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Penn Central Merger


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The Penn Central was born amid great expectations and promises on February 1,1968 by the merger of the New York Central System into the Pennsylvania Railroad on that date.
Neither railroad had been forced through the trauma of bankruptcy and reorganization.
With incompatible computer systems ,signal systems, operating styles, and personalities at the top, the new railroad remained essentially two in operation though it was one in name.
Penn Central

Welcome to our Penn Central WebSite

Here's a preview of some of the exciting projects we have put together for you:

Our feature article: The Story of Penn Central

Penn Central Reference Material

Why Did Penn Central Fail?

Decline of Intercity Passenger Service

Penn Central on the Stock Market

Penn Central Amtrak Stock

New York Central Merchants Despatch .

New York Central Pacemaker Service .

A lot about NY Central's EMPIRE SERVICE. Even more about EMPIRE SERVICE.

Red Ink Express 1959 .

Poughkeepsie Bridge, Cedar Hill versus Selkirk

Harsimus Branch

Penn Central on the Lake Ontario Shore

Story of the Lost Box Cars

Penn Central Map

Derailment in 1976

New England Gateway, The New "Alphabet Route"

Metro-North Commuter Railroad
The merger between the New York Central RR and the Pennsylvania RR was like a shotgun wedding. Both bride and groom hated each other. Yet, there was no other option but to join hands in unholy matrimony, and if this wasn't bad enough, the bride and groom had to accept the New Haven RR as an unwelcome boarder in their honeymoon suite.
Penn Central RR Historical Society
Grand Central Terminal and the New York City Subway
This page is our gateway to New York City. Find out about the New York Central Railroad's Grand Central Terminal. Explore the fabulous New York City Subway System. Learn who Robert Moses. was and his impact on New York City. Understand New York City transit planning, West Side Freight Line (the "High Line") and St Johns terminal. The New Haven Railroad and the Long Island Railroad reached into New York City. Did you know the Lehigh Valley Railroad even went into New York City (by ferry). Learn about the Jenney Plan to bring commuters into New York City and finally explore mysterious track 61 at Grand Central Terminal with its relationship to Presidents of the United States.

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Penn Central

It officially started March 19, 1962 when a merger petition went to the Interstate Commerce Commission and took until February 1, 1968 to become real. It was the merger of the Pennsylvania and New York Central into the "Pennsylvania New York Central Transportation Company" (hereafter called "PC" or "Penn Central"). It started with 19,286 route miles; assets of $4 billion; revenues of over a billion dollars; 4,202 locomotives; 194,656 freight cars; and 4,937 passenger cars.

The two railroads did things differently and always had. New York Central was the Water Level Route while Pennsylvania Railroad crossed the Alleghenys. NYC liked 4-6-4's while PRR championed 4-6-2's. NYC was gray while PRR was tuscan red. NYC opted containers while PRR went piggyback.

If one reasoned mergers, PRR should have taken over Norfolk & Western while NYC took Chesapeake & Ohio/Baltimore & Ohio. These didn't work so NYC & PRR decided to join - like jilted lovers on the rebound. Alfred Perlman had become president of the Central in 1954 when Robert R. Young took over the road. He was an efficient manager but also a realist. He knew that without government help he needed a merger. He surely couldn't count on government help - government had built the New York Thruway and St. Lawrence Seaway, both of which drained the Central's freight revenue. Arch rival Pennsylvania was also looking for a merger without success. The option for both roads, such fierce rivals, boiled down to each other. Young and James Symes, chairman of the Pennsylvania, began talks in 1958. After Young's death in 1958, Perlman continued talks with Symes.

Stuart T. Saunders made PC a fact. He placated both labor and government. Al Perlman contributed the ideas which might have made the merger work - electronic yards; Flexi-Van; computerization; passenger-speed freights.

One hooker in the deal was the ICC's insistence that the bankrupt New Haven be included. Neither PRR or NYC wanted it. The New Haven had been hurt by stock raiders and by the Connecticut Turnpike. Its commuter service was huge but unprofitable.

Perlman was unhappy from the start - he didn't hit it off with Saunders, who had replaced Symes in 1963. Penn Central started out life in financial distress. The New York vs. Pennsylvania hatred made it difficult for ex-PRR and ex-NYC people to work together. Ex-Central executives ran transportation while ex-Pennsylvania execs began to dabble in real estate and amusement parks.

The road ran in utter confusion. Freight trains were actually lost and ended up in the wrong city. Shippers left in droves. Saunders wouldn't give Perlman money for maintenance so the condition of the line suffered.

The Penn Central Railroad went under in June, 1970. Its creditors began to hound it - some of them wanted to shut it down to get back their money. 1970 saw a stock market plunge. Based on fear of a 1929-type crash, PC got some government-guaranteed loans to keep afloat. The end was near when banks began to sell their PC stock. Washington refused more loan guarantees - leaving bankruptcy the only out. The railroad had to continue operations at a time when it could barely keep running without pouring in huge sums of money to rebuild its facilities. These sums, however, would not be available until the railroad showed it could be reorganized.

The bankrupt railroad continued to operate under a board of trustees. 1971 saw some relief as AMTRAK took over passenger routes. In the New York City area, Metropolitan Transportation Authority assumed ownership of commuter routes. The low point was 1973. The trustees set an ultimatum when operations would stop without government aid. The Rail Revitalization and Regulatory Reform Act (ultimately growing into CONRAIL) was passed.

Scores of other problems arose from a lack of money. Agonizingly for everyone on the Penn Central, there were sources of capital that could not be touched. For example, just about every abandoned mine branch in the Allegheny Mountains was chock full of PC cars destined for scrap. With the scrap prices in the early 1970's, this was a potential gold mine. But the creditors would not allow this asset to be turned into cash that would be reinvested in the estate, since that estate was eroding day by day.

The creditor's interest also got in the way of sensible maintenance. Between Indianapolis and Terre Haute, the former New York Central and Pennsylvania had double track, high speed main lines rarely more than three miles apart. After the merger, most traffic was routed over the old New York Central and the Pennsy line's second track was picked up. There were still 11 miles of double track left in 1974 and the 132-lb rail was in excellent shape. It was desperately needed on the old Central line where double traffic and deferred maintenance had left much of that stretch with 10 mph speed limits. The obvious thing to do was use the good rail on the needy line, unfortunately, the rail belonged to a Pennsy subsidiary, itself in reorganization. The creditors would not permit the asset to be moved, except for "cash on the barrel", which, of course, was unavailable.

Bankruptcy saw several sales to try and raise money. A 1973 auction sold 1,527 tarnished pieces of silverware for about $10,000. This was about equal to what the railroad lost in 25 minutes of operation. Sold at the Philadelphia auction were items such as sugar bowls, steak platters and bud vases. Most of the buyers were train lovers and collectors, some old but many too young to remember the glory days of the great trains. Penn Central's bankruptcy was attributed by some people to mismanagement; however, the National Labor Relations Board dictated wage settlements and the ICC controlled prices. The U.S. Government told PC's creditors they couldn't foreclose and that PC must operate even though it was at a loss.

By 1975, Penn Central's situation was very serious. Without Congressional aid it was unable to meet its payroll. Making things worse was the fact that the ICC kept postponing freight rate hikes. Many felt that PC got a brush off because of disbelief a two billion dollar company could simply up and quit.

What was wrong with Penn Central was politically difficult to cure. Between a quarter and a half of the 19,621 mile (1972) road was redundant; yet mention the word "abandonment" and everybody from governors to ecologists were ready for battle. Even running as few trains as possible over ill-maintained tracks, 78,752 persons were on the 1975 payroll (down from 95,772 at bankruptcy). This was 4 people per route mile as opposed to Santa Fe's 3. Attempts at crew size reductions brought strike threats. PC also had a commuter burden in Boston, New York, Philadelphia and Washington. (you don't really believe government subsidies covered the whole thing do you?) These distractions prevented PC from countering truck competition with high-frequency, high-speed, on-time service.

Beginning in 1973, the United States Railway Association (USRA) (formed by Congress), cut 12,000 miles of track from PC operation. By 1976, CONRAIL was born.

By Ken Kinlock at
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Harsimus Branch

The Pennsylvania Railroad Harsimus Branch Embankment carried freight across six blocks of downtown Jersey City to the Railroad's Harsimus Yards, located on the Hudson River directly across from Manhattan Island. The embankment, which fronts and runs parallel to Sixth St., consists of six segments, each approximately 400 feet long and 100 feet wide

Constructed in the period 1901-1905, the Harsimus Branch Embankment was a major component of the once predominant railroad landscape of Downtown Jersey City. It was connected to the Pennsylvania's Main Stem by an elevated, two-track line from which it branched near the Waldo Ave. Yard. This freight line connected to a spur of the New Jersey Junction Railroad just before reaching the embankment, allowing Pennsylvania waterfront freight to be moved north at the base of the Palisades to other rail systems.

Night and day, steam powered locomotives chugged upon it above the streets of Jersey City. Heavy traffic continued into the early post World War II period. Much of the cargo was produce and cattle headed for slaughter at waterfront abattoirs. Soon after World War II, competition from trucking and containerized shipping rendered much of Jersey City's railroad infrastructure superfluous. Operated less intensely after the demise of the Penn Central by Conrail, the embankment carried (if only to reverse direction) lengthy diesel powered "piggy back" container trains as recently as the early 1990s.
Penn Central Movie

This is the movie commissioned by the Penn Central Railroad bankruptcy trustees to try to convince members of Congress that the railroad desperately needed a cash infusion or some other federal intervention if the railroad were to survive.

Think of it as the social media of its day, a corporate movie commissioned as a way of educating elected officials who had little time or inclination to actually visit the railroad to find out what was going on.

In fairness, there are some anecdotes I've heard about the making of this movie, including the fact that some of the really bad conditions just wouldn't cooperate with the filmmakers. So instead of showing actual "standing derailments" (derailments caused by crossties so rotted that the rails just spread apart under the weight of the freight cars), they actually had to stage some of them.

There is a scene of a car derailing as it moves down the "hump" track in a classification yard, and I'm told it took more than one take to get it to derail.

Despite these moviemaker tricks, the facts were pretty bleak for Penn Central.

And the movie did help convince Congress to do the only right thing.

Take control of the company and the other bankrupt railroads, and make something new. Conrail. And considering what the car companies are asking for as an INTERIM solution for just the next three months ($15 billion), Conrail was a bargain at $7.6 billion -- all in.

That's pretty much where the auto industry should be headed. Even as I was preparing this blog entry, I came across the daily agenda in the previous entry showing that GMAC is still taking folks out for expensive breakfast meetings, even as its owners go begging the taxpayers for a handout.
Penn Central Movie
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Timeline of Railroads in the Adirondacks

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Railroads in New York State

All-time list of railroad names in New York State

Some interesting things about New York State Railroads, mostly New York Central Railroad

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Metroliner Postcard

Penn Central Sign

Penn Central Metroliner, postcard

Metroliner was a premium express train service run by the Pennsylvania Railroad, Penn Central, and Amtrak, between Washington, D.C., and New York City from 1969 to 2006, with first-generation self-powered cars being replaced by new (although somewhat identical looking) locomotive-powered set in the early 1980s. The train offered reserved business class and first class seating. A trip between New York's Pennsylvania Station and Washington, D.C.'s Union Station took 3 hours. Amtrak has replaced Metroliner service with Acela Express.

Some original 1969 Metroliner multiple unit cars had been converted to serve as Amtrak's push-pull cab car fleet in the late 1980s. Some are still in use today, on Springfield, MA-New Haven, CT shuttles and push-pull AEM7 Keystone service.

The High Speed Ground Transportation Act of 1965 started a U.S. Government effort to develop a high speed train for Northeast Corridor service. The U.S.Department of Transportation worked with the Pennsylvania Railroad, Budd Company, General Electric and Westinghouse to developa Multiple unit high speed passenger train with initial service target for 1967.

After several setbacks, Metroliner service started on January 16, 1969, operated by Penn Central Transportation, successor to the Pennsylvania Railroad. The initial trip between New York and Washington took 2:59, 36 minutes faster than the previous best.The train consisted of six cars; 2 club cars and six snack bar coaches,full coaches weren't added until October. By April 1969 the fastest scheduled train took 2:30 running at 125 mph.

By Ken Kinlock at
Penn Central GG1

This beautiful locomotive, a GG1, was Pennsylvania Railroad, then Penn Central

Conrail Merger
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Railroad Biographies

Penn Central to Conrail

USRA had three jobs. The first was to choose the bits and pieces of Penn Central, Erie Lackawanna, Lehigh Valley, CNJ, Reading, etc. that could be used to make up a viable rail system. The second was to provide rehabilitation funds to Conrail, and to ensure those funds were wisely used. The third was to value the assets selected for conveyance, pay the price to the bankrupt estates, and then litigate the value in a special court with lawyers for the bankrupt estates.

USRA valued the conveyed rail assets at roughly $500 million. The litigation was ultimately settled for about $7 billion, so some shareholders of the bankrupt estates (depending on when they bought the stock) made out quite nicely. In addition, USRA provided about $2.5 billion in financial assistance to Conrail, in return receiving stock and bonds which were held by the government until Conrail was sold in a public stock offering in 1984.

All of the rail assets not selected by USRA for conveyance, along with all of the non-rail assets (Buckeye Pipeline, Sperry Rail Service, non-railroad real estate, etc.) remained with the bankrupts to be disposed as they saw fit. Some rail trackage not conveyed was operated as "subsidized light density lines" (LDLs) for a few years under a transitional Federal program administered first by USRA and later (until ended by the Reagan administration) by FRA. States would nominate LDLs for continued operation, and in most cases a private "designated operator" provided service.

What is now Amtrak's Northeast Corridor was conveyed to Conrail in 1976, but with the understanding that it would go to Amtrak as soon as USRA put a value on it. This was done, and it was transferred to Amtrak in late 1977. Amtrak paid Conrail by simply forgiving trackage rights charges Conrail would have otherwise paid. This period of free use ended in 1982, at which time Stanley Crane re-routed most rail freight off the NEC and ended electric freight operation.
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Penn Central Railroad Online!
List of Connecticut Railroads
List of Illinois Railroads
List of Indiana Railroads
List of Massachusetts Railroads
List of Michigan Railroads
List of New York Railroads
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List of Ohio Railroads
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Penn Central Hauls the Coal!
Chip Syme's Penn Central's Valley Division
Penn Central Home Page
Penn Central locomotive rosters
Pennsylvania Railroad Technical & Historical Society
An attempt to archive the paper history of the Penn Central Railroad online.

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1937 Fan Trip Brochure
See our poster and brochure about a fan trip on the New Haven RR in 1937. It ran from NY City to Bridgeport, Danbury, Poughkeepsie, Maybrook, and Campbell Hall to Warwick NY. The brochure contains a description of the route including the big bridge in Pok plus a map. The fare was $3.50 round trip.

How much would you pay to ride that trip today ?
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New York Central Home Page
This article appeared August 1990 in the CALLBOARD of the Mohawk and Hudson Chapter of the National Railway Historical Society.
Turbo Train Hojack Swing Bridge at Charlotte on the Genesee River from a postcard found in St Joseph, Michigan)
Special Research Section on the Lake Ontario Shore Railroad.
This section contains information that is unpublished elsewhere!
In the early 1870's, the Lake Ontario Shore Railroad had been built from Oswego along the shore of Lake Ontario to the Niagara River (Suspension Bridge). It bypassed Rochester, had no manufacturing industries and first became part of the Rome, Watertown & Ogdensburgh which was acquired by the New York Central.

Anybody remember the story of the "lost PC box cars???

They were taking boxcars from large railroads, repainting them and assigning new numbers. They were presumably counting on the larger railroad losing track of their cars.

It all revolved around a little railroad called the Lasalle & Bureau County.
Penn Central was the unwitting source of most of these cars; they looked like old NYC 40-foot box cars, primarily. It took place in 1971. The whole episode didn't cover much time, as far as I can tell, and the Equipment Registers I have from that era don't seem to have anything.

The scheme seemed to revolve around a "repair shop" located on the LS&BC and owned by another, related corporation. This company contracted with PC to "rebuild" boxcars.

Once the cars arrived, a fair percentage of them were deemed to be "un-repairable". PC was notified and the company offered to scrap the cars out for a fee. These "un-repairable" cars (they actually were quite servicable) were then hastily restenciled for LSBC and put back on the road, earning car-hire charges for the new owners.

The game was over when one of these cars was damaged and came to a PC shop for repair. The original car number was discovered stenciled on the underbody.

Oh yes ... the La Salle and Bureau County's nickname? LSBC = Let's Steal Box Cars!
Amtrak's Secret Business
Amtrak's Secret Business
Penn Central Map
Click HERE or on map above to view.
Derailment in 1976

Derailment in 1976

Almost 100 years old, the tower in Matteawan, New York was badly damaged by a train derailment. Notice the Penn Central truck at far right. After the accident the tower was removed completely so that only the markings of a stairway show on the factory wall.

The ND&C RR (Newburgh, Dutchess and Connecticut Railroad) established an operation that survived through good times and bad for over 25 years until it was absorbed into the Central New England Rwy and later became part of the New Haven RR. Still later 11 miles of the old ND&C line became part of the ill fated Penn Central, next Conrail, then the Housatonic RR and currently Metro North.

After many years and many different names, these tracks are still in service and owned by Metro North MTA. There is no regular train service on this “Beacon Branch” but they are keeping the line open for possible future use.

To see more about this historic rail line, once a part of the Central New England Railway in New York State and the New Haven Railroad, click here
Victoria Station Victoria Station was a restaurant, not a railroad station.

Other railroad-related restaurants in Connecticut:

Yankee Silversmith Inn / Restaurant has the "Silversmith Parlour Car", an old coach or dining car which serves as part of the dining room. Right on Rt 5 in Wallingford, off the Wilbur Cross Pkwy. The car at the Yankee Silversmith restaurant in Wallingford CT was originally a Philadelphia & Reading coach. It later was purchased by the Belfast & Moosehead Lake, and from there it came to Wallingford I think during the 1960s.

Pizzaworks in Old Saybrook is housed in the former Saybrook freight house (relocated slightly from a different track alignment years ago). They have trains running around and part of the old canopy/platform visible inside. Amtrak station is about 20 feet north of the restaurant and the platforms 20 feet south. Trains go flying by at nearly 100 mph.

In Cromwell CT there is a seasonal ice cream stand in an ex Amtrak, exx PC, exxx PRR steel caboose, no number available.

Find out more on the train stations (and former stations) of Connecticut.
New England Gateway, The New
See another "Alphabet Route" that used the Ontario & Western to connect Maybrook to the DL&W and Lehigh Valley.
Connecticut Freight Railroads

There is no "brrreeeport" in Connecticut, but there are plenty of towns that are served by freight railroads.

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Signal Stations of the
New Haven Railroad

Signal Stations of the New Haven Railroad
Includes New Haven speed limits and trackage rights
Also sections on Bridgeport and
State Line interchange

Click here or on picture to see full story.
The Central New England Railway (later New Haven RR) Maybrook Yard connected to other railroads: Lackawanna, Pennsylvania, New York Central, Lehigh & Hudson River, Lehigh & New England, Erie, Ontario & Western, Lehigh Valley

The Central New England Railway Yard at Maybrook, New York

We have a really new and really cool feature about the Central New England Railway / New Haven Railroad. It is a Journal of the Maybrook Yard. All kinds of previously unpublished and fascinating things!

The Maybrook Line across Dutchess County The "Maybrook Line" was important to New England before the advent of Penn Central and before the Poughkeepsie Bridge burned. This piece of the railroad carried freight from Maybrook Yard, across the Poughkeepsie Bridge to Hopewell Junction where it joined a line from Beacon. The railroad then went to Brewster, then Danbury, and finally to Cedar Hill Yard in New Haven.

The New Haven's Maybrook Line and connections to other railroads

Railroad History of Maybrook Region
Peoria and Eastern Railway (P&E) Company
Peoria and Eastern Railway
Old certificate from the Peoria & Eastern Railway
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Old Lyme bridge See our special section on

New Haven Railroad Bridges along the Shore Line

Purchasing this section, also gives you:
New Haven Railroad history from 1844 to 1967.
How the Farmington Canal was converted to a railroad.
Naugatuck Line and other abandoned railroads in Connecticut.
The Essex Steam Train and when new steam came to Essex.
Story of the 'Pullmans on a hill'
Niantic bridge
George Alpert. Last President of the New Haven Railroad. Talking with Albert Einstein at Brandeis University Canal Line today through New Haven
Canal Line today through New Haven
Troop Trains
Troop Train Photo Album
Photos of a trip from Texas to New York City (World War II) as an armored division brings its equipment and troops to the port.

Connecticut's Farmington Canal was converted to a railroad by 1848. The road was named the New Haven & Northampton, but has always been called the Canal Line. The road's first terminal in New Haven was between Temple Street and Hillhouse Avenue.

Click Here or on any of the pictures to read about its history, present and the future
New Haven's Canal Line New Haven's Canal Line New Haven's Canal Line
See KC Jones BLOG about Railroad History

See my blog on Investing, Railroad History Penn Central Transportation Company – Lehman Brothers Collection – List of Deals
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