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Trains Magazine 1965 December Schenectady's survival story 4th diesel issue RI
Trains Magazine 1965 December
December 1965Volume 26 Number 2
NEWS -
DIESEL NEWS PHOTOS -10
RAILROAD NEWS PHOTOS12
OUR GM SCRAPBOOK - 720
CHRISTINE, THE MONGEESE28
HOW TO SURVIVE IN THE DIESEL BIZ --40
Railway post office 54Running extra 56
Second section56Interchange57
COVER: ACL Alco Century 630 2011; MILW EMD GP30's (A. Kamm); RI EMD E3-A 625 (L. Marre).
TROUBLE ON THE PRAIRIE
LESS than a decade ago the shrewdest analysts on Wall Street couldn't say enough for Rock Island. Which was by way of personally complimenting the late John D. Farrington, the handsome Burlington-trained operating man who had pulled the big granger out of its second bankruptcy of the century and, in the process, had shaken up such once complacent rivals as Santa Fe and his alma mater. Under Farring-ton's guidance, RI became the razzle-dazzle operator of the prairies, indulging in such phenomena as line relocations and double-track C.T.C. and buying America's first 44-tonner, road-switcher, and low center-of-gravity streamliner. In the process he got his operating ratio way below the Class 1 road average and, after reorganization, pushed dividends up to $5 a share on stock that was subsequently split 2 for 1. Farrington did such a good job, in fact, that rail observers crossed Rock Island off their worry lists along with D&RGW and Seaboard and all the other back-from-the-dead depression casualties.
Then, for causes nobody has been able to satisfactorily explain, the Rock began to slide. From 18.7 million dollars in 1956, its net income slid to 6 million by 1960 and wound up at 3.8 million in 1964. This year the road is expected to lose close to 5 million dollars. It is true that Rock Island is a granger and therefore more vulnerable than most to the variables of crops, that it is burdened with commuters, and that everywhere it operates it is bracketed by competition, notably that of the Q. But it is also true that a host of other roads have lived with these odds since the war without coming apart at the seams. RI's gross has actually held remarkably steady for the past 10 years at or above the 200-million-dollar mark per annum. The trouble is that its operating ratio has climbed steadily in the interim - from a postwar low of 70.8 per cent in 1953 to 81.6 per cent last year.
By the time the directors imported Jervis Langdon Jr. from the B&O to put their railroad back together, the Rock was very much the Erie Lackawanna of the prairies. Langdon took one look at RI's I.C.C. formula passenger loss of 15 million dollars a year, shuddered, and defused all of the Rockets of their sleepers and diners. He also began trading in a weary if exotic diesel fleet [see pages 28-39] on new GP35's and U25B's, as well as buying more than 4200 freight cars. And, round the clock, he kept preaching that the ultimate salvation of the railroad lay in merger with Union Pacific.
And if there's one subject that has provoked more argument than Rock Is
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