Grand Trunk Railway

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The Grand Trunk Railway was a Canadian railway system based primarily in Ontario and Quebec, with 13,000 km of operations over much of Canada and 1900km in neighboring parts of the U.S. It was Canada's most important railway for many years, and in the 1860s competed with the Pennsylvania Railroad for the status of longest system in the world. It never made big profits, and indeed much of its business was connecting American cities via its lines in Ontario. It overexpanded by building a route to the Pacific and was nationalized by the federal government in 1919. It is now part of the Canadian National Railways.

Contents

History

Early growth was stimulated by the enormous growth of U.S. trade after 1854 caused by Canadian-American reciprocity, which meant free trade between Canada and the U.S.

Chartered in 1852, it quickly purchased five local railways to link Toronto with Sarnia on the west and Montreal on the east, and also acquired a 999-year lease on the Atlantic & St. Lawrence Railroad that provided access to the ice-free port at Portland, Maine. As these arrangements were being put together, the Grand Trunk published a prospectus in London. According to the prospectus, the amalgamated railway would be the most comprehensive system of railway in the world, comprising 1,112 miles from Portland to Lake Huron, and would be built to as high a standard as any in England.

Construction on the line between Montreal and Toronto started in 1853. In 1855 the section from Montreal to Brockville was complete. In 1856, the sections of the line from Brockville to Toronto and from Toronto to Stratford were complete. By 1859 the line had been extended to Sarnia.

London financiers funded its purchase or lease of 50 other railways, making it the world's longest road in 1869, when it provided some of the infrastructure for Canadian confederation. By the 1880s, it reached most major cities in Quebec, crossed into Maine to provide a links to the ice-free American port of Portland, and stretched into the fast-growing Detroit-Chicago corridor inside the U.S. Apart from a 5-day strike in 1876, it avoided the labour violence that characterized most railways in the late 19th century

It was a private company headquartered in England that received heavy Canadian government subsidies and was never profitable because of competition from shipping and American railways. (In 1880 40% of the Grand Trunk traffic was from one or another American city to and from Chicago, taking a shortcut across Ontario.) Inflated construction costs, overestimated revenues, and an inadequate initial capitalization threatened bankruptcy for the Grand Trunk. Sir Joseph Hickson was a key executive from 1874 to 1890 based in Montreal who kept it afloat financially and formed an alliance with the Conservative party. Carlos and Lewis, (1995) show it managed to survive because its British investors accurately assessed the corporation's value and prospects, which included the likelihood that the Canadian government would bail out the railway should it ever default on its bonds. The government had guaranteed a very large loan and had enacted legislation authorizing debt restructuring. Such arrangements allowed the company to float new bond issues to replace existing debt and to issue securities in lieu of interest.

system map 1891

American executive Charles Melville Hays (1856–1912) joined the Grand Trunk in 1895 as general manager (and in 1909, president, based in Montreal). Hays was the architect of the great expansion during a colorful and free-spending era. He upgraded the tracks, bridges, shops and rolling stock, but was best known for building huge grain elevators and elaborate tourist hotels such as the Chateau Laurier in Ottawa. Hays blundered in 1903 by building a subsidiary the Grand Trunk Pacific Railway Company some 4800 km long; it reached Prince Rupert in northern British Columbia in 1914. The government built and the Grand Trunk operated the National Transcontinental to link the main Grand Trunk with its Pacific subsidiary. The very expensive subsidiary was far north of major population centers and had too little traffic. Nearing bankruptcy in 1919, the entire system was nationalized, In 1923 the government merged the Grand Trunk, the Grand Trunk Pacific, the Canadian Northern and the National Transcontinental lines into the new Canadian National Railways.

The Grand Trunk name survived on Grand Trunk's former United States lines; in 1928, Canadian National Railways consolidated its lines in Michigan, Indiana and Illinois into the Grand Trunk Western Railroad, a separate company owned by the CNR. The Portland line also kept the Grand Trunk name until acquired by a shortline operator in 1989.

See also

External links

references

Bibliography

  • Baskerville, Peter. "Hickson, Sir Joseph," Dictionary of Canadian Biography Online
  • Baskerville, Peter. "Americans in Britain’s backyard: the railway era in Upper Canada, 1850–1880," Business History Review 55 (1981): 314–36
  • Carlos, Ann M. and Lewis, Frank D. "The Creative Financing of an Unprofitable Enterprise: the Grand Trunk Railway of Canada, 1853-1881." Explorations in Economic History 1995 32(3): 273-301. Issn: 0014-4983
  • Currie, A. W. The Grand Trunk Railway of Canada. University of Toronto Press, 1957. 556 pp, the standard history
  • Hofsommer, Don L. Grand Trunk Corporation: Canadian National Railways in the United States, 1971-1992. 1995. 227 pp.
  • Leonard, Frank. A Thousand Blunders: The Grand Trunk Pacific Railway and Northern British Columbia (1996) 344 pages online edition
  • Regehr, Theodore D. "Hays, Charles M." Dictionary of Canadian Biography Online

Primary sources

  • Canada. Legislature. Legislative Assembly. Special Committee on the Condition, Management and Prospects of the Grand Trunk. Report 1857, 263 pages online
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