Working for a Different Johnson

Two years ago, Alan S. Boyd refused an offer to head the Association of American Railroads and accepted in stead Lyndon Johnson's appointment as the first U.S. Secretary of Transportation. Last week Boyd joined the rail roads after all -- under a different Johnson. He took the post of president of the Illinois Central Railroad, succeeding William B. Johnson, 50, who will be come chairman while remaining chief executive. "W.B.J.," as he is known around the railroad's Chicago headquarters, will also continue to head the parent Illinois Central Industries. It is a holding company that owns more than $200 million worth of real estate and air rights in Chicago alone, and has lately acquired some manufacturing companies. Boyd will handle day-to-day railroad operations, so Johnson can pursue further diversification.

Talent for Innovation. Boyd and John son are lawyers and longtime friends with a talent for innovation. Johnson came to the Illinois Central in early 1966 after rejuvenating the moribund Railway Express. He increased profits by 41% to $22 million in 1967; profits were still higher last year. Johnson raised the investment in new cars and track and computerized the line's traffic-information operation. At the railroad's Chicago commuter stations, he installed turnstiles that open automatically when a passenger inserts a magnetically coded ticket in a slot. Through a merger now awaiting approval by the Interstate Commerce Commission, Johnson hopes to link his railroad--which covers 6,714 miles in 14 states, from the Great Lakes to the Gulf of Mexico--with the 2,734-mile Gulf, Mobile & Ohio, whose tracks often parallel the Illinois Central's.

As the hiring of Boyd suggests, Johnson has not hesitated to depart from the railroad's tradition of promoting from within. Boyd, the former chairman of the Civil Aeronautics Board, was an able and dedicated administrator of the $6 billion-a-year Transportation Department. But he was not too adept in dealing with Congress, and that stymied his efforts to bring the Maritime Administration under the department's jurisdiction and to relieve overburdened airports. In Boyd, the Illinois Central may also be getting some trouble; conflict-of-interest questions have been raised about the Department of Transportation's grant of $25.2 million to improve commuter services on the Illinois Central. The grant was made in December while Boyd was under consideration as the railroad's president. Boyd disassociated himself from the grant, but Secretary of Transportation John A. Volpe has promised to investigate.

The experience of regulating a major segment of U.S. industry has taught Boyd an important lesson. He says: "We have put artificial restraints on various parts of the economy, which do not allow them to operate efficiently." He cites the railroads: they have been "hamstrung" by Washington and should be given greater freedom to raise rates.

This file is automatically generated by a robot program, so reader's discretion is required.