The Northerns

The Interstate Commerce Commission last week agreed to a railroad merger that will have everything going for it except euphony. The commission, reversing its own antimerger order of 20 months ago, approved the creation of the Great Northern Pacific & Burlington Lines, Inc. The new road fuses the present Great Northern, the Northern Pacific and the Chicago, Burlington & Quincy along with smaller subsidiaries, including the Spokane, Portland & Seattle Railway and the Pacific Coast Railroad. With 24,600 miles of track stretching across more than a quarter of the nation, the G.N.P. & B. will be the U.S.'s longest railroad. Consolidated revenues of $850 million a year will rank it right behind the Pennsylvania and the Southern Pacific. With annual savings from combined operation as high as $41.7 million, the new giant should emerge as one of the most profitable railroads in the country.

Size and efficiency indeed were two elements that frightened the ICC when it first considered and turned down by a 6-to-5 vote a merger of lines that railroad men refer to as "The Northerns." The Government feared that the G.N.P. & B. would hurt competitors, notably the Milwaukee Road and the Chicago & North Western. Those two roads, which are also intent on merging, withdrew their opposition to the G.N.P. & B. after the Milwaukee was allowed access to such cities as Billings, Mont., and Portland, Ore. and to Canadian points that had all previously been terminals only of The Northerns. Railroad unions withdrew their opposition after the lines pledged to work off an excess of 4,511 employees by attrition. One complainant left, however, is the Denver & Rio Grande Railroad, which may yet appeal the ICC decision to federal courts.

Depending on the outcome of any legal action, the new railroad is prepared to begin merged operations almost immediately. The first and biggest step will be to inaugurate straight-through freight service from Chicago to the West Coast, with savings in time and money for both the railroad and its shippers. After that will come capital outlays for an electronic freight yard in Minneapolis and expanded freight facilities in Spokane and Seattle. As projected, the management lineup--which could stand some streamlining--would have Great Northern President John M. Budd as chairman and chief executive of the new company, Burlington President William J. Quinn as vice chairman, and Northern Pacific President Louis W. Menk as president.

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