Business: Comeback for Railroads

The nation’s railroads, many of which have been chugging along unspectacularly, have finally begun to pick up steam from the economic boom. The two biggest U.S. roads, the Pennsylvania and the New York Central, last week reported climbing profits. The Pennsy’s $4,512,912 profit for May (34¢ a share) set a 2½-year record, changed the big road’s $2,264,466 deficit at the beginning of the month into a solid profit for the year’s first five months. For the third month in a row, the Central’s earnings were up, reached $3,346,217, or 52¢ a share, giving the Central a $6,500,000 profit for the first five months.

Operating in the black for the first month this year, the Lehigh Valley Railroad chalked up profits of $87,121 in May v. last May’s loss of $284.321. The Norfolk & Western Railway raised its income in the first five months to $19 million with a $4,500,000 profit in May. One exception: the New Haven Railroad (TIME, June 22), which fell deeper into the red in May with a $517,039 loss, its fifth consecutive monthly loss and $150,000 greater than its loss in recession May 1958. To give the railroads hope for even better earnings, revenue freight car-loadings reached their highest level in 20 months, topped the 1958 period by 15.2%, with 723,738 cars loaded in the latest week.

Many another industry was racing the railroads alongside the tracks.

¶ Car production for the week was scheduled at 130,621 cars, or 43% ahead of last year. Ford Economist George P. Hitchings revised his earlier prediction of a 6,000,000-car sales year, said the industry should easily do 3% or 4% better than that.

¶ Construction-contract awards for dwellings, warehouses and office buildings rose 4% in May over last year to reach $3.5 billion; housing awards alone climbed 25%. Total construction gain for the first five months: 17% over last year.