The decline of passenger railroading began following World War II, as traffic dropped significantly, even while railroads began to update their passenger fleets with new equipment in the 1950s hoping to retain passengers and ward off ever increasing competition from the automobile and airplane (the development of jet propulsion only worsened the situation). Technically, passenger rail travel peaked in this country during the first two decades of the 20th century and slowly declined thereafter, particularly with the onset of the Great Depression. However, it also did not help that President Dwight Eisenhower enacted the Interstate Highway System in 1956 (also known as the National Interstate and Defense Highways Act). By that time railroads were beginning to see the writing on the wall and cutback their services, with most giving it up altogether by the start of Amtrak in 1971.
Our high speed four lane corridors that we take for granted today did wonders in helping to improve travel but it was essentially the death blow for the “Golden Age” of passenger rail travel as people took to the highways in even greater numbers. While new equipment in the 1950s helped bring back some passengers, overall the returns fell extremely short and in the end it only proved to be a costly waste of money as the decline only continued. To make matters worse railroads were also losing a larger share of their bread and butter service, freight traffic to trucks that now had a high speed, free, and well maintained four-lane highway system to move goods. While trucks are always more efficient at moving short-haul freight the new Interstate system was also taking away a larger share of the railroads’ long haul traffic.
For instance, by 1950 passenger revenue was 10 percent of freight revenue when in 1920 passenger revenue had been 20 percent of freight revenue. While passenger trains are rarely profitable, before the 1950s railroads were earning enough that their freight revenues could easily offset the losses. Also, in just a decades span between 1947 and 1957 operating mileage by passenger trains dropped from 160,000 (1947) to 112,000 (1957) and would continue into the following years.
It can be said (which is true) that one reason for the decline and the “depression” of the railroad industry as a whole, which occurred beginning in the 1950s until deregulation in 1980, is the result of severe sanctions and regulation by the Interstate Commerce Commission (ICC). However, the railroads also, in a way, caused their own downfall by the shoddy and monopolistic practices they took part in during the 19th and early 20th centuries (which resulted in many of the regulations imposed on them). A few stats regarding the decline during these years:
· Between an 18-year span following the year after World War II, 1946, passenger traffic declined from 770 million to 298 million by 1964.
· By the 1950s total industry losses on passenger rail service was over $700 million.
· Commuter trains declined by 80% from over 2,500 in the mid-1950s to under 500 by the late 1960s.
In any event, by the 1960s three things were clear about the decline; one, because of the heavy regulation laid down on the industry it was no longer a threat to take part in such shoddy practices; two, because railroads were forced to provide passenger service, which by now was only severely draining their profits if something was not done the industry would be near total collapse; and three, because of these heavy losses railroads desperately wanted to cut whatever they could to save money (which was tough considering heavy regulation forbid them from abandoning rail lines, canceling a passenger train[s], laying off workers, or raising/lowering freight charges all without ICC approval). As a Boston & Maine official was once quoted as saying, "Every rate case has become a carnival of oratory." The 1960s also saw the end of the government’s lucrative mail contracts it held with the railroads and only furthered the decline as its loss was a severe blow to passenger traffic earnings.
Relief for passenger operations would finally come in the way of the National Railroad Passenger Corporation, or Amtrak, signed into law by President Richard Nixon as the Rail Passenger Service Act and the new carrier began operations on May 1st, 1971. Government-controlled (all common stock is federally owned) and funded, Amtrak operates almost exclusively over the private freight railroads, save for the Northeast where it owns the [mostly] PRR’s former Northeast Corridor (NEC), a four-track main line operating between Washington, D.C. and Boston. In total Amtrak operates roughly 21,000 miles of track.
When Amtrak began operations railroads were asked to provide two things to the upstart passenger carrier; one-time payments, which would eventually total $190 million (from 13 railroads), and equipment (of note not all of the major Class Is elected to turn their operations over to Amtrak because they either felt that they could provide better service themselves or were not financially capable of doing so [such as in the case of Rock Island]).
In all, the equipment Amtrak would receive included 300 locomotives and over 1,200 cars. From a railfan perspective perhaps the most interesting time to watch Amtrak was during these early years when a train’s equipment hosted an entire assortment of liveries from railroads all over the country. On the contrary, however, it was also disappointing to see a number of famous trains discontinued or canceled with Amtrak’s upstart. While Amtrak was initially intended to become self-supporting (an improbable notion to begin with, passenger rail is rarely profitable) it quickly became obvious after its first year of operations this would not be the case.
In its first year Amtrak earned $163 million with expenses of $310 million. By 1980 things were not much better as the carrier saw $454 million in revenues and $1.08 billion in expenses. Even though the decline of passenger railroading took place after World War II, until Amtrak’s creation in 1971 the carrier has been steadily improving and just in 2007 broke its all-time ridership record. For more on Amtrak regarding its early years through today please click here.