It appears we have pretty much ran the distance on the BN components to the north (NP, GN, Q) and now want to explore the Frisco, or the St. Louis - San Francisco Railway Co.
I had one brief exposure to the Frisco and that was in Jonesboro, Ar. during the early 70’s when I attended a camp at Arkansas State University for a few days. The dorm room faced the south and there was the Frisco and the Cotton Belt tracks within a short distance. I saw lots of trains that week.
What were the circumstances leading to the BN buying the Frisco? Looking at the BN map of the 70’s, it appears the Frisco was simply an extention of the BN coal generating abilities…primarily KC to Memphis and beyond.
I get the impression Frisco was primarily a bridge route that had a pretty interesting route structure connecting St. Louis, Kansas City, Memphis, Tulsa, OkCity, and DFW. There was also the route to the Santa Fe at Avard, Ok.
They seemed to be kinda like the Rock of the Southwest…went everywhere the MoPac did (well, MoPac didnt go to Birmingham).
What did they do well? Why did BN purchase Frisco over MoPac?
BN acquired Frisco primarily to improve its balance sheet during period of heavy expenditures for Powder River Basin build-out. Frisco was searching for a merger partner because it understood that under deregulation it would fail: its hauls were too short, its revenues too dependent upon interline splits that would be reduced; its on-line originations and terminations too meager; its routes too costly to operate. Frisco figured that its value would never be higher and it was high time to protect its stockholders.
The strategic fit between BN and Frisco was small, but the fact that it was an end-to-end merger rather than a parallel merger was seen as a nice bonus because it would aid in obtaining ICC approval. Everyone was quite aware of the history of the ICC’s deliberate consideration of mergers. BN-Frisco Kansas City-Springfield-Memphis-Birmingham was about the most attractive new route but at that time there wasn’t much traffic on the line, and the growth of PRB coal on that route was still in the cloudy future. Frisco’s connection with Santa Fe at Avard was historically a dot on the map noteworthy only to railfans, and did not come of age until the 1990s with the BNSF merger. Frisco’s routes were generally of rather discouraging quality both in operating costs and traffic, existing and potential.
BN-MoPac wasn’t seen as feasible as it would have brought everyone west of Chicago to the table and would have been a UP-SP-Rock Island debacle all over again. The cards for the west were played with the ICC’s failure to rationally sort out UP-SP-Rock Island not later than 1966. Once that fork in the road was taken it essentially committed the west to the present form.
Thanks, as always for your explanation. I have read that BN liked Frisco’s balance sheet, but in examining balance sheets for both BN and Frisco, BN actually had a lower debt to equity ratio than Frisco. Of course, the balance sheet reflects only numbers and those assets may have had a higher value than stated.
The writing was certainly on the wall for the Frisco as the decade grew to an end. Tonnage was stagnant the entire decade of the 70’s and the OR was pretty high. Deregulation was not going to be good for them.
What seems strange is that Frisco would have made sense for the Santa Fe possibly more so than BN. Santa Fe could have gain two markets - StLouis and Memphis and could ahve opened up the southeast and the Middle Atlantic. SCL/Frisco/SF were already operating run thru service from the Southeast to SoCal, so there must have been a little potential there.
Sure, there would have been redundancy (Kansas City/OKCity/DFtW) and the route to Memphis from the Transcon would have been somewhat out of the way, but Santa Fe could have given SP/Cotton Belt a little competition to both Mississippi River gateways.
Perhaps at the time, Santa Fe was already strategically thinking of merging with SP and didnt wish to add other routes. Or perhaps Santa Fe just didnt desire merging, thinking their Chicago -Southern California route was superior to anything out west.
It seems Santa Fe considered several mergers in the 70’s/80’s before the SP. Erie Lackawanna and Conrail were both looked at, probably more.
BTW, does BNSF do much on the StL-Memphis river line?
I wish my Uncle Pete were still with us as he had a passion and loved talking about his former employer until his death in 1994. He worked primarly as a brakeman @ Wichita from 1935-1973. After BN acquired the property, they basically destroyed a stable rr serving KS. At merger time, Frisco operated two yd jobs daily plus the 330 & 337 through freights running between Wichita & Springfield both directions 6 days a wk. In about June 1982, the freights were abolished and changed to tri weekly locals 91666/91667 between Wichita & Neodesha, the crew base moved to Neodesha and the yd jobs cut to a 2nd shift M-F job.Shippers then took their buiness elsewhere.Pete’s son was a Wichita engr and lost his job over on these cuts, then had to relocate to Ft.Scott just to keep his seniorty and worked there until retiring in 2004. West of Wichita @ Buhler, ADM operated a small bulk flour mill loading 5-6 cars a day which the west local would work every trip. Service was cut to 2 days then 1 day a wk and the mill switched to trucks just to stay in business until closing in 2000. Yes my family had fond memories of Frisco but hated BN w/a passion.
Sounds like there was quite a bit of work in Wichita. It also sounds like it was similar to other railroad markets. The local business seemed to “dry up” about the same time. We all ask ourselves if it was a function of the railroad not servicing the industries, or deregulation, or changing economics, or perhaps all of the above.
I watched my local IC business dry up from 75+ cars a day to nothing. That is why I am finding the decade of the 70’s so interesting. It is when the changes really started to manifest and show.