Invisible Giants: The Empires of Cleveland's Van Sweringen Brothers

5. Shaping Solid Forms

48 • Invisible Giants Five Shaping Solid Forms Ownership of the Nickel Plate immediately brought the Vans and Bernet financial, physical, and commercial challenges. In order to make the financing of the leveraged holding company work, the railroad had to produce at least enough dividends to cover the interest payments to the Nickel Plate Securities Corporation’s preferred stockholders, and it had to do so quickly. Not surprisingly, the Nickel Plate resumed paying full dividends in January 1917 after two years of somewhat erratic payouts; it now needed to stay on solid financial ground and grow. Doing so was not so easy. The Nickel Plate had been born with some congenital weaknesses, and the Central had done little to overcome them. Its physical facilities were limited; it was a single-track railroad with short passing sidings and small yards. And although most of its locomotives were fairly new, they were of obsolescent designs unsuited for heavy main-line hauling. So while the railroad was busy enough, its short trains made it inefficient and expensive to run. Shaping Solid Forms • 49 More worrisome over the longer range was its ability to generate new business. The Nickel Plate of 1916 consisted of only a single Chicago–Buffalo line that had no traffic-gathering branches and few industries located directly on its own tracks. For the past three decades, it had slogged along mostly by moving business between connections at Chicago and other connections at Buffalo. With its main line relatively uncluttered by yards and industrial switching, it offered a fast service and thus got a share of premium shipments, such as meat, that might have gone over the New York Central. But this was a fickle kind of traffic; without plants on its line, freight customers had no direct ties to the Nickel Plate and could easily be wooed away by someone else. And without much traffic that it could control, it had little bargaining power with its connections , who could feed it or not depending on their own selfinterest . Bernet proved to be anything but a plodder. His previous employer was an industry leader in collecting operating talent and developing locomotives, and he moved quickly to bring the New York Central style to the Nickel Plate in the form of young, talented Central men. In October 1916, he brought in an old Central associate, 37-year-old A. R. “Gus” Ayres, as his motive power superintendent; a month later, he persuaded a fellow Lake Shore & Michigan Southern alumnus, Charles E. Denney (also 37), to serve as his top engineering assistant. He picked well in both cases. Ayres became the Nickel Plate’s general manager in 1927 and specialized in moving fast freights with cutting-edge locomotive technology; by 1920, Denney was its operating vice president. He soon moved into the select circle of senior Van Sweringen railroad operating managers, ending his career as president of the Vans’ Erie Railroad.1 A quick and fairly easy way to boost the railroad’s profitability was to move longer freight trains faster. Ayres immediately went to work to upgrade the Nickel Plate’s teakettle motive power. Shamelessly borrowing the Central’s latest locomotive designs, he bought thirty-five high-capacity Mikado freight engines and a fleet of modern switchers. At the same time, passing sidings were lengthened, an intensive rail replacement program was started, and some bridges were upgraded .2 A bit of the Van Sweringen personal touch quickly showed up on the railroad as well. A project to eliminate two-and-onehalf -miles of street grade crossings through Cleveland’s builtup West Side had been waiting in the wings since 1910 and was finally started in 1915—paid for mostly through a city bond issue. As it got underway, the Vans made sure that the 50 • Invisible Giants right-of-way and street overpasses along the route were designed to accommodate two additional tracks for a future rapid transit line through that populous part of town.3 The war brought the Nickel Plate a healthy new rush of business but also led to some severe wobbling of the Vans’ financial tightrope—and some frustrating delays on their various building projects. Unfortunately, the country’s railroad system—which was made up of hundreds of private companies with widely varying financial strength and physical resources—was not prepared to handle the sudden and huge influx of troops and war materiel heading east for overseas...