I asked this question in another thread and someone suggested I start a thread on this. So I ask:
What if Al Perlman had run Penn Central with or without the support of Blevens (the CFO) and other money people?
Could his management team have made it work? Mr Perlman had been and had developed a lot of 1st rate talent. And when he left the Rio Grande he left a railroad that certainly was hustling for a living.
When he was at the New York Central Mr Perlman had immediate impacts.
Thx IGN
Quite possibly, but they had alot going against them right from the get go…incompatible computer systems, a regulatory environment that didn’t allow pricing in accordance with the market, outdated labor practices and featherbedding, strong competition from trucking on general freight, …etc. In retrospect they probably never had a chance… They had talented people…but they ran out of time and money… bascally they had a couple of years to make changes that would normally require 15 or 20 years.
They also had money loosing passenger and commuter operations all over the place, plus the dead weight of the New Haven and its passenger trains. My personal opinion is that no mortal could have saved PC.
Mac McCulloch
I wonder if Perlman would have taken the job, had he fully understood the true situation he was getting into. Had he left at the start of PC, the railroading world may have been different.
The conditions that took, PRR, NYC & PC under were far beyond the ability of any carrier management to overcome. The changes necessary to bring profitability to those lines and what became ConRail required both legislative and regulatory changes that no management could pull off until the wreckage of the companies became fully evident to those who could make such changes - legislators & regulators. As the Titanic was considered unsinkable in it’s day, the railroads, when viewed by legislators & regulators, in the 50’s, 60’s & early 70’s were also considered unsinkable - until they sank!
The Titanic is a good analogy. Bringing back PC from the brink would have been tantamount to bringing the Titanic safely to shore after striking the iceburg. As J Paul Getty famously stated…many things are IMPOSSIBLE.
What was the alure, that brought Perlman east to start with?
The biggest thing, getting out on the property and meeting with people. An engineering eye to see when things are not right. Getting things hustling(at Rio Grande he started getting cars off the line before the 12m per diem would strike) . Having a management development program to train and advance people so they would get a well rounded feel about how to run a railroad.
And also the patience to deal with people who were at the limits of their abilities.(ie he did not throw chairs at people without very very good cause. If you did your best for the man he would respect that, if you tried to bs Mr Perlman he would take you apart).
He knew the business.
Thx IGN
About the Titanic: Investigators have uncovered the fact that the shipyard ran out of steel rivits and substituted obsolete iron rivits where they thought the hull would be least stressed. If steel rivits had been used throughout, the ship would not have broken apart nor sunk.
Pearlman could have been the steel rivits for Penn Central. He would have seen things as they were and warned people that legislative action was neccessary to save freight railroading from becoming a money-loosing ward of government as passenger service (worldwide) has become.
The carriers & the AAR had been pleading their case for years for legislative fixes - all fell on deaf ears until the PC sank, Perlman may have prevented the sinking for several months - but PC was sinking and there were no actions outside of legislation that would have prevented it and until it sank legislators didn’t think there were any problems.
I doubt Pearlman heck JP Mrogan Hill or any of the BEST Railroad CEO’s Present or Past could have saved the PC I highly doubt the Mighty Hunter Harrison could have saved that Monster why the Regulatory Enviroment itself was not setup to allow it to make the CHANGES NEEDED TO SAVE IT. When it took Years to abandon a line that had no frieght they were basically a Duplicate system that needed to pare almost half their Systems down and then they had Massive Passenger losses that they did not loose for 3 years after the merger.
Put it to you in Terms anyone could understand They were a couple making 50K a year spending 90K a year and living on Credit Cards and then when the Credit cards came due they would get another one with a bigger Credit limit. Basically think the Goverment except the Goverment has NO LIMIT.
Oh dear, I have to disagree and correct daveklepper, who I admire and respect. It’s about the “Titanic” rivet comment. No-one substituted iron for steel rivets, they were ALL iron rivets, just as the hull plates were iron. A VERY high grade of rolled iron, but iron just the same.
You see, “Titanic” was built of the best matierials available at the time. Would those matierials be used today? Certainly not, but Harland and Wolf, the shipbuilders, were a class act and used the best stuff they could get.
In the end, it wasn’t poor matierials, poor workmanship, or poor engineering that caused the sinking. It was poor seamanship that killed “Titanic”. Take it from someone who’s been a “Titanic” freak since he was 10 years old.
Sorry to set this topic “adrift”.
Oh, as for Al Perlman: He SAID the merger of the Pennsy and the NYC was a bad idea, but no-one listened. No-one could have saved Penn Central.
What if Jay Gould had run the ICC when its powers were at their zenith?
I agree with others…no one could have saved Penn Central. When the New Haven was thrown in as a condition…it sealed the doom, which was pretty well cast anyway.
Declining freight base, high passenger costs, commuter service, 5 man crews, low volume branch lines, deferred maintennace, high property taxes, mismanagement, etc.
It was time to reboot.
ed
And Conrail and other Eastern rails were probably doomed by redundant routes, too. How many lines from metro NY to Buffalo? NYC, the old West Side line, LV, DL&W, Erie, for declining traffic. Chicago to NYC? NYC, NKP/Lackawanna or LV, Erie, PRR, B&O. Albany to Boston? B&M and B&A. The list goes on and on between city pairs.
From what I’ve read, Perlman didn’t think PC was a good idea from the get-go. I could never figure out why he didn’t leave at the start-up of PC, or at least when he was given the opportunity several times before it crashed. I seem to recall that Saunders tried to push him out the door a couple of times.
If you need proof of any of this, the condition of pre-Staggers Conrail in 1979 is it. All the deferred maintenance had been taken care of. Welded rail all over the place. Lots of new locos. Lots of traffic. Smoothly running yards and shops.
Red ink for the year. One droplet of black ink in the second quarter. FAIL.
Ah, the “what if’s”! We shall never know, of course, but what if … Stuart Saunders hadn’t “sold out” on the labor terms governing the PC merger, gutting virtually the entire rationale for the merger? Al Perlman would never have done that … What if … Stuart Saunders hadn’t ignorantly boasted to the world that he would put the two railroads together “in 100 days”, then even more incredibly insisted that managers attempt to do it? Al Perlman was a railroader, Saunders was a poseur. What if … Saunders hadn’t “overseen” (laughably) the merger “planning process” which resulted in incompatible computer systems driving operations into gridlock in a matter of weeks? Al Perlman undestood “cybernetics” as the heart and soul of an effective and efficient railroad operation, and he would never have stood for such folly.
Sunders was a political creature who knew next to nothing about managing a complex network, yet because of his political “skills” he out-maneuvered Mr. Perlman to become head of PC. Suanders “leadership” drove PC into bankruptcy at an incredible pace, as Mr. Perlman’s innovative “green team” was immediately marginalized and its members moved on to “greener” fields in mere months. We will never know the details of why Mr. Perlman, the ultimate railroader of the time, was sidetracked, but it was a classic blunder by the boards of directors to have consummated the merger with Saunders at the throttle.
As for those grim externalities so often mentioned … 1966 was the best year for U.S. railroads since WW II, so, yes, the recession of '67 was a problem for the merger (Feb. 1, 1968) but growth resumed rapidly. Sure, passenger trains were a drag, but the “Twentieth Century Limited” was already dead, and other train-offs were occurring steadily. Truck competition, sure. Declining industrial base, yep. But Al Perlman was attacking those challenges successfully: Flexi-Van; Flexi-Flow; and a host of genuine marke
466lex- You bring up a good question. How did C&O and B&O survive the same storm PC was in? Is the answer coal?
It has been pointed out that PC got most of the passenger problem while C&O/B&O and N&W got most of the coal.