Photographs & History

Photographs and History

40 Years | A Brief History of Conrail

Two Conrail trains part ways at iconic Horseshoe Curve west of Altoona, Pennsylvania on the former Pennsylvania Railroad mainline over the Alleghenies, October 21, 1988. Image courtesy of Mike Danneman

Two Conrail trains part ways at iconic Horseshoe Curve west of Altoona, Pennsylvania on the former Pennsylvania Railroad mainline over the Alleghenies, October 21, 1988. Image courtesy of Mike Danneman

At the close of the 1960’s railroads of the Northeast struggled with mounting debts, declining traffic and deferred maintenance. Coal, once the railroads mainstay traffic source, took a nosedive as the nation’s appetite for oil increased, triggering financial panic among many rail carriers in the Mid-Atlantic. The Pennsylvania Railroad and New York Central, once bitter rivals, merged into the Penn Central creating perhaps the most infamous face for the ensuing financial disaster seven major carriers faced in the early 1970’s. In order to avoid the complete collapse of railroading in the east, congress enacted the Regional Rail Reorganization Act of 1974 (commonly referred to the 3R Act). The Act provided interim funding for the struggling carriers while creating Consolidated Rail Corporation, a government funded private company. Under the Act the United States Railway Association prepared a plan to determine what lines of the seven carriers would be incorporated in the final system plan to be transferred to Conrail. This plan would be approved by congress under the subsequent Railroad Revitalization and Regulatory Reform Act of 1976 (4R Act) which was signed into law in February of 1976.

The original Conrail system map circa April 1st, 1976. Note the absence of the iconic Conrail logo. Collection of the Multimodalways Project

The original Conrail system map circa April 1st, 1976. Note the absence of the iconic Conrail logo. Collection of the Multimodalways Project

Conrail was incorporated in Pennsylvania the same month and began operations April 1st 1976. The company’s function was to revitalize freight service between the Northeast and Midwest, operating as a for-profit operation. In 1981 Conrail’s economic standings began to turn around showing its first profit since incorporation. Under the leadership of L. Stanley Crane, a former Southern Railway CEO, the railroad flourished, shedding an additional 4100 unprofitable and redundant miles from the system between 1981 and 1983. The Staggers Rail Act of 1981 also provided much needed deregulation of railroad rates and tariffs allowing for changes in rate structuring that dated back to the turn of the century, giving railroads the ability to better compete with trucking companies. By the time Conrail approached its 10th birthday the railroad was ready to return back to the private sector. In the fall of 1986 congress signed in the Conrail Privatization Act authorizing a public stock offering that resulted in one of the largest IPOs in US history raising $1.9 billion in 1987.

Tony Palladino worked for design firm Siegel & Gale when he developed the iconic Conrail logo and identity, shown here in a lettering diagram. Collection of the Milton Glaser Design Study Center and Archives. 

Tony Palladino worked for design firm Siegel & Gale when he developed the iconic Conrail logo and identity, shown here in a lettering diagram. Collection of the Milton Glaser Design Study Center and Archives. 

Conrail’s ubiquitous blue locomotives and “can opener" logo developed by designer Tony Palladino became the symbol of a profitable network, a success story for a new era of railroading which also saw the creation of Norfolk Southern and CSX Transportation. Ironically in the 1990’s NS and CSX engaged in a takeover battle that would have created an unhealthy imbalance in northeastern rail service, the compromise was instead a split of the Conrail system. CSX would take 42% of Conrail’s assets and the former NYC properties with NS assuming the 58% balance and much of the PRR network. Interestingly enough, the final split of Conrail is similar to a merger proposal from the 1950’s in response to the proposed marriage of the New York Central and Chesapeake & Ohio. The PRR had looked to join forces with the N&W and Wabash, both of which it already had a controlling interest in. Regardless, the ICC rejected both mergers but the net result some fifty years later is the same. Outside of the major split of Conrail assets three terminals where competition was in jeopardy continues to be serviced by the jointly owned Conrail Shared Assets Operation, providing equal access for both railroads in Detroit, Northern and Southern New Jersey/ Philadelphia continuing the Conrail name that began operations 40 years ago today.