Sale of Lackawanna Main to D&H

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Re: Sale of Lackawanna Main to D&H

Postby CPF363 » Wed Oct 19, 2016 8:11 pm

What would have made the D&H so much of a better railroad is if they could have worked out an arrangement to get full ownership of the line from Binghamton to Hagerstown. This would have been a big game changer for the D&H all around with friendly connection with Chessie System and N&W. Following the creation of CSX and Norfolk Southern, there would not be any need for the D&H to run down to Potomac Yard over the Northeast Corridor for connection to the Southern and the RF&P as all of that could have been handled through the Hagerstown gateway. Wasn't his an objective of Bruce Sterzing, former president of D&H?
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Re: Sale of Lackawanna Main to D&H

Postby XBNSFer » Sun May 14, 2017 3:03 pm

CPF363 wrote:What would have made the D&H so much of a better railroad is if they could have worked out an arrangement to get full ownership of the line from Binghamton to Hagerstown. This would have been a big game changer for the D&H all around with friendly connection with Chessie System and N&W. Following the creation of CSX and Norfolk Southern, there would not be any need for the D&H to run down to Potomac Yard over the Northeast Corridor for connection to the Southern and the RF&P as all of that could have been handled through the Hagerstown gateway. Wasn't his an objective of Bruce Sterzing, former president of D&H?


What you need to realize is that the D&H "expansion" to provide the new "Conrail" system with "competition" was a joke from the get-go. If they honestly wanted two northeast rail systems that were actually competitive, they should have done from the start what ultimately happened - divide the routes of all the northeast bankrupts into two competing systems based (mainly) on the former NYC and the former PRR, with the necessary additions of the other northeast roads to "fill out" each of the two systems. Instead, they cynically attempted to create a "successful Penn Central" by pouring money into mainly ex-PC routes and offering only comparatively second class routes (and with unacceptable labor rules) to any remotely real competitors (see the offer of EL to Chessie, who couldn't negotiate any better work rules than the failed EL already had, and backed out as a result; it was this that led to EL inclusion in Conrail and the D&H "expansion" to provide an illusion of rail competition in Conrail's territory).

The D&H "expansion" should, at the very least, have provided direct ex-EL routing access to the northern NJ terminals (say Croxton) if they wanted to actually provide some semblance of "real" competition. It's not as if Conrail was all that interested in the late-to-the-party ex-EL routes; if NY state didn't sink money into fixing track and signals on the "southern tier" route between Binghamton and Buffalo, Conrail probably would have abandoned it, or at least marginalized it heavily with single tracking and removal of signals. What the D&H got instead was a round-the-horn route via the ex-LV to Scranton, to the D&H's "home rails" to Binghamton (backtracking to something even more circuitous than the ex-LV (via Sayre), which itself was already probably the fourth best northern NJ to Chicago (via Buffalo connections) route), to the ex-EL trackage rights between Binghamton and Buffalo (with Chicago reached via N&W/NS, which was a single track railroad also not competitive with the two and three main track ex-NYC between those two cities), giving (ultimately) the D&H a 3rd morning delivery Chicago to Oak Island to "compete" with Conrail's SECOND morning delivery Chicago to North Bergen/Meadows/Croxton/Portside. As I said, a joke; the best the D&H was ever going to do was cherry-pick some Friday loads at a discount price (when the weekend somewhat nullified the extra day of delivery time) and lower-priority (and also less generously priced) traffic. And even this was strictly intermodal access; the D&H expansion wasn't given access to carload traffic at Oak Island. The D&H "competition" was a facade, and was set up to fail.

The north-south traffic might have been more effectively served by the control of the routes you mentioned, but prior to Staggers (October of 1980) the rate divisions made north-south traffic less than lucrative for the northeast roads, and with Corridor ownership being transferred to Amtrak so they could build it up as "high speed" passenger rail, they undoubtedly wouldn't have hobbled their new pet railroad with no Hagerstown gateway. For the northeast railroads, it was east-west traffic that was the most lucrative, and the routes the D&H was provided access to provided them with little to no ability to compete for such traffic - by design.
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Re: Sale of Lackawanna Main to D&H

Postby XBNSFer » Sun May 14, 2017 3:34 pm

YamaOfParadise wrote:
Matt Langworthy wrote:It is interesting to see how the same segment from Scranton to Bingo fits NS's operating plans now, when it didn't fit CR's plans from 1979 onwards.


Really shows how complex the importance of a line is, namely in comparison to one railroad's system, it's partnering lines, and its competitors. (And economic conditions of course; you have to be able to connect markets that goods actually are going to flow in, of course.)

Those factors go both ways; PC was doomed because of this, having tons of redundant routes; Conrail inherited much of that mess, and even more railroad's routes that further were redundant to the PC system like the Lackawanna Main. Certainly wasn't redundant to the D&H in the era post-Dereco/N&W, and also not redundant to Guilford when they acquired the D&H.

...but I guess it was destined to be part of NS, considering the N&W formed Dereco to hold EL and D&H, ICC required inclusions if they were to merge with Wabash/NKP; took a number of extra decades, but it happened eventually!


PC (and most northeast railroads, for that matter) was actually doomed because of much more than some route and terminal redundancy. Reality is, NYC and PRR were already money losing operations as railroads before they merged (their non-railroad businesses were the only thing giving the companies any profit as a whole), and the merger didn't solve any of the underlying issues, was done for the wrong reasons, and if anything only accelerated their ultimate (but probably inevitable) descent into bankruptcy. Until Staggers gave the railroads the freedom to negotiate reasonable rates (and to modify rates), shed light density lines that didn't earn enough to maintain, and enter into private contract rates, and until the railroads were able to shed money losing passenger operations (in particular commuter operations in the northeast), and until work rules stuck in the 19th Century could be modified, the railroads in the northeast would continue to founder. Before these changes, Conrail, despite billions dumped into track, locomotives and rolling stock, extensive abandonments, and tax deferrals, continued to lose massive amounts of money. Until these "organic" issues were dealt with, Conrail remained a government ward, and a PC provided with nothing more than the ability to shed some redundant routes would still have failed.
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Re: Sale of Lackawanna Main to D&H

Postby Engineer Spike » Tue Jun 20, 2017 4:52 pm

I agree that the D&H expansion was a joke. I too have wondered why they weren't given the chance to buy the Erie. This would have provided a direct western gateway to Chessie, N&W, and CN/GTW, for Chicago. CP could be reached for other western points too.

As was mentioned, the southern gateways were less profitable. Here trackage rights might have been ok anyway. This corridor had less lines to give up anyway. With the PRR lines being used for high speed passenger, the Reading lines became the primary freight conduit.

In Rush Loving's book, he quoted McClellan as saying that it would have been too hard for the USRA to unmerge PC. NS, and CSX did so 25 years later. This makes me believe that there must have been many back door deals. MARC-EL sounds like a joke too. The PRR, and NYC had all the prime industrial cities on their routes.
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Re: Sale of Lackawanna Main to D&H

Postby lvrr325 » Wed Jul 12, 2017 2:12 am

I think the MARC-EL plan could have worked at least initially. It would have depended on the road being a double stack pioneer, though, and would be very weak otherwise as a lot of the industry that was on the old EL has gone away.

The expanded D&H probably could have had the Reading from Harrisburg to Shippensburg, and the CNJ from Easton to Jersey City, but to get below Sunbury the PRR is the only option and it would have had to have been shared with both Buffalo Line and Corning Secondary traffic that existed in 1976.

As for the New Jersey route, they'd have to use the LV/CNJ combined route below Wilkes-Barre to get to Easton, although they could probably have bought both portions of LV that were eventually pulled up. In fact I've read Conrail ripped up the LV between Lehighton and Allentown expressly to prevent the D&H buying it. There may have been enough plant left still in '76 to dedicate a track in the commuter zone to freight only to avoid fighting too much with the commuter traffic.

Trackage rights routes usually really stick it to the guest railroad at the benefit of the host.
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Re: Sale of Lackawanna Main to D&H

Postby mtuandrew » Thu Aug 03, 2017 8:50 pm

In 1975-6 it probably was too hard to surgically separate PRR and NYC, and not for simple trackage reasons: the real estate, employees (with different agreements and seniority), rates and contracts, communication networks, and all sorts of other hidden issues were a mess for one road to untangle. Trying to sort them into Red Team and Blue Team piles seems Herculean when the NYC system would include former PRR properties, the PRR system would include former NYC properties, both would include properties from the other systems (NHV, RDG, EL, LV, CNJ, AA, LHR, and probably DH in this alternate reality), and both would be tenants on lines removed for passenger traffic. All that is ignoring the different standards of maintenance for both rolling stock and physical plant. Then there's the biggest issue: who gets the best customers, best yards, best equipment, and best employee agreements.

All of that said, a recapitalized EL-D&H + some Reading and Lehigh Valley lines + the Ann Arbor & DT&I (for good measure) would have been worthwhile, if only as an independent access to the Port of New York-New Jersey, the Anthracite region such as was left, and the Philadelphia market. Call it the Erie & Hudson, just for giggles.
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