The Union Pacific - Southern Pacific Merger of 1996

-- Don Phillips Foreshadows a Near-fatal Error by Union Pacific --

No one who was watching the western railroad mergers of the 1990s can escape two incontrovertible facts.

First fact: BNSF could have kept the still-immensely popular Warbonnet paint scheme. The cost of finding a UV-resistant red and yellow would have paid for itself in public relations and railfan revenue in months if not days

Second fact: the Union Pacific and the Southern Pacific merger, while seemingly necessary, nearly destroyed the combined railroad

The first fact remains most vexing for railfans. Conversely, the second fact was more acutely felt and certainly was the most vexing problem for people dependent on the industry.

circa 1995

The ingredients for the problem were evidential but not entirely foreseeable, as Don Phillips wrote about them almost a year before the merger. In Trains magazine dated November 1995, he forecast a pile of bodybags for San Francisco and Denver, among other places. He claimed that the time of the "mega-merger" was really a time of the mega-takeover and that we would have four or "perhaps only two" massive rail systems.

While I am relieved to say the big four remain, his warning about the need for bodybags proved true. He wrote,

UP has the management talent and strength to simply wipe out SP management if it wants to (which it probably does).

The newly combined UP-SP organization functioned for hours and that was all it took for problems to surface. Yards began to fill as dwell time increased. As weeks and months wore on, it only got worse Trains sat for days in sidings outside hubs with customers screaming for their goods that were so overdue, proverbially the ⌛ hourglass was supplanted by the 🗓️ calendar.

The cause of these delays was hinted at by Phillips in that same editorial. He wrote:

It has always been one of railroading's mysteries as to why SP has remained railroading's weak sister despite serving some of the country's most lucrative territory -- California and the chemical coast of Texas and Louisiana.

Incidentally, Phillips also mentions that it was a real question of what would happen to the Western Pacific and Denver & Rio Grande Western routes. He added that BNSF would certainly want them either via trackage rights or outright acquisition. It may have turned out better for the Tennessee Pass if the latter had proved true. If only we could have seen a Conrail-like split out west!

In any event, I watched as it would take years for the UP merger takeover of SP to truly work out. In the simplest terms, it was a case of chemistry where Union Pacific's management crossed with Southern Pacific's infrastructure with explosive results.

More to the point, it was where a new owner took over old and different plant without truly understanding the differences of infrastructure. Like putting Windows on a Mac or Android on an iPhone, the system choked and failed to run. Worse, because the SP management was largely ushered out, there was no brain trust to help understand the how and why things were done before. Unfortunate, but it does hold value for those who want to learn their lessons from history and not necessarily from experience.

Caboose Hobbies To Re-open In Lakewood

Caboose Hobbies, in whatever form the store survives, is set to re-open on Alameda Avenue in Lakewood just south of the Federal Center this month. The Denverite has more.

When the store closed at its original location on 500 S Broadway on September 11, 2016, it was the end of an era. The largest model train store in the world closed on the 20th anniversary of the Union Pacific - Southern Pacific merger on September 11, 1996.

While Denver Billionaire Philip Anschutz had purchased the Rio Grande in 1984, he had Rio Grande Industries purchase the Southern Pacific Transportation Company in 1988 and the two companies functioned as separate divisions of the same railroad. As a result, it was easy for me to imagine nothing had really changed. Unfortunately, the day everything changed was the merger of the Union Pacific. For me, that was the day the Rio Grande, Denver's home railroad finally died.

So it's a little more sad than before. On the other hand, it would feel even worse if Caboose Hobbies had closed forever. Now she has a fighting chance. When they open, drop by 10800 W. Alameda Ave, Lakewood, Colorado if you are in town! They should be are not (yet) open. If you are out of the metro area, visit www.caboosehobbies.com! They should have gift certificates for sale!⚒

Burnham Shops In Final Countdown To Closure

For more than 140 years, the at-first narrow gauge Denver & Rio Grande Railroad and its standard gauge successors have maintained a locomotive maintenance facility and yard at 8th and Pecos in central Denver. In less than 3 weeks, that facility will turn it's last wheel.

Such news is a bitter pill to take.

It's no secret that declining coal traffic in Colorado and the unlikely prospect of its revival, at least in the domestic sense is driving the business decision. Nearly a year into a continuous drop in earnings, Union Pacific isn't shy about falling back on the tried and true method of shoring up a soft bottom line by consolidating operations and reducing expenditures. The bitter pill is the number of "relocated" jobs--at least 210--and the location, which is to some Rio Grande fans, sacred ground.

In his comments on the Denver Post news article announcing the closure, rail historian Dillon A. wrote

I propose that the Burnham yards be put on the Register of Historic Places. This facility is where hundreds of thousands of steam and diesel locomotives were overhauled and repaired. A good example of why this needs to be saved and saved NOW are one of the locomotives that came from this facility. These locomotives still survive on the Cumbres & Toltec scenic Railroad in Chama, New Mexico, Durango & Silverton scenic Railroad in Durango, and one at the Colorado Railroad Museum.  ... These locomotives were the narrow-gauge K-37 class of the Denver & Rio Grande Western. Out of 10 made, 8 still exist and one is currently operational. #491 is operating at the railroad Museum in Golden. These locomotives are the greatest example of the power and craftsmanship that this facility produced. That is why this facility needs to be saved NOW. It might just look like an old rail yard, but it holds MANY secrets and hold LOTS of opertunity [sic] for future historic rail preservation.

While my heart strongly echoes these sentiments, interested parties must either hastily coalesce into a preservation group or contact the existing preservation organizations like the Colorado Railroad Museum or History Colorado to get involved. Otherwise, we have little right to complain. 

At this point, UP spokeswoman Callie B. Hite says the railroad plans to prepare the 70-acre locomotive repair yard for sale. There are about two dozen buildings on the site, which is zoned for industrial uses. "The 70-acre property is located in an area experiencing renewed urban development," Hite was quoted in the article.

Opinion

More than 20 years ago, I can remember gliding past the "dead line" on neighboring tracks operated by Denver's pilot Light Rail line, scrolling past the many Southern Pacific and Union Pacific locomotives, searching intently for a Rio Grande in among the dirty grey and dingy yellow engines awaiting their fate to be rebuilt or sold. It's hard to imagine that the next time I do ride past, the dead line, shops and structures could be all demolished and plowed under for a scenic strip mall or trendy retail "infill." This was a place that birthed the Rio Grande's narrow gauge conversions, refit and rehabilitated the mighty 2-8-8-2's and their kin during the heyday of steam and rebuilt and repaired the generations of diesel locomotives that defied gravity over the spine of the continent. For generations, men punched in, endured hours of hard, sweaty work in grimy iron horses, some loving every minute of it. Their sons and grandsons remembering their work with pride. This place probably will now be re-developed and paved over with not even a hint that such history transpired there, except perhaps the irony of the same name, Burnham Shops.

If you disbelieve me, consider that today's Elitch's was in 1993 a very different place, the Colorado & Southern yards. Abandoned and quiet, they still had history waiting inside structures that had stood for decades. In two years, the only hint that remained of it's railroad past was a heavy, through-truss turntable, and in only a few more years, it was gone, replaced by a mediocre bat swing ride. It became a forgotten corner in a park that itself has suffered under a series of lackluster owners and stagnant growth after moving from it's own home in 1994 over a century old in the West Highlands of Denver. Is that really what should happen to Burnham?◊

POTD: Brawny Muscle At Mitchell On Tennessee Pass

Perhaps nowhere--at least not in the last 40 years--is the idea of railroading in Colorado more realized than Tennessee Pass. A former narrow gauge route surveyed as a way to reach the riches of Leadville's mines and supply them, punched through the summit with a tunnel bore and classic lopsided profile of 1.7% grade on one side and 3% on the other, Tennessee Pass runs right through the heart of the state and until the Union Pacific merger in 1996, served with distinction as the highest mainline in the nation.

Photo of the Day: Mike Danneman

A whopping ten units on Tennessee Pass pull and shove their coal train up 3% grade at Mitchell, Colorado, September 5, 1995. With new AC4400CW and two manned helper sets, Mr. Danneman says, "This was Tennessee Pass at SP’s best!" It's hard to disagree, Mike.◊

PS: For those interested, Fred Frailey (one of the best) writes about the Long Autumn of Tennessee Pass in his blog at Trains magazine (2012).

POTD: Shamrocks, Clovers, Three Days Are Over

Mike Danneman, whose photos are 3 for 3 this week on POTD, has delivered a fine string from his flickr account. The St. Patrick's Day theme this week has been pretty fun ...for me, at least! Monday, the obvious connection was the green locomotive. Tuesday was less obvious with Rio Grande's last 3 locomotives pulling together as a single unit, a subtle nod to Patrick's use of a shamrock (similar to clover) to teach the concept of the Trinity to his friends. Today, it's even more obscure for those who don't know their Irish lore.

Southern Pacific never looked better than August 1, 1999, squeezing between rockfall fencing
and rafters intent on enjoying Browns Canyon and the Arkansas in the short summer season.
Photo: Mike Danneman

Yes, in one of the crueler changes of the UP-SP merger (also mentioned all 3 days, unintentionally), the snaking coal drags and other serpentine trains that plied the Tennessee Pass route have vanished. Tennessee Pass was the original standard gauge route "Thru the Rockies" before the acquisition of the Denver & Salt Lake by the Rio Grande and it's official merger in 1947.

Today's photo is perhaps as exceptional as they come. Thank you, Mr. Danneman, for sharing these with us!◊

POTD: 3 In A Row - The Rio Grande GP60's

In his second appearance this week for POTD, Mike Danneman is an accomplished railroad photographer whose work shows up in books and Trains magazine with enough regularity that many photographers might envy him. Of course, he has a way of being in the right place at the right time!

GP60s 3156, 3154, & 3155 lead SP and UP locomotives head north toward Blue Mountain Crossing
between the Big Ten curves and Tunnel 1 west of Denver on its way to Salt Lake City, Utah.
Photo: Mike Danneman

As an example, he captured today's Photo of the Day in the foothills west of Denver as the three GP60s of the Rio Grande--the last locomotive units ever--hauled the Denver to Roper (Salt Lake City) manifest train up the grade toward the Moffat Tunnel on the old Denver & Salt Lake. In an interesting twist, it would seem a the six locomotives formed a recapitulation of 60 years (roughly) of the Rio Grande's ownership history with itself, Southern Pacific and Union Pacific. Regrettably, all three locomotives have been repainted or renumbered, per Utah Rails, but all are still active within the last year.

There is no doubt that it's a late 90s Denver skyline, is there?◊

Video - Gerald Sharp's Run 8! Roaring EMDs On Tennessee Pass

On long, windy, winter nights, videos from summers past remind me that there are warm summer days still to come in Colorado, even in the high mountain parks and peaks, canyons, valleys and playful creeks. Only a few months remain to plan our trips to the tracks, even if it's a daydream of a trip. Winter's hold still lingers, and while it does, we can watch videos both historic and recent.

Gerald Sharp recently uploaded a Gerfmon production titled Run 8! Roaring EMDs On Tennessee Pass, Colorado 1992. Although it's considerably lengthy at 34 minutes, it may turn out to be worth your while. The video follows two trains on two different days as they take on helpers at Minturn, Colorado and proceed up the 3% grade to the summit tunnel atop Tennessee Pass, between Eagle-Vail and Leadville.

If you are short on time, the highlights include: Rio Grande SD40T-2 and GP40s pulling out of Minturn, Rio Grande manifest rounding a curve eastbound ascent, and one long, continuous shot of an SP manifest with TOFC through a high mountain park. Really, though, the whole video is worth your time, especially to see the helper operations. (Oh, Lord!)



As long as you're here, I have a small but growing number of playlists the CR YouTube channel. Enjoy!◊

POTD - Vanishing Color: Summit Tunnel

Once upon a time, not so long ago, there were four western Class I railroads. Instead of yellow or orange locomotives, there were green ones, red ones, grey ones, blue ones and even a few left over from the previous mergers. It was a much more colorful west. Strangely, others who remembered further back bemoaned the lack of diverse colors even then. We don't know what we have until it's gone. This week's theme for Photo of the Day (POTD) is vanishing colors.

Monday's vanishing colors POTD is one from "Slideshow Bruce" Fingerhood titled "summit tunnel," Early afternoon sunshine highlights half the nose of the southbound unit, yielding a nice contrast between the left and right sides and also to the smoky confines from which the unit has just emerged. This is one of the better photographs from this now silent location. Perhaps the most recent loss of color, the UP-SP merger would shutter the Tennessee Pass route from Dotsero to just west of Canon City and cover Rio Grande gold and black EMDs and Southern Pacific gray and red GE locomotives with Armour yellow paint and patches.

Southern Pacific locomotive 175, a GE-AC4400CW heads down from the summit of a
still-active Tennessee Pass in June 1996. UP would complete the merger in mere months
Photo: Bruce Fingerhood

POTD - Minturn Years Later and Months Before

We are in Minturn for the second time this week for Photo of the Day and our theme of Tennessee Pass. This time, however, we are only a few months away from the Southern Pacific merger with the Union Pacific, 5 years to the day before 9/11.

The sun glares off the remarkably clean and unaltered nose of Geep 3099 as
she leads a colorful consist and train into the yard at Minturn in July 1996.
Photo: John Jauchler

POTD - Silent Testimony in Buena Vista

Editors note: POTD continues, but after today, most will have a photo and a brief caption without the essay. Essays need to be fact-checked for accuracy, each of which can require significant blocks of time.

Life in Buena Vista since 1997 has been considerably quieter than the previous century, thanks to the Union Pacific's decision to mothball the Tennessee Pass route in favor of the Moffat Tunnel route. It's been considerably cleaner, as well. In the 40s and 50s, the Rio Grande's monster steam engines caused a smoky haze to hang over the entire Arkansas River valley, causing respiratory issues for soldiers training at nearby Camp Hale.

Such days seem foreign to the summer scene below captured by Adam Lutt. The Rio Grande bridge has eluded the paint cans of Southern Pacific and--thus far--Union Pacific. The former main line has sat dormant for so long that nearly all the kids in this scene have never seen a coal or TOFC unit train come through this valley. The thrum of diesel engines, the rumble of a rail grinder, and the chuffing of iron horses are all as foreign as can be from this simple day playing in the creek, their echo fading from human memory as the paint slowly fades from the bridge above. It's only a matter of time before the railroad vanishes completely from Tennessee Pass, a matter of time, and money, unless a client develops on these once-heavily traveled rails or Union Pacific gets serious about preserving and maintaining their future options. Yet if they do, they could just as easily paint over the bridge's Rio Grande lettering altogether, disturbing the nostalgic reverie of Grande Fans like me.

I think I'll go skip a rock.

Locals and their guests play beneath a railroad bridge of the Rio Grande in a tame
and cool Arkansas River in Buena Vista, strictly a summer activity in Chaffee County
Photo: Adam Lutt

POTD - Big Ten 16 Years Ago

Denver's altitude is 5,280 feet above sea level, earning it the obvious moniker, the Mile High City. The railroad route directly west was built as Denver, Northwestern & Pacific Railroad and came to be owned by its successors, Denver & Salt Lake Railroad and Denver & Salt Lake Railway, as well as Denver & Rio Grande Western, Southern Pacific, and lately, Union Pacific through a series of mergers. It's apex was first at Rollins (Corona) Pass at 11,680 feet ASL and then inside  Moffat Tunnel at 9,239 feet. Making up the difference (6400 and 3959 feet respectively) while at the same time keeping the gradient manageable and cost efficient was a balancing act that meant gaining altitude as evenly as possible. If there was a ramp of earth, much like Sherman Hill in Wyoming, the construction engineers would have had little trouble. As it was, construction from Denver into the foothills was the most difficult part. They had to claw and scrape for elevation to reach Boulder Canyon and the Flatirons. A tongue of land jutting out from the foothills became the stepping stone between the western high plains and the east face of the Rocky Mountains. The long, winding turns climbing onto and upon the butte are both ten degrees curvature, thus named the little ten and big ten curves.

On April 8, 1995, a Southern Pacific coal train descends through Big Ten and
approaches Little Ten curves west of Denver, 18 months before the UP merger
Photo: Rolf Stumpf

Buffett Buys BNSF

Financial emperor Warren Buffett has been buying up BNSF shares for years, but even in the first 48 hours since the announcement, this much is known about Berkshire Hathaway's $34 Billion purchase: Buffett is betting the farm on American rail.

Buffett believes that American coal will continue to produce in the long term, carried by Rio Grande-like unit trains from western sources such as the Wyoming and Colorado coal fields. He also believes that the American economy will rebound, once again driving demand for cheap and easy imports from China and the Pacific Rim to Wal-Mart and Sears aboard BNSF container trains from Washington and California ports.

Little if any impact is expected at the operations level. In a letter to BNSFs customers, John Lanigan stated,

You will not see any changes in the weeks and months ahead. Our leadership will remain in place and focused on providing value to our customers.

BNSFs Ft. Worth, Texas-based operations will remain in Ft. Worth. Largely, this looks like a move that's behind the scenes. The funny thing about those behind-the-scenes moves, however, is that they have an uncanny way of driving long-term strategies. Is this the anticipated move that sets the "fabled" next round of mergers in action that pairs BNSF and UP with their East Coast counterparts CSX and NS? What would this mean for the plans of high speed rail? If mergers happen, they will happen in the next 12 months. That's just a hunch based off the last round in 1995-96 where Conrail was divided up between CSX and NS and BN and Santa Fe merged, forcing UP to buy Southern Pacific from Colorado's Phil Anschutz.

5371 Moved To Ogden UT

The Union Pacific purchased the Southern Pacific in 1996. Since then, UP had pursued a re-painting and patching program that actively worked to assimilate all locomotives gained through the purchase. The Denver & Rio Grande Western had purchased the SP years earlier in 1988, but kept the SP name because SP was the larger of the two railroads. As such, many Rio Grande locomotives were kept in their original livery. Then the UP applied its Armour yellow to many of the SP and DRGW units, some in total repaints, many others in patches applied during regular maintenance sessions. The patches were an adhesive decal plastered over the numbers below the cab window, turning a blind eye to aesthetics in an effort to assimilate all road power into one uniform numbering system.

The refugees from this program concentrated in places like Helper, Utah for years, soldiering on as helper units or local power for years, proudly wearing the unspoiled colors of their former road. Alas, one by one, they too fell under the curse of the patch, until only one Rio Grande unit remained: SD-40T-2 unit 5371. Strangely, the unit was spared, continuing to work out of Helper until its motors failed. Sadly, it was hauled dead in tow to Cheyenne where it was the subject of much speculation. Rumors that it had been promised to Ogden, Utah for display at Ogden Union Station have now proven true. Photos of the unit have been posted to TrainBoard.

Rio Grande Ski Train Sold, Moved To Canada

It is with great sadness that I report that the Ski Train has been sold and will no longer operate in Colorado.

I'll let that sink in for a moment. The last remaining standard gauge operation that was truly a Rio Grande original is now gone. Started by the Denver and Rio Grande Western in 1940 as a means of getting the residents of Denver to their city-owned Winter Park ski area, the train operated over 69 seasons. It originated at Denver's Union Station and dropped skiers off for a day of skiing after emerging from the Moffat Tunnel, just 12 years old in 1940. The train would be wyed at Tabernash and wait in the siding at Frasier until the day came to a close, when it would return to the same curve and pick up happy and tired skiers for a relaxing ride home.

In 1984, Denver businessman Phil Anschutz purchased the Rio Grande and then in 1988, purchased the Southern Pacific Railroad (SP), merging the two under the larger railroad's name. As part of the deal, a subsidiary of Anschutz Company would buy the Ski Train and operate it as a separate venture. They continued losing some money in the venture, but it was something they "wanted to do," according to company spokesman Jim Monaghan.

As for the reasons leading to the sale of the historic train, it was a combination of things. Monaghan cited four problems faced by the Ski Train, in no specific order.

1. overall cost increases, particularly for liability coverage
2. operating issues with freight trains over the route owned by SPs successor, the Union Pacific railroad
   
3. uncertainty surrounding the redevelopment of Union Station and the Ski Train's place in that development (I blogged about this here)
   
4. a weakened overall economy

While no control can be exerted over issues 1 and 4, issues 2 and 3 should have been mitigated or resolved before the sale became an option. One could wonder if issue 2 was a monster of Anschutz's own making when the company sold SP to Union Pacific in 1996. The Union Pacific is no lover of passenger trains, as riders of Amtrak over the years can readily attest to. By losing ownership of the route, Anschutz lost control of whose trains get priority treatment. Additionally, recent maneuvers by the Obama administration and a Democrat-controlled congress have put pressure on the Big Four railroads to make Amtrak trains on their routes a priority, resulting in better on-time performance for Amtrak. This is all well and good, but could this well-intentioned maneuver by the government have lead to the California Zephyr taking the Ski Train's priority ranking over the crowded Moffat Route? It's a logical possibility, as the Amtrak effort coincided with the end of the 2009 Ski Train season. The sad irony is that by pushing state-sponsored trains, Obama and company are sending the capitalist private-sector trains to the scrap yard or, in this case, out of the country.

Issue 3 appeared on this blog back in January. As I said in the post,

RTD feels a "social obligation" to it, but that's different than a contractual obligation. Where do the skis, poles, boots and people go if the platforms are spoken for by the local commuter train to Brighton? Putting more cars on I-70/US 40 to Winter Park is not an option.

Now it appears that the non-option is the reality. Since the RTD announced plans for redeveloping Denver's Union Station, they never publicly specified where the Ski Train would fit in the plans. Translation: The Ski Train is not welcome. The cars on the pavement in Denver are now being moved to the mountains by the neglect of an agency designed to improve transportation in Denver. Parasite or patron, Denver has historically shown that it is for Denver's cause above that of Colorado in general, and this fits right in.

This is indeed sad news. At the age of 69, a wonderful train is being sold off, with no replacement in sight.

HT: Kevin Morgan

WeCo NRHS To Host UP Locomotive Engineer As Guest Speaker

The Western Colorado Chapter of the National Railway Historical Society (WeCo, NRHS) is bringing in a Union Pacific locomotive engineer for its February 4th meeting at 7 p.m. at the Glenwood Railroad Museum. This meeting is open to the public. Steve Wareham, 16 years an engineer for UP, has been active in Operation Lifesaver Colorado and will be on hand for a question and answer session.

SP 1744 Steam Locomotive To Run On La Veta

It appears the San Luis & Rio Grande Railroad just completed the purchase of former Southern Pacific Railroad standard-gauge steam locomotive #1744. This engine was listed recently for $800,000 by Ozark Mountain Railcar.

Built by Baldwin for SP in 1901, the 2-6-o Mogul is an oil burner. She has been reconfigured a few times, including going from compound to simple and having a superheater added and boosting the boiler to 200 p.s.i. After serving mostly in Califronia, her first service life effectively ended September 24, 1956, when SP retired her, placing her in stand-by status because of her good condition. According to Ozark, she saw occasional excursion service until the fall of 1958 when she starred in a feature film, entitled This Earth Is Mine released the following year.

She was donated to the National Society of the Sons of Utah Pioneers on May 9, 1959, where the locomotive was on static display at Corine, Utah along with Union Pacific 2-8-0 #264, sitting pilot to pilot as a representation of "the driving of the golden spike." This was prior to the actual rail park at Promontory, Utah.

She went to the Heber Valley Railroad (the Heber Creeper) in the 80s. According to Christopher Hawkins,

I learned to fire on SP 2-6-0 #1744. At that time, this engine just wasn't a good steamer at all, it's 63" drivers were designed to sprint down the San Juaquin Valley at 50mph, not climb a 2.5% mountain grade at 15mph like we were running her. Even retired SP hogheads [engineers] couldn't get her to steam; damper wide open, damper closed, fire door propped open, blower set for takeoff, she just didn't cooperate, and that made excellent firemen out of us, because there was no mercy, you had to plan ahead for everything. Later, we found that by cutting an auxilliary breathing hole in the oilpan near the burner, it allowed the fire to rise up and fill the corners of the firebox, she steamed like a firecracker after that!

In the 90s, rebuilding began for excursion service in Ft. Worth, Texas but work was not completed until she was sold to the New Orleans and Gulf Coast, a subsidiary of the Rio Grande Pacific Corporation, in 1999. Work was begun in Ft. Worth and a few break-in trips were made before she was shipped to the Big Easy. The next year, she began her work for the NO&GC. All too quickly, the venture folded in a couple of months and the 1744 has been for sale, serviceable, but will need some work before a full season can be expected out of her.

Here's hoping that the 1744 can leave her troubled past behind and begin to boost interest in the La Veta Pass route.

Kyle Plow Train In Action

A plow train for Kyle out on the eastern plains of Colorado busts 20 foot drifts in this awesome 2 minute video. It's hard to ignore this much horsepower, but snow can plow like cement sometimes. FYI, the plow was not permanently stuck.

HT: Friscobob