The Coming of the Chessie System.

The C&O-B&O association grew into an integrated system. The feeling was this new system needed a name.

Back in early 1960’s, when the Chesapeake and Ohio (C&O) was battling for the Baltimore and Ohio (B&O), the C&O’s smart guys had larger ideas for the C&O in mind. Diversification of the C&O was mentioned in the early 60’s at the time the C&O was acquiring the B&O. When the C&O-B&O association flowered into one of a successful, integrated system, there came a feeling to name this integrated system. The story of this success is about the C&O and B&O maintaining their separate corporate identities and growing together – and then people branded it with the most enduring symbol of railroad history – Chessie the Sleeping Kitten.

No merger needed. After the C&O was granted control of the B&O in 1963, the two railroads became more integrated, created a unified management, combined operations, and joint financial statements. The C&O-B&O were functioning as one system. This success was, according to C&O president Hays Watkins, due to the two railroads maintaining their separate identities and using the talents of both C&O and B&O people. Watkins went on to say “there would be no financial benefit from merging.” Indeed, in 1972, the two integrated railroads reported earnings of $60 million ($6.92 per share) and $30 million ($3.42 per share) in 1971. “I’m interested in getting more business at lower prices rather than less at higher prices,” said Watkins. Systems that merged around this time tended to have difficulties, but not the C&O-B&O association.

The obvious new name. This one profitable system that emerged from the C&O and B&O integration prompted some to feel that a common name was needed for the two separate, but integrated roads. In about 1965, there was a survey of directors, officers and managers, who expressed the desire for a single service system, like the Norfolk and Western. Shippers and customers were also consulted, and they gave a recommendation that Chessie be adopted as the symbol of the new age of transportation. Kids were growing up in the 1970s who had never ridden on a train, yet lots of them knew about Chessie. The short name “Chessie System” was given to the two well-integrated railroads that would keep their separate corporate identities. Chessie the Sleeping Kitten would also symbolize the care given to the customer’s freight.

The Chessie System was created to be the parent company for the C&O-B&O system. The Chessie System had “broad and diversified powers as a general business corporation.” This meant that the Chessie System could conduct business in many fields, industrial, mineral, financial, and the like, where the C&O could not because it’s just a railroad. The Chessie System’s board would be made up of the same C&O board members that held the same seats on the C&O’s board. They and parent-controlled functional groups would have access to $2.6 billion that will fuel development and efficient administration.

The new name and parent company brought more than the broad powers of business and assists for the management. It also boosted the spirits of those who drove the trains. Fred Toothman said that the new Chessie System colors were a “shot in the arm” for the folks who worked for the Chessie System. It was described as a “brighter, more modern look,” a look that would reflect the Chessie System’s bright future. In the next post we will look at the “happy railroad occasion,” the huge celebration around the unveiling of the Chessie System’s new colors and see the outpouring of support and celebration of the coming of the Chessie System. “Sleep like a kitten” now meant the shipper does not have to spend the night worrying about the shipment on the Chessie System.

References

Dixon, Thomas W. Jr. 1994. Chessie the Railroad Kitten. TLC Publishing. Lynchburg, VA

Ludington Daily News. 1973. C&O Receives Corp. Parent. June 26.

Ludington Daily News. 1972. C&O-B&O? Not Anymore. Now it’s ‘Chessie System.’ September 1.

Markowitz, Jack. 1973. C&O-B&O: Unified Plan Works. Pittsburgh Post Gazette. Jan, 19.

Toledo Blade. 1972. Chessie now on Big Borad. Holding Company Gets Certificate. Toledo Blade. June 18, 1973

Toothman, Fred Rees. 1993. Working for the Chessie System. Olde King Coal’s Prime Carrier. Vandalia Book Company.

Turner, Charles W., Thomas W. Dixon and Eugene L. Huddleston. 1986. Chessie’s Road. 2nd addition. Chesapeake and Ohio Historical Society: Alderson, WV.

Watkins, Hays T. 2001. Just Call Me Hays. Recollections, Reactions and Reflections on 42 Years of Railroading.