service is a moot question. We would like to think they could. There was a period about 5 years ago when the various builders built some Talgo-type trains; you remember, those low four-wheel cars. They were not successful as far as getting people back on the rails. I wish I could give a better answer. I think that certain runs are going to be profitable and I think that certain trains can be made profitable. Whether the railroads are going to get the ordinary intercity business back with equipment, I could not say. I do know there are certain cities that are quite concerned about the loss of rail service. One I know is Indianapolis. They have no rail service between Indianapolis and Chicago, about 250 miles. The Indianapolis people are quite concerned about this and would like to get the rail service back, but I think the railroads feel that they will be pulling empty cars again. Mr. KORNEGAY. I can understand that, but I also understand that there is a feeling on the part of the general public that in so many instances in certain sections of the country the railroads are not interested in transporting people. It would appear their primary interest is in transporting goods rather than people, and for that reason the people are not getting the type of service from the railroads that they got at one time or that they can now get on other modes of transportation. That was my reason for bringing the point up with you. Mr. SCALLAN. Yes, sir.

Mr. KORNEGAY. And certainly it is my hope that the railroads would as individual concerns, or collectively through organizations such as the one that you are representing today, attempt to render a better service to the public because to my way of thinking they are a vital segment of our national transportation system. We ought not to stand by and watch them just go away.

way.

Mr. SCALLAN. I am sure that, as a supply industry, we feel the same Our passenger car plant represents maybe a $5 million investment on the part of our company and we have kept it going, but building very few cars. We hope much the way you do, that there is going to be a resurgence of passenger car building. It is coming through the commuter and the rapid transit fields now, and I believe it is going to come with intercity equipment.

Mr. KORNEGAY. There has been some talk about the increase of power of the locomotives and also there has been an increase in the size of boxcars. Is that not true?

Mr. SCALLAN. Yes, sir.

Mr. KORNEGAY. As well as innovation of new types of cars, boxcars and tank cars, that have increased volume?

Mr. SCALLAN. That is right. A boxcar from the outside looks like a boxcar always did, but actually it is a very elaborate, complicated, and expensive piece of equipment now. As to most of the boxcars that are being built, they are moving away from the 50-ton type, and that has happened within a year. Now there are 70-ton and 90-ton cars. They have cushioning built in them. For instance, they are getting 90 tons of newsprint in the new cars, so the capacity is higher. The cars are getting longer. Most cars were 40-foot cars 2 or 3 years ago. They went up to 50 feet and many now are 60 feet. Some of the new cars are three tier affairs. The hopper cars are 100-ton cars. There are devices that unload automatically. There are a great many innovations now taking place, so that freight cars are becoming quite

expensive and quite an elaborate piece of material-handling equip

ment.

The railroads are doing a great deal to make it easy for their shippers. They now have a wide-door boxcar with 50 feet of door that goes up like a garage door into the roof so that the lumber shipper or any other shipper, can move right into the car. Then it is cushioned, which eliminates most of the bracing in the car. We took a quick poll last week as to the amount of money being spent by our member companies on research and development work, and 33 companies replied that they have spent $23 million in the last 6 years.

Mr. KORNEGAY. In research?

Mr. SCALLAN. In research, and they are spending at the rate of $5 million a year. I think it is safe to say that our members are spending at least $10 million a year in direct research for the railroads.

Mr. KORNEGAY. Do you have this figure? How many new miles of railroad track were laid during that 4-year period, 1958 to 1961 that you are talking about?

Mr. SCALLAN. I am sorry, I have not, but I will be very glad to get it for you.

Mr. KORNEGAY. And also I would like to know, sir, if you have it available, the number of miles of track that were relaid. By that I mean straightened out or where improvement was made along the line.

Mr. SCALLAN. Yes, sir.

(The following material was subsequently furnished for the record :)

New tracks laid-Railroads of class I in the United States, 1951-60

New rail and ties laid-Railroads of class I in the United States, 1951-61

Mr. GLENN. Mr. Scallan, does your company make trolley cars and subway cars, and if so, what is happening to the market in those two items?

Mr. SCALLAN. By trolley, do you mean the rapid transit-type of car?

Mr. GLENN. Yes.

Mr. SCALLAN. Yes, sir, we do. In the last year, there has been a tremendous revival in the cities where, not being able to move the people in and out by automobiles and the highways, they are going to the rapid transit type of transportation. The three companies I named before are very active in that and are bringing out new designs. We are right now building cars for Boston; rapid transit cars for the city of Boston, which are new and modern. The St. Louis Car Division of General Steel Industries is building subway cars for New York City. The Budd Co. is building some cars for Philadelphia and other places.

Apparently there is going to be quite a bit of that kind of work. We are very active, as all the other companies are, in developing new designs and bringing out new things that will be more comfortable and convenient for the passenger.

Mr. GLENN. This is in furtherance of the mass transportation problems which face most of our large cities?

Mr. SCALLAN. That is right. We have just completed 53 cars financed by the Port of New York Authority for New York Central operation. We are going to build 30 now for the Long Island along

the same line. As I say, the other companies are doing the same thing, and there are many improvements in the electric propulsion and the braking, and the new metals, a lot of new alloys, new alloy steels and aluminum. There are quite a few new, improved devices which you will find in these new rapid transit cars.

Mr. GLENN. Thank you very much.

That is all, Mr. Chairman.

The CHAIRMAN. Mr. Keith?

Mr. KEITH. Thank you, Mr. Chairman. I have received some mail recently from some constituents who have recently returned from Europe. They speak very favorably of the improvements there in commuter transportation and contrast them, rather unfavorably, with those we find in Boston and New York. Is there any significant development in Europe in this area that we can learn from?

Mr. SCALLAN. We have our engineers going to Europe periodically to find out. They have some new things, particularly in the trucks and the riding, but I am sure that anything worthwhile we will have here in these new cars. We are very close to that, as are all the other companies involved in it.

In Boston we hope that they will feel differently next year when they have these new cars.

Mr. KEITH. When are the new cars due in Boston?

Mr. SCALLAN. Toward the end of this year.

Mr. KEITH. And how many of them are there?

Mr. SCALLAN. There are 92. There are 46 two-unit cars, 92 cars altogether. Whether they call them units or cars, there are 92. Mr. KEITH. Thank you, Mr. Chairman.

The CHAIRMAN. Mr. Curtin?

Mr. CURTIN. Thank you, Mr. Chairman.

Mr. Scallan, you speak of the modernization and improvement of freight cars, but when are you going to start modernizing and improving the ordinary coaches and pullman passenger cars?

Mr. SCALLAN. As I say, there really just has not been a demand for that kind of car in the last 10 years. I do not believe there has been a sleeping car built in 5 years. There is just absolutely no demand for such equipment from the railroads.

Mr. CURTIN. On the trips between here and Trenton, N.J., which is just across the Delaware River from my home, I generally am a coach rider and very infrequently a pullman rider, but on the few occasions when I have been in one of those pullman parlor cars I find the chairs are extremely uncomfortable, those barrel-type chairs that do not even recline. They have been in style the last 30 years, it seems to me, and there have been no changes.

Mr. SCALLAN. In the commuter service, for instance in Chicago, we have the North Western on the north side. Their cars are air conditioned. They are very well lighted and they are all new, 200 of them all brand new. They have a very satisfied group of commuters. If you are talking of that type of passenger transportation, there is a lot of improvement already.

Mr. CURTIN. What depreciation rate do the railroads use on those cars?

Mr. SCALLAN. Previously they were using, I think, 30 years and now they can use 14 or 15 years if they want to.

Mr. CURTIN. Most of them have been completely depreciated by this

time I presume.

Mr. SCALLAN. Yes, sir.

Mr. CURTIN. And the same way with the coaches for the ordinary passenger traffic. I ride in those most of the time and a great majority of these coaches are mighty old and uncomfortable. Are there any plans in that field?

Mr. SCALLAN. If you are talking about intercity

Mr. CURTIN. Yes, I am.

Mr. SCALLAN. Again, there, the railroads have been using the cars. they have, and they have a great many fairly new cars. The railroads bought many passenger cars in 1947, 1948, and the period from 1946 to 1953, then their passenger travel fell off so they were left with some very fine passenger cars. They have tended not to replace these or to put any new ones in service. As the supply industry, we would like to see a resurgence of the passenger business.

Mr. KEITH. Will the gentleman yield?

Mr. CURTIN. Yes.

Mr. KEITH. Has there been any noticeable change or improvement in orders as a result of the new regulations pertaining to depreciation that the administration has recommended?

Mr. SCALLAN. There has not been as yet because I do not think there has been time. However, we fully expect that there will be.

Mr. CURTIN. That is all, Mr. Chairman.

Thank you.

The CHAIRMAN. Mr. Sibal?

Mr. SIBAL. Thank you, Mr. Chairman.

Mr. Scallan, does your industry have a large research and development program?

Mr. SCALLAN. Among its membership, yes, sir, we have. We have made a sampling of this within the last week. We found that 33 of our 118 members who replied to our questionnaire spent $23 million in the last 6 years for research, and are now spending at the rate of about $5 million annually. Using that 33-company sample, I would say that we are spending at least $10 million directly on research for the railroads. That would not include metal research by the steel companies or aluminum research by the aluminum companies, but this is money being spent for direct betterment of railroad equipment, track machines, signals, and various other things; for instance, the pushbutton type of sorting yards and the electronics. So to answer your question directly, our individual members are carrying on what is a surprising amount, I think, of research.

Mr. SIBAL. Is this essentially aimed at the freight aspect of railroading?

Mr. SCALLAN. Not entirely. Quite a bit of it now is being aimed at the passenger, but more at the commuter rapid transit type of passenger.

Mr. SIBAL. IS work being done on such ideas as the monorail and stich as that?

Mr. SCALLAN. Yes. Among the electrical companies are new propulsion motors; the brake companies have better, lighter brakes, and all of that, yes.