road was first organized, its owners and promoters intended to call it the Great Western, but another road, which was never built, had already been chartered under that name. The new road, however, absorbed the right of way and other property of the older road, but the charter still remained, and the nearest the owners could come was to call it the Chicago Great Western. The first emblem or nickname of the road was secured back in the latter part of the 80's, when all the engine smokestacks were painted red, and this practice, taken in connection with the old fashioned funnel shaped stacks, was such a novelty that for several years the Chicago Great Western was known as the "Red Smokestack" road. When the old funnel shaped stacks were abandoned the company discontinued painting the stacks red and set about to secure a new nickname. About 15 years ago the company inaugurated a contest, offering a prize of $1,000 for the best emblem suggested. This prize was won by a traffic department employee, who submitted the maple leaf. The idea of the maple leaf was derived from the fact that the physical makeup of the Great Western at that time was such that a map placed on a maple leaf would show the different lines as ribs of the leaf. The suggestion once adopted met with favor, and a yellow leaf with a map of the system was painted on each box car and on all other property of the Chicago Great Western the maple leaf was placed.
Excerpt from Railway Journal (1910)
The Chicago Great Western is known no more as the "Maple Leaf Route." After many years it has decided to change its nickname to something that is more suggestive of commerce and relative to the country through which it passes. To be sure, there are thousands of maple trees in its extensive territory, but a maple leaf is not productive of traffic. The road is now the "Corn Belt Route," which is certainly appropriate, for the road traverses the great corn states of Illinois, Iowa, Missouri and Minnesota, touching the great corn and produce markets of Kansas City, St. Joseph, Omaha, Minneapolis, St. Paul and Chicago....The present trademark is in the shape of a circle, around the outer border of which is a row of ears of corn, and inside this is another circle bearing the three words - Chicago Great Western. Stretching across the whole trademark is a banner on which is the new nickname - Corn Belt Route. It has come to stay, no doubt.
[/quote]
With enough "ifs," you can make anything work as a mental exercise. If CGW had somehow persevered through the ’70s, then perhaps nobody would have picked up Rock's Iowa lines due to the additional competition, and then perhaps the traffic that's developed of late on Iowa Northern and Iowa Interstate would instead be running on CGW. How CGW would have survived the ’70s, then the ’80s, then the ’90s, that's hard for me to envision.
On the question of through traffic, I have difficulty envisioning anybody using CGW to get anywhere important. The BN merger put the Hill Lines traffic from the Twin Cities onto the CB&Q to get to Chicago. UP had agreements with North Western and Milwaukee to get traffic from Omaha to Chicago. SP got their own route into Chicago from KC in the early ’90s. Perhaps the biggest blow: Staggers, which ended the practice of splitting traffic up and sprinkling it among connections.
I'm just not sure these counterfactuals prove much of anything. CGW had major weaknesses, as Jim has pointed out, that made it poorly able to compete. The changing railroad environment forced the railroads to find a partner before the music stopped. Long-term traffic patterns in the Midwest were never going to justify the number of routes that existed. Something had to give. CGW gave. If it hadn't, somebody else would have. But I suspect CGW's weaknesses would have caused it to give out before others, even if it hadn't merged with C&NW when it did.
Thanks for that reply, Andy.
(I made some edits to this post after re-reading your post.)
Yes, if CGW could have survived 20 or 30 years longer, then I think it would be doing well today, with business in the wind power industry, easements for transmission lines, ethanol, corn and soy. I am thinking we might see some abandoned CGW lines put back into use again to capture some of that business. I hope so.
Merging with with CGW gave the CNW access to Kanas City. When the CNW got the Rock Island's Spine Line in the 1980's, the CGW route to Kansas City was abandon.
If not for access to Kansas City, would the CNW have merged with the CGW?
To add to the 'What If's', with the talk of the CGW merging with the SOO or surviving on its own into the post-Staggers era, was there any talk of the CGW merging with a eastern road? I would think the CGW would fit nicely in today's CSX system, mostly for the Chicago to Minneapolis line. The CGW used B&O (now CSX) trackage rights to access Chicago from Forest Park. Maybe I'm wrong, but I would think the CGW trackage would be attractive to an eastern line wanting to extend their reach westward, particularly for intermodal business. The obstacle I see however is the low clearance, high maintenance, Winston Tunnel near Galena, IL, which was a major financial burden for the CGW. I guess we will never know.
Jeff
To survive as an independent they would have to almost totally rely on originating/terminating traffic. The consolidation of the surrounding players would've (and did) dry up bridge traffic. (The CN and IAIS have very little, if any bridge traffic between Chicago and Council Bluffs.) Maybe if deregulation would've occurred sooner and they could've achieved the productivity gains (reduced crews, elimination of agents/clerks, etc.) it might have been possible for them to survive to this day.
Still, a lot of the business they had isn't there anymore. Not just lost to trucks, but gone completely. Railroads aren't the only industries to have gone thru changes in the last 40+ years. Is what's left (and what may have been left on lines the CNW abandoned) enough or is it too few and too far?
I think if they had stayed independent and survived to this day, the map of today would not look like the map of 1968.
Their awkward KC connection notwithstanding, the CGW couldn't have remained competitive using their original Chicago route. As has been discussed, the Winston Tunnel was a maintenance nightmare and they had expensive IC trackage rights to cross the Mississippi. But also, the CGW had a horrible grade climb westward out of Dubuque. To remain competitive, they would have had to lose that whole Dubuque gauntlet. There were ideas to bypass Dubuque via Farley-Elizabeth with a new Mississippi high bridge, but that was nothing more than a prohibitively expensive idea. Even if they had built a Dubuque bypass (without the whole project sinking the company,) I can't envision even that being advantageous enough.
I still think it's a shame that more of the former CGW didn't survive after being gobbled up by CNW. Back in the late 70's the story I heard is that ICG offered CNW $1 for the segment from Dyersville out to Floyd's Feed Store (just south of Petersburg). They were still getting serviced by CNW as late as 1979. I often wonder if Jack Haley had come along and purchased ICG's Iowa Division, say, back in 1978 or 1979 he might have taken some of the CGW as well; particularly the line from Waterloo down to Kansas City.
It just wasnt a very good railroad.
I have Chicago Great Western In Color by Lloyd E. Stagner and will review it again this week plus take a look at their financials in the Moodys...but they didnt do anything that Burlington didnt do...and it took them 2x to get there.
Let's see:
1. Lousy Chicago terminal with very little originating traffic ability.
2. Tunnel in western Il that was a nightmare (Winston Tunnel).
3. Dubuque crossing of the Mississippi that was tough, including trackage rights.
4. Slow routes to Mpls, Omaha, and KC
The management squeezed as much as they could by running one big train per day over each route (correct me if I am wrong).
One must ask the question...what did CNW see in CGW to purchase it?
Was it simply a buy out to get rid of a competitor?Ed
As one who has studied this situation for several years, and reading all the comments about it in various forums etc, the biggest reason the CGW went under is the smae reason the Penn Central went under and several other roads. Over regulation by the government. Yes bad management decisions and union stubborns added to it, but when any business is prevented from being able to cover their costs by the government bankruptcy is almost certain especially for the more marginal ones.
MP173 It just wasnt a very good railroad. I have Chicago Great Western In Color by Lloyd E. Stagner and will review it again this week plus take a look at their financials in the Moodys...but they didnt do anything that Burlington didnt do...and it took them 2x to get there. Let's see: 1. Lousy Chicago terminal with very little originating traffic ability. 2. Tunnel in western Il that was a nightmare (Winston Tunnel). 3. Dubuque crossing of the Mississippi that was tough, including trackage rights. 4. Slow routes to Mpls, Omaha, and KC The management squeezed as much as they could by running one big train per day over each route (correct me if I am wrong). One must ask the question...what did CNW see in CGW to purchase it? Was it simply a buy out to get rid of a competitor?Ed
The Chicago to Oelwein line seen two large trains a day in each direction just before the merger plus I think a local or two on the east end towards Chicago. There was also an occasional meat extra. I don't know about the other lines; I'm guessing a similar train frequency.
From what I've gathered, the CNW only wanted the Marshalltown to KC portion of the CGW to access KC and also to rid itself from competition. Of course purchasing the RI spine line eliminated the need for the CGW trackage.
CGW followed the Deramus operating philosophy of minimum trains/maximum tonnage, leading to a situation of one or two heavy trains daily on each line. This operating practice continued on KCS into the late 70's/early 80's and may have been the practice on MKT prior to John W. Barriger.
I've often wondered the same about the Virginian Railway (VGN). It was the most efficient coal hauler in the country during its time. It had the smallest grades from Norfolk to Kenova WV than any other such tidewater hauler.Again, for whatever reason, the VGN merged with the Norfolk & Western in 1959 and to this day there is not a single heritage locomotive for the VGN in Norfolk Southern's stable or anything from which to remember the VGN; N&W even stopped used the low grade routes (over 80%).
Naturally, I also wonder: Was a merger really necessary? And could the VGN have survived without merging?
My grandfather was an engineer for 30+ years on the VGN and there are so many knowledgeable railroaders on this site, I would love to hear from some of you.
VGN JessI've often wondered the same about the Virginian Railway (VGN). It was the most efficient coal hauler in the country during its time. It had the smallest grades from Norfolk to Kenova WV than any other such tidewater hauler...My grandfather was an engineer for 30+ years on the VGN and there are so many knowledgeable railroaders on this site, I would love to hear from some of you.
RE: Virginian Railway
I just did a bit of reading on-line, and the VGN sounds like it was a very profitable operation, and highly sought after by the C&O and the N&W. You ought to start a brand new thread on it. I'd love to learn more about it!
Well, I've learned so far that the CGW was doing good business to the end. If I understand correctly (from reading the 2008 thread linked above), it ran four, very long scheduled freights daily across Illinois, plus extra "meat" trains from Omaha up until the end of operations. The railroad was making money, and it had a very good debt-to-equity ratio of 20% (which, by the way, was much better than the C&NW's of 52%). That all sounds pretty good to me. And that's why I can't just accept everyone's assumption that it was a "weak railroad" that needed to merge to survive. Until I read something rigorous, my mind is open.
To Rails West:
I also studied the CGW route map in the Rand McNally Railroad Atlas and thought it looked pretty good; and like another writer, computed mileages on both the CNW (ex-CMO) and CGW lines between the Twin Cities and Omaha (I wondered why the CNW didn't route more trains that way with the mileage advantage (although it wasn't that much shorter)).
This was in the early 1970s after the CNW-CGW merger and I was regretting the loss of an interesting, but largely unknown to me, railroad that operated in the Twin Cities. I used to see CGW Baldwin switchers in action near my high school and I thought the red-and-scheme was pretty sharp (I still do!).
My real education about the CGW began after I started work in 1978 at CNW's Twin Cities Division Engineering Department in St. Paul. We had charge of the ex-CGW line from South St. Paul south to Randolph, plus what remained of branch lines to Mankato and Red Wing (both laid with 75 lb. rail).
Of course, we had maps, grade profiles, records, etc. for that area, plus we had a collection of track charts (called condensed profiles by some railroads) for other CNW divisons that covered most of the remainder (except east of Dubuque which had been abandoned already).
After study, it became painfully obvious what a poor grade profile the CGW actually had; it was had to find any CGW line with a profile that DIDN'T resemble a coarse-toothed saw blade. One ex-CGW mechanical department employee who had worked at Hayfield, Minn. said that the CGW had a Car Dept. repair truck accompanying those long, "money-making" trains to repair the numerous broken knuckles and pulled drawbars encountered enroute.
The grades on both sides of Dubuque and the infamous Winston Tunnel have been mentioned by others; the tunnel was a major headache with unstable rock and constant groundwater infiltration.
As bad as the Chicago line was, the Kansas City line was even worse: south of Des Moines was mile after mile of up-and-down-and-curves through the hilly topography of southern Iowa and northern Missouri, with lots of 90 lb. jointed rail, and sidings short and too far apart. Oh yes, mostly dark territory to boot.
At St Joe the CGW emerged from the hills, served a few minor industries on the north end of town, then fought through town via trackage rights on at least two railroads (I don't have a timetable to double check, it might have even been three railroads); this was all on glorified yard trackage with hand throw switches and slow running. South of town, while the CB&Q, ATSF, RI, and MP all followed the east bank of the Missouri River on their way south, the Great Western struck off into the hills again, emerging opposite Leavenworth, Kansas. Here they crossed the Missouri River on an ancient, light-axle-loading bridge; on the Kansas side they made a 90 degree bend on an ultra sharp curve (so sharp it had a guardrail on the inside rail) to connect with the MP's Omaha-Kansas City line.
CGW trains had a nice run on the CTC-equipped MP line the rest of the way to KC, but of course they paid well for the privilege (and served no industries either). Arriving at Kansas City, the CGW peeled off the MP on another tightly curved connection and entered their yard located in the West Bottoms area of KC. The small yard was hemmed in on the north by an elevated highway, the MP main line, and the Missouri River. On the south side of the yard was a KCS yard (which the CNW later acquired for extra capacity). Although the West Bottoms area is filled with industry, the CGW only served two or three industries at best; virtually all traffic was from connecting railroads.
My boss in the St. Paul engineering office had worked on the Iowa Division (which had jurisdiction on the ex-CGW Marshalltown-Kansas City line) during the early 1970s; he said the North Western was throwing every dollar it could find into fixing up the KC line, they put in a lot of secondhand CWR, plus ties and ballast, but there was a lot of bad track to fix up and I don't recall that the line was ever completely upgraded.
The real crunch came during the big Russian grain sale in 1973-74; North Western was trying to push numerous loaded grain trains south for Gulf Coast destinations, plus get the empties back north, and handle the regular trains besides. Gene Lewis (a former CNW official) described the chaos in his book "12,000 Days on the North Western Line" and in an article he wrote for "North Western Lines" (the C&NW Historical Society's magazine).
It got so bad the CNW started running "detour" trains on the RI line; they tried to run as many on the Rock as they possibly could. The RI didn't mind: trains operated as detours are charged pre-determined General Managers Association rates that favor the host railroad (in other words, they're money makers). All would have been fine except the ICC got wind of what was going on and forced the CNW to end the "detours."
After the North Western acquired the Rock South St. Paul-Kansas City "Spine Line" plus the Iowa grain lines the ex-CGW didn't last long; just long enough to fix up the ex-Rock trackage and then everything was promptly pulled off the CGW except a wayfreight (they never considered any directional running using both lines once the Rock trackwork was finished). I don't have abandonment dates but I recall it went quickly.
Time for bed! Tomorrow I'll tell about the "islands," what the Great Western REALLY had for traffic sources, and the truth about that "great" Twin Cities-Omaha line.
Kurt Hayek
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