Eastern Railroad Discussion > Conrail

When Conrail was formed from the weak northeast railroads, was there a corporate culture of one of the ralroads that simply morphed into Conrail? If so, which was it or did the creation bring in a lot of new and fresh faces to fashion its own corporate identity?

If for no other reason than sheer size, I would say that middle and some upper management was dominated by former Penn Central people. Of course then you could argue whether they were PRR or NYC people. Dick Hasselman was one of the senior carryover guys, and he was a NYC/PC man. Of course Jordan, the number one man was not a railroader at all.

Posted from iPhone

I'll attempt a reply to maybe get some discussion going. I was not a Conrail employee but dealt  with them in mechanical and customer service issues and was involved with Conrail and "ex-Cons" in engineering projects on former Conrail lines that were sold off. Also I was a railfan with close contact with Conrail operating people at Mohawk-Hudson Division headquarters at Utica right up to the Superintendent level.

Although to many of us at the time associated with "other than ex PC lines", such as the Erie Lackawanna, felt it was just one bigger Penn Central circus with blue paint, that is a bit unfair. Conrail in many ways seemed to focus on building "best practice" based truly on best practices of the roads that folded into it or went to a new a better standard completely.  I don't know if that originated with Ed Jordan or Dick Spence or what, but it started early on. An example would be in signals; signal systems and grade crossing signals. There were some fresh thoughts and clean sheets of paper and some well thought out standards with new people brought in. Mechanical seemed to have a heavy Reading RR influence but one that was not a Reading plan cookie cutter either. Operations and operational rules seemed to go the Penn Central way which I think PC largely adopted from PRR. As CR aged they went into other directions as NORAC came into being creating standardizations among many regional carriers as related to operating rules. I've heard that Conrail's engineering standards in general where well thought out and many were fresh clean sheets of paper rather than changing the logo on the previous document standard, but I don't have enough experience with that other than signals to speak further of it.

I think certainly it became its own culture although for many years, and maybe right up until the end, there were still the "us" and "them" among the individual employees. Working mechanical projects it was always useful to know which former road someone came off in order to relate to them and get the job done. I would approach a former PRR guy different than a NYC guy.* (*many of the senior managers and officials into the early 90's were of the pre PC era, or if former EL were DL&W or Erie folks). 

I think they managed to blend all the roads that went into Conrail better than PC made out in combining the NYC with PRR, and Conrail was certainly its own cultural entity.

 



Edited 2 time(s). Last edit at 09/15/23 08:00 by train1275.

train1275 Wrote:
-------------------------------------------------------
> I'll attempt a reply to maybe get some discussion
> going. I was not a Conrail employee but dealt 
> with them in mechanical and customer service
> issues and was involved with Conrail and "ex-Cons"
> in engineering projects on former Conrail lines
> that were sold off. Also I was a railfan with
> close contact with Conrail operating people at
> Mohawk-Hudson Division headquarters at Utica right
> up to the Superintendent level.
>
> Although to many of us at the time associated with
> "other than ex PC lines", such as the Erie
> Lackawanna, felt it was just one bigger Penn
> Central circus with blue paint, that is a bit
> unfair. Conrail in many ways seemed to focus on
> building "best practice" based truly on best
> practices of the roads that folded into it or went
> to a new a better standard completely.  I don't
> know if that originated with Ed Jordan or Dick
> Spence or what, but it started early on. An
> example would be in signals; signal systems and
> grade crossing signals. There were some fresh
> thoughts and clean sheets of paper and some well
> thought out standards with new people brought in.
> Mechanical seemed to have a heavy Reading RR
> influence but one that was not a Reading plan
> cookie cutter either. Operations and operational
> rules seemed to go the Penn Central way which I
> think PC largely adopted from PRR. As CR aged they
> went into other directions as NORAC came into
> being creating standardizations among many
> regional carriers as related to operating rules.
> I've heard that Conrail's engineering standards in
> general where well thought out and many were fresh
> clean sheets of paper rather than changing the
> logo on the previous document standard, but I
> don't have enough experience with that other than
> signals to speak further of it.
>
> I think certainly it became its own culture
> although for many years, and maybe right up until
> the end, there were still the "us" and "them"
> among the individual employees. Working mechanical
> projects it was always useful to know which former
> road someone came off in order to relate to them
> and get the job done. I would approach a former
> PRR guy different than a NYC guy.* (*many of the
> senior managers and officials into the early 90's
> were of the pre PC era, or if former EL were DL&W
> or Erie folks). 
>
> I think they managed to blend all the roads that
> went into Conrail better than PC made out in
> combining the NYC with PRR, and Conrail was
> certainly its own cultural entity.
>
>  

If there was better integration I guess it was a do it or die attitude, as I reckon that's where they were at that time. 

The idea of creating a big "X" was innovative for the time. NYC area to Chicago, Boston area to St Louis.  Two major lines, resulting in an X at their crossing.  Prune off the redundant lines, etc which weren't contributing to the business flow.  Many short lines were spun off, some survived.

 Conrail paid back all the Federal bailout money--with interest--then became so profitable that CSX and NS got into a food fight over it.

Sad to see the fallen flags go, of course (less PC), but Conrail turned out to be so successful that it needed to be carved up. 

It saved Northeastern railroading, and did so in spectacular fashion. That's its legacy.

Art House

aehouse Wrote:
-------------------------------------------------------
>  Conrail paid back all the Federal bailout
> money--with interest--then became so profitable
> that CSX and NS got into a food fight over it.
>
> Sad to see the fallen flags go, of course (less
> PC), but Conrail turned out to be so successful
> that it needed to be carved up. 
>
> It saved Northeastern railroading, and did so in
> spectacular fashion. That's its legacy.
>
> Art House

Yes, it did. So much redundancy and lightly used branch lines were cast off by the dozens. Concentration on the core lines perhaps was the precursor to what we see today with PSR, and trimming all customers that aren't profitable enough.
Perhaps changes in regulation missed additional opportunities to save more railroad lines. Perhaps it is too difficult to maintain sidings and branch lines that are marginal shippers, although the case could be made that it is better for freight to move over the railroads than on the highways. A lot more could have been done, but undoubtedly Conrail was a government program that worked out well to save NE railroads

Posted from Android

Canadian Pacific is a Canadian company. It and CN are considered national strategic assets, and they will Not be sold to outsiders.

The Canadian government played that card with Potash as well.

Posted from Android

aehouse Wrote:
-------------------------------------------------------
>  Conrail paid back all the Federal bailout
> money--with interest--then became so profitable
> that CSX and NS got into a food fight over it.
>
> Sad to see the fallen flags go, of course (less
> PC), but Conrail turned out to be so successful
> that it needed to be carved up. 
>
> It saved Northeastern railroading, and did so in
> spectacular fashion. That's its legacy.
>
> Art House

Not even close!  The company sold for around $1.65 billion.  The were "loaned" $7.7 billion - far from paid back with interest.

Still, it need to be done.

train1275 Wrote:
-------------------------------------------------------
> I'll attempt a reply to maybe get some discussion
> going. I was not a Conrail employee but dealt 
> with them in mechanical and customer service
> issues and was involved with Conrail and "ex-Cons"
> in engineering projects on former Conrail lines
> that were sold off. Also I was a railfan with
> close contact with Conrail operating people at
> Mohawk-Hudson Division headquarters at Utica right
> up to the Superintendent level.
>
> Although to many of us at the time associated with
> "other than ex PC lines", such as the Erie
> Lackawanna, felt it was just one bigger Penn
> Central circus with blue paint, that is a bit
> unfair. Conrail in many ways seemed to focus on
> building "best practice" based truly on best
> practices of the roads that folded into it or went
> to a new a better standard completely.  I don't
> know if that originated with Ed Jordan or Dick
> Spence or what, but it started early on. An
> example would be in signals; signal systems and
> grade crossing signals. There were some fresh
> thoughts and clean sheets of paper and some well
> thought out standards with new people brought in.
> Mechanical seemed to have a heavy Reading RR
> influence but one that was not a Reading plan
> cookie cutter either. Operations and operational
> rules seemed to go the Penn Central way which I
> think PC largely adopted from PRR. As CR aged they
> went into other directions as NORAC came into
> being creating standardizations among many
> regional carriers as related to operating rules.
> I've heard that Conrail's engineering standards in
> general where well thought out and many were fresh
> clean sheets of paper rather than changing the
> logo on the previous document standard, but I
> don't have enough experience with that other than
> signals to speak further of it.
>
> I think certainly it became its own culture
> although for many years, and maybe right up until
> the end, there were still the "us" and "them"
> among the individual employees. Working mechanical
> projects it was always useful to know which former
> road someone came off in order to relate to them
> and get the job done. I would approach a former
> PRR guy different than a NYC guy.* (*many of the
> senior managers and officials into the early 90's
> were of the pre PC era, or if former EL were DL&W
> or Erie folks). 
>
> I think they managed to blend all the roads that
> went into Conrail better than PC made out in
> combining the NYC with PRR, and Conrail was
> certainly its own cultural entity.
>
>  

While his time at Conrail was brief, Dick Spence had a big influence on operations at Conrail.  He introduced the alpha type train symbols and as a result - had influence on train makeup practices and developed the dark territory dispatching system (basically the CT-401 - forerunner of the NORAC Form D) based on  SP practices, just to name three. 

NORAC initially included Conrail, NYSW and Amtrak.  As such - Conrail (and thus Spence) extended his influence to other carriers long after he left Conrail for the L&N.

Im no big Conrail fan.    All they did was abandon as many rail lines as they could, and survived bc they were given a monopoly.  After all the political BS and payoffs and laziness, it the EL was found to be solvent to the tune of 32 bucks a share, compared to the pennies a share that the stock was selling for when the dopes at the top decided it was banckrupt and threw in the towel.  Actually the EL was supposed to merge with the Chessie, but no one cared enough to try to work out labor issues.

I've heard and read a lot about the "them versus us" at Conrail and its predecessors, and you're probably going to have that at many merged and blended corporations.  Writing in his TRP column, former Lehigh Valley employee Mike Bednar apparently wasn't impressed with some of his ex-PC supervisors, at least during Conrail's earliest days.  Another Bednar column a few years later seemed more conciliatory. 

One thing that several observers have pointed out is that when Stanley Crane took over as CEO of Conrail, he didn't clean house, but rather largley kept the management team that was already in place.       

We lost Conrail to successful capitalism, in which Conrail shareholders made out very well indeed.

pdt Wrote:
-------------------------------------------------------
> Im no big Conrail fan.    All they did was
> abandon as many rail lines as they could, and
> survived bc they were given a monopoly.  After
> all the political BS and payoffs and laziness, it
> the EL was found to be solvent to the tune of 32
> bucks a share, compared to the pennies a share
> that the stock was selling for when the dopes at
> the top decided it was banckrupt and threw in the
> towel.  Actually the EL was supposed to merge
> with the Chessie, but no one cared enough to try
> to work out labor issues.

I loved the EL and wish that it survived, but have to respectfully disagree with you. The EL was far from solvent as a going concern. William White  who was one of the best rail exectives of the day (ex ERIE, VGN, DL&W, NYC, D&H) went (back) to the EL in 1963 til his death in 1967. He did not foresee an independent EL. After Dereco when EL filed bankruptcy they had serious cashflow problems with an eroding traffic base. They also had one of the most gung-ho executives as President, Greg Maxwell who pitched the independent reorganization outside of Conrail. EL also had excellent trustees, Patton and Tyler who backed Maxwell and were extremely astute businessmen. But an independent reorganization simply was not to be. As with PC they were looking at having to move towards liquidation or fall into Conrail. 

As to the Chessie deal, there were pros and cons, but it probably would have been a good deal for everyone except the west end guys who were screwed in any sense. And one guy who cared to break the labor impasse was Secretary of Transportation Coleman. He pushed like hell, even after the 11th hour, both for the Chessie deal and the Southern acqusitions of PC lines. Labor would not budge due in reality to the Title VII protections included in Conrail. There was no Title VII protection going alone or in Chessie or Southern. I think that is one major factor in the unions decision and it wasn't all the unions. Individually I don't know of anyone in EL labor who wanted to to go into Conrail actually, they wanted the Chessie deal. SOLD OUT was what I always heard. Sold out meaning by their union leadership. But I have to say if you really look at it, EL gave it one hell of a try and there was indeed high ranking powerful folks who cared and did push it, hard.

The stock payoff at the end was liquidation, not as a going concern, i.e. not solvent. In other words it was worth more dead than alive. The trustees did an excellent job in that respect.
Even just prior to the 1972 Agnes flood damage the EL was in very, very serious cash flow trouble. It was just a matter of time. The bankruptcy gave them time to try to reorganize but it just was not enough. The study of EL's financial statements and traffic from 1961 to 1975 are quite interesting.



Edited 1 time(s). Last edit at 09/16/23 07:39 by train1275.

That's a good analysis, train 1275.

I would add the EL commuter losses and NY state taxes were enormous millstones for any potential buyer.

Posted from Android

pdt Wrote:
-------------------------------------------------------
> After all the political BS and payoffs and laziness, it
> the EL was found to be solvent to the tune of 32
> bucks a share

Source?

It should be mentioned that a lot of rail lines were offered to shortlines.  If there were no takers, then they were abandoned.

mapboy

train1275 Wrote:
-------------------------------------------------------
> pdt Wrote:
> --------------------------------------------------
> -----
> > Im no big Conrail fan.    All they did was
> > abandon as many rail lines as they could, and
> > survived bc they were given a monopoly.  After
> > all the political BS and payoffs and laziness,
> it
> > the EL was found to be solvent to the tune of
> 32
> > bucks a share, compared to the pennies a share
> > that the stock was selling for when the dopes
> at
> > the top decided it was banckrupt and threw in
> the
> > towel.  Actually the EL was supposed to merge
> > with the Chessie, but no one cared enough to
> try
> > to work out labor issues.
>
> I loved the EL and wish that it survived, but have
> to respectfully disagree with you. The EL was far
> from solvent as a going concern. William White 
> who was one of the best rail exectives of the day
> (ex ERIE, VGN, DL&W, NYC, D&H) went (back) to the
> EL in 1963 til his death in 1967. He did not
> foresee an independent EL. After Dereco when EL
> filed bankruptcy they had serious cashflow
> problems with an eroding traffic base. They also
> had one of the most gung-ho executives as
> President, Greg Maxwell who pitched the
> independent reorganization outside of Conrail. EL
> also had excellent trustees, Patton and Tyler who
> backed Maxwell and were extremely astute
> businessmen. But an independent reorganization
> simply was not to be. As with PC they were looking
> at having to move towards liquidation or fall into
> Conrail. 
>
> As to the Chessie deal, there were pros and cons,
> but it probably would have been a good deal for
> everyone except the west end guys who were screwed
> in any sense. And one guy who cared to break the
> labor impasse was Secretary of Transportation
> Coleman. He pushed like hell, even after the 11th
> hour, both for the Chessie deal and the Southern
> acqusitions of PC lines. Labor would not budge due
> in reality to the Title VII protections included
> in Conrail. There was no Title VII protection
> going alone or in Chessie or Southern. I think
> that is one major factor in the unions decision
> and it wasn't all the unions. Individually I don't
> know of anyone in EL labor who wanted to to go
> into Conrail actually, they wanted the Chessie
> deal. SOLD OUT was what I always heard. Sold out
> meaning by their union leadership. But I have to
> say if you really look at it, EL gave it one hell
> of a try and there was indeed high ranking
> powerful folks who cared and did push it, hard.
>
> The stock payoff at the end was liquidation, not
> as a going concern, i.e. not solvent. In other
> words it was worth more dead than alive. The
> trustees did an excellent job in that respect.
> Even just prior to the 1972 Agnes flood damage the
> EL was in very, very serious cash flow trouble. It
> was just a matter of time. The bankruptcy gave
> them time to try to reorganize but it just was not
> enough. The study of EL's financial statements and
> traffic from 1961 to 1975 are quite interesting.

Thanks for all the info. Im glad to hear that someone tried to make it work.    I guess in some ways it was just a perfect storm of bad things, especially hurricane agnes and the loss of some big shippers, like the Mahway Ford plant, and NYS was in the "we're gonna tax the hell out of everything" mode.   EL was a good RR with dedicated ppl.  The Chessie deal would have maintained competition in the northeast, and i think would have been better for everyone in the long run...

My dad was in the oil industry, and i heard too many stories about dubious decisions being made at the whim of 1 person at the top, who always walked away with a golden parachute, regardless of losses from bad ideas.

After much reading about the merger era in the northeast, I've been feeling like we would have had a more balanced transportation system if PRR had allied with N&W-WAB-NKP and LV, and NYC had allied with B&O-C&O. Maybe EL could have joined with D&H, NH, BAR. Kind of half-baked conjecture. Would have been very interesting to see what would have happened if deregulation had happened in, say, 1960. Hope this isn't too far off topic.

halfmoonharold Wrote:
-------------------------------------------------------
> After much reading about the merger era in the
> northeast, I've been feeling like we would have
> had a more balanced transportation system if PRR
> had allied with N&W-WAB-NKP and LV, and NYC had
> allied with B&O-C&O. Maybe EL could have joined
> with D&H, NH, BAR. Kind of half-baked conjecture.
> Would have been very interesting to see what would
> have happened if deregulation had happened in,
> say, 1960. Hope this isn't too far off topic.

Well not quite on topic, but probably would have drifted in this direction anyway....and I guess as far a rethinking the past...it's sometimes fun to do, but we can do it with impunity...because we'll never be wrong, and we never will change the past. Making the future work out...now that's work. And the right decsions so hard to come by.