Since everybody is talking about the next round of mergers let’s go back 20 years. What if the Santa Fe merged with Conrail (I was actually hoping they would) in 1986 or 1990 Imagine the outcome of today’s rail mergers that commenced over the past decade. Or anybody remember back when the Southern Pacific, Chessie System, and Family Lines-SCL/L&N proposed merging let’s say these happened. Boy would today’s rail map be quite interesting.
Assuming you mean SF before BN, considering the problems both NS and CSX had digesting Conrail, I’d think the much smaller SF, which was having it’s own problems, wouldn’t have been able to pull it off, particularly without first splitting up Conrail back into PRR and NYC. If SF took one piece, it’s possible UP would have grabbed the other.
IMO takeovers are better than mergers because they usually avoid some of the cultural issues and it’s much clearer who’s in charge. PRR + NYC was a disaster from the start due to culture clash and because certain parties stripped off valuable assets. In contrast, UP is largely imposing it’s will on SP, and while some ex-SP people aren’t happy, it’s not too difficult to understand that a financially sound, successful company isn’t going to adopt the practices of one which is doing poorly. 3-way mergers of equals would be even worse.
I think that you would not of had the same issues that CSX/NS had if the Santa Fe had gotten them. I think that end to end has far lesss problems than overlapping mergers. I would have really liked to see the ATSF get the EL like they were talking about before CR, now that would have been nice to see.
Bert
On a somewhat related topic, I heard that Conrail had an interest in acquiring the SP when the UP-SP merger took place, or it could have just been that Conrail wanted to purchase only the Texas lines of SP. Did anyone follow this, would this have been a viable option, and if it had gone through, would recent history’ve been different?
Riprap
To Luke M: I got your message about the SP/UP/Rock Island attempted merger, thanks a lot for that update!!
Riprap
I think Conrail wanted the SP line to Houston or Galveston, Tx. for chemical traffic.
Yes, that’s about how I remember it too, (CR buying only the SP chemical line) and I also remember thinking to myself, Is it possible to buy only the one line? Is it? Can any major road pick and choose what lines they want to buy and leave the rest for other companies, or without potential buyers?
Riprap
Conrail wanted the STB to force the UP to sell the Cotton Belt to Conrail as terms of the UP/SP merger. The UP wanted nothing to do with it and, instead, arranged a trackage rights deal with BNSF that the STB thought was sufficient.
…Of course I can’t tell what mergers would work and not work but on the surface to a fan…one would think an end to end merger of Conrail {which I believe was doing well}, and Sante Fe which seems to have been a class act would have made a great transcon…
My bet is that Conrail would have had to be the parent here, not ATSF. Conrail, one has to remember was a giant, and the ATSF while sizable and well off, was not nearly as large. Conrail, was not just the Pennsylvania and the New York Central, but also nearly a half dozen other class 1s that all were rolled into one company by the government. By the 1990s Conrail had become one of the most powerful railroads in the nation. It can be argued that the emergence of Conrail as a cohesive system brought about the conditions for the CSX and NS mergers. If either system had been able to get Conrail entirely they would have won, it would have been one railroad that included PennCentral, the Anthracite roads, and everything they had before hand. One thing about market economics however is a striving for balance, so lets say that somehow Santa Fe and Big Blue ended up being one big Warbonnet Quality system. Instead of seeing the regional class one mergers that occured in the last ten years, we’d have seen transcon ones instead. Union Pacific probably would have still eaten the CNW but instead of trying for SP after that would have gone for Norfolk Southern, creating another transcon, and BN would have hitched it wit CSX. Southern Pacific would probably have languished in this and I’d bet eventually been split up between the three transcons. Interestingly though I believe this would have given American roads the clout to play head to head with the two big Canadian supersystems. Both CN and CP seemed content for years to hover over America like vultures, eating smaller regional lines without going to heavily into direct and really nasty competition with the American class-1s. (even though both of the Canadian roads are large enough to probably make a pass at that) So bottom line: instead of having the current situation where there are the two Eastern America roads, the two western American roads, the KCS/TFM system and the two Canadian supersystems, there would probably have been three transcons formed