The story
Origins
Electric streetcars first appeared in Los Angeles in 1887. In 1895 the Pasadena & Pacific Railway was created from a merger of the Pasadena and Los Angeles Railway and the Los Angeles Pacific Railway (to Santa Monica). The Pasadena & Pacific Railway boosted Southern California tourism, living up to its motto "from the mountains to the sea."
The Pacific Electric Railway was created in 1901 by railroad executive Henry E. Huntington and banker Isaias W. Hellman. As a Vice President of the Southern Pacific Railroad (SP), operated by his uncle Collis Potter Huntington, Henry E. Huntington had a background in electric streetcar lines in San Francisco, where he oversaw SP's effort to consolidate many smaller street railroads into one organized network. Hellman, the President of the Nevada Bank, San Francisco's largest, became one of the largest bond holders for these lines and he and the younger Huntington developed a close business relationship. The success of their San Francisco trolley adventure and Hellman's experience in financing some early Los Angeles trolley lines led them to invest in the purchase of some existing downtown Los Angeles lines which they began to standardize and organize into one network called the Los Angeles Railway. When his uncle Collis died, Henry lost a boardroom battle for control of the Southern Pacific to Union Pacific President E. H. Harriman. Huntington then decided to focus his energies on Southern California.
In May 1901, Hellman, who had been Southern California's leading banker for almost three decades, wrote Huntington that "the time is at hand when we should commence building suburban railroads out of the city." Hellman added that he had already tasked engineer Epes Randolph to survey and lay out the company's first line which would be to Long Beach. In that same year, Huntington and Hellman incorporated a new entity, the Pacific Electric Railway of California, formed to construct new electric rail lines to connect Los Angeles with surrounding cities. Hellman and his group of investors owned the controlling majority of stock (double that of Huntington's) and the newspapers of the time referred to it as the Huntington-Hellman syndicate. Using surrogates, the syndicate began purchasing property and rights-of-way. The company's first main project, the Long Beach Line, opened on July 4, 1902.
Huntington experienced periods of opposition from organized labor with the construction of the new railways. Tensions between union leaders and like-minded Los Angeles businessmen were high from the early 1900s up through the 1920s. Strikes and boycotts troubled the Pacific Electric throughout those years, simmering with the onset of World War I, reaching a height of violence in the Los Angeles streetcar strike of 1919.
Railroads were one part of the enterprise. Revenue from passenger traffic rarely generated a profit, unlike freight. The real money for the investors was in supplying electric power to new communities and in developing and selling real estate. To get the railways and electricity to their towns, local groups offered the Huntington interest opportunities in local land. Soon Huntington and his partners had significant holdings in the land companies developing Naples, Bay City (Seal Beach), Huntington Beach, Newport Beach and Redondo Beach.
Harriman, who controlled the powerful Southern Pacific Railroad, was concerned with the competition that these new electric lines gave his steam railroad traffic, and had been prodding Huntington for joint ownership of the lines but Huntington refused to negotiate. In early 1903, Harriman proposed a franchise plan with three-cent fare plan to the Los Angeles City Council, a plan which, if accepted, would have handicapped the other railways severely. Huntington countered with a ticket book which gave the rider 500 miles (800 km) of travel for $6.25, which undercut the Harriman strategy. The Council vetoed the franchise idea, unable to believe adequate service could be provided for such a low fare. Then, on April 14, 1903, Harriman bought Hook's Los Angeles Traction Company, which ran lines within the downtown area and, through its California Pacific subsidiary, was constructing a line from Los Angeles to San Pedro.
The final confrontation came over a bidding war for the 6th Street franchise, in which the franchise (thought to be worth maybe $10,000), finally went to the top bidder for $110,000, with Harriman the secret winner. In May 1903, Huntington made an overnight trip to San Francisco and worked out an arrangement with Harriman. The Pacific Electric would get the Los Angeles Traction Lines, SP's San Gabriel Valley Rapid Transit Railway line, the 6th Street franchise, and some downtown trackage. In return, Harriman got 40.3% of PE stock, an amount equal to Huntington's, with Hellman, Borel and De Guigne owning the remaining 20%. Huntington could expand the PE as he saw fit, but he was not to compete with existing SP lines. A byproduct of this sale was that Harriman sold the banking unit of his Wells Fargo Company to Hellman who merged it with his Nevada Bank operations and established the Pacific Coast's largest, most powerful bank.
Construction
On June 6, 1903, Huntington created the Los Angeles Inter-Urban Railway, capitalized at $10 million, with plans to extend lines to Santa Ana, Newport Beach, the San Fernando Valley, La Habra, Redlands and Riverside, with branches to Colton and San Bernardino. He simultaneously created the Los Angeles Land Company. Huntington owned almost all the stock in the companies, with token amounts allotted to company directors. Although the company allowed Huntington to proceed with construction plans unencumbered by outside interference, the poor state of the bond market meant that he had to turn to stockholders to finance expansion. In 1904 he acquired and finished the Los Angeles and Glendale Railway. In June, LAIU assumed control of the Riverside and Arlington Railway and the Santa Ana and Orange Motor Railway, and soon after, PE and LAIU finished their extension to Huntington Beach and began building a line to Covina.
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Huntington continued to expand and not declare profits. On December 7, 1904, the Hellman group sold the rest of their shares and bonds in PE and LAIU to Huntington and Harriman for $1.2 million. Huntington and Harriman were now equal partners in ownership of the Pacific Electric. The Hellman syndicate retained their 45% interest in the Los Angeles Railway, which they thought would eventually declare dividends.
By 1905, the Newport and Santa Ana lines were completed. In 1906, the Newport line was extended to Balboa, and in late 1906, lines to Sierra Madre and Oak Knoll in Pasadena were finished. The two firms controlled 449 miles (723 km) of track, with the Pacific Electric at 197 miles (317 km) and the LAIU, 252 miles (406 km). Huntington purchased the Los Angeles and Redondo Railway in July 1905, along with the Redondo Land Company, which owned 90% of the land in the beach community. This announcement precipitated a land boom in the area which resulted in a quick return of Huntington's entire investment in the area and in the railway.
On March 19, 1906, an agreement was reached to sell control of the Los Angeles Pacific Railroad lines, owned by Moses Sherman and Eli P. Clark, for a reported $6 million to Harriman; this turned over all the lines in downtown Los Angeles to Santa Monica and down the coast to Redondo Beach to the Southern Pacific. In January 1907, the Hellman syndicate, after seeing that Huntington ran the Los Angeles Railway similarly to PE, continually expanding and not declaring dividends, sold their 45% stake in the Los Angeles Railway to Harriman and the Southern Pacific.
The Covina line was completed in 1907, as well as a line from Monrovia to Glendora. The system reached La Habra in 1908. By 1910 PE operated nearly 900 miles (1,400 km) of track. Routes had been built into or passed through areas just beginning to grow.
1905 was the Pacific Electric's most profitable year, when the road made $90,711. Profits from the Huntington Land and Improvement Company made up for the poor earnings of the interurban system, with profits of $151,000 in 1905 rising to $402,000 in 1907. However, in 1909, earnings were only $75,000.
Huntington had begun long negotiations with Harriman about consolidating the Los Angeles electric railways beginning in 1907. There had always been a difference between the two men as to the purpose of the railway, with Huntington seeing the PE as a means to facilitate his real estate efforts, and Harriman seeing it as part of the Southern Pacific's overall transportation system in Southern California. Harriman left Huntington alone until 1910, when the former refused to allow the latter to run a line to San Diego that would have interfered with a competitive arrangement Harriman had worked out with the Santa Fe Railway.
In July 1908, Huntington leased all the lines of the Los Angeles Inter-Urban Railway to Harriman. In 1909 he sold the systems in Fresno and Santa Clara County to the Southern Pacific. Talks paused after the death of Harriman on September 9, 1909, but resumed in early 1910. On September 27, 1910, Huntington and Southern Pacific management came to a final agreement. In a complicated stock and bond transaction, Huntington conveyed his 50% of Pacific Electric to the Southern Pacific, while he acquired SP's 45% interest in the Los Angeles Railway. In addition, Huntington conveyed the Los Angeles and Redondo Railway to the Southern Pacific. Huntington retained control of the Los Angeles Railway, the narrow-gauge street car system known locally as the "Yellow Cars," until a controlling interest in this company was sold off by Huntington's estate in 1944.
The Great Merger and the "New" Pacific Electric
In what was called the "Great Merger" of September 1, 1911, the Southern Pacific created a new Pacific Electric Railway Company, with all electrical operations now under the Pacific Electric name. The constituent railroads were:
Original "old" PE owned by Huntington
Los Angeles Inter-Urban Railway
Los Angeles Pacific Railway
Los Angeles and Redondo Railway
San Bernardino Valley Traction Company
San Bernardino Interurban Railway
Redlands Central Railway Company
Riverside and Arlington Railway Company
Following these acquisitions, PE was the largest operator of interurban electric railway passenger service in the world, with 2,160 daily trains over 1,000 miles (1,600 km) of track. It operated to many destinations in Southern California, particularly to the south and east.
McGraw electric railway directories report Pacific Electric track mileage under that company name from 119 miles in 1902 to 561.87 miles in 1911, and from 1,059.48 miles in 1917 to 1,043 miles in 1926. The directory measure counts single track owned, including main track, second track and sidings, and is shown separately from contemporary reports of operated system mileage. In 1922, for example, the directory reports 1,035 miles while the Commercial and Financial Chronicle reports 1,092.221 operated single-track miles.
Reported Pacific Electric track mileage by source year. McGraw reports single track owned; the comparison observations report operated or system single-track mileage. Source years are not calendar-year-end dates, and the unlike definitions are not spliced into one line.
Reported single-track milesSource year020040060080010001200190019101920193019401950McGraw directory track (miles)Contemporary system track (miles)Pacific Electric Railway track mileage.mw-chart-b23624caa0c5c8bccc64763ccea1926196fddf8a631737d9f8ac23324e36219c4e67a8e61d404c2beb6a46360dd3169ac881c1391c6227060416607d9df49abb__zr1098572-cls-5622246:hover{pointer-events:none}.mw-chart-b23624caa0c5c8bccc64763ccea1926196fddf8a631737d9f8ac23324e36219c4e67a8e61d404c2beb6a46360dd3169ac881c1391c6227060416607d9df49abb__zr1098572-cls-5622247:hover{cursor:pointer;fill:rgba(0,0,0,1)}.mw-chart-b23624caa0c5c8bccc64763ccea1926196fddf8a631737d9f8ac23324e36219c4e67a8e61d404c2beb6a46360dd3169ac881c1391c6227060416607d9df49abb__zr1098572-cls-5622248:hover{cursor:pointer}.mw-chart-b23624caa0c5c8bccc64763ccea1926196fddf8a631737d9f8ac23324e36219c4e67a8e61d404c2beb6a46360dd3169ac881c1391c6227060416607d9df49abb__zr1098572-cls-5622249:hover{cursor:pointer;fill:rgba(82,130,235,1)}.mw-chart-b23624caa0c5c8bccc64763ccea1926196fddf8a631737d9f8ac23324e36219c4e67a8e61d404c2beb6a46360dd3169ac881c1391c6227060416607d9df49abb__zr1098572-cls-5622250:hover{cursor:pointer;fill:rgba(255,199,56,1)}.mw-chart-b23624caa0c5c8bccc64763ccea1926196fddf8a631737d9f8ac23324e36219c4e67a8e61d404c2beb6a46360dd3169ac881c1391c6227060416607d9df49abb__zr1098572-cls-5622251:hover{cursor:pointer;fill:rgba(0,0,0,0)}
The Southern Pacific now began to emphasize freight operations. From 1911, when revenue from freight was $519,226, freight revenue climbed to $1,203,956 in 1915, 13% of total revenue.
During the 1920s profits were good and the lines were extended to the Pasadena area, to the beaches at Santa Monica, Del Rey, Manhattan/Redondo/Hermosa Beach and Long Beach in Los Angeles County, and to Newport Beach and Huntington Beach in Orange County. Extra service beyond the normal schedules was provided on weekends, particularly in the late afternoon when passengers wanted to return simultaneously. Comedian Harold Lloyd highlighted the popularity and utility of the system in an extended sequence in his 1924 film Girl Shy, where, after finding one Red Car too crowded, he commandeered another and drove at high speed through the streets of Culver City and Los Angeles.
In response to a proposal to establish the first bus company in Los Angeles by William Gibbs McAdoo, Pacific Electric and the Los Angeles Railway proposed their own system, the Los Angeles Motor Bus Company. A public referendum chose the latter in May 1923. The first service began in August 1923, and by 1925 had 53 miles of bus routes, the second-most in the nation after Chicago.
PE operated frequent freight trains under electric power throughout its service area (as far as 65 miles [105 km]) to Redlands, including operating electrically powered Railway Post Office routes, one of the few U.S. interurbans to do so. This provided important revenue. The PE was responsible for an innovation in grade crossing safety: the automatic electromechanical grade crossing signal, nicknamed the wigwag. This device was quickly adopted by other railroads. A few wigwags continue in operation as of 2006.
During this period, the Los Angeles Railway provided local streetcar service in central Los Angeles and to nearby communities. These trolleys were known as the "Yellow Cars" and carried more passengers than the PE's "Red Cars" since they ran in the most densely populated portions of Los Angeles, including south to Hawthorne and along Pico Boulevard to near West Los Angeles to terminate at the huge Sears Roebuck store and distribution center (the L.A. Railway's most popular line, the "P" line). The Yellow Cars' unusual narrow-gauge PCC streetcars, by now painted MTA two-tone green, continued to operate until the end of rail service in 1963.
Large profits from land development were generated along the routes of the new lines. Huntington Beach was incorporated in 1909 and developed by the Huntington Beach Company, a real-estate development firm owned by Henry Huntington, which still owns both land in the city and most of the mineral rights.
There are other local streetcar suburbs. Angelino Heights was built around the Temple Street horsecar, which was later upgraded to electric streetcar as part of the Yellow Car system. Highland Park was developed along the Figueroa Street trolley lines and railroads linking downtown Los Angeles and Pasadena. Huntington owned nearly all the stock in the Pacific Electric Land Company. West Hollywood was established by Moses Sherman and his partners of the Los Angeles and Pacific Railway. Moses Sherman, Harry Chandler, Hobart Johnstone Whitley, and others bought the entire southern San Fernando Valley in 1910. The electric railway and a $500,000 boulevard called Sherman Way connected the three townsites they were selling. These included Van Nuys, Marion (now Reseda), and Owensmouth (now Canoga Park). Parts of Sherman Way are now called Chandler Boulevard and Van Nuys Boulevard.
The railway company "connected all the dots on the map and was a leading player itself in developing all the real estate that lay in between the dots".
Decline
Huntington's involvement with urban rail was intimately tied to his real estate development operations. Real estate development was so lucrative for Huntington and SP that they could use the Red Car as a loss leader. However, by 1920, when most of the company's holdings had been developed, their major income source began to deplete. Many rural passenger lines were unprofitable, with losses offset by revenue generated from passenger lines in populated corridors and from freight operations. The least-used Red Car lines were converted to cheaper bus routes as early as 1925. In 1936, Pacific Electric acquired the Motor Transit Company, which operated intercity bus service within Southern California.
In the pre-automobile era, electric interurban rail was the most economical way to connect outlying suburban and exurban parcels to central cities.
Although the railway owned extensive private roadbeds, usually between urban areas, much PE trackage in urban areas such as downtown Los Angeles west of the Los Angeles River was in streets shared with automobiles and trucks. Virtually all street crossings were at-grade, and increasing automobile traffic led to decreasing Red Car speeds on much of its trackage. At its nadir, the busy Santa Monica Boulevard line, which connected Los Angeles to Hollywood and on to Beverly Hills and Santa Monica, had an average speed of 13 miles per hour (21 km/h).
Traffic congestion was of such great concern by the late 1930s that the influential Automobile Club of Southern California engineered an elaborate plan to create an elevated freeway-type Motorway System, a key aspect of which was the dismantling of the streetcar lines, replacing them with buses that could run on both local streets and on the new express roads.
When the freeway system was planned in the 1930s the city planners planned to include interurban tracks in the center margin of each freeway but the plan was never implemented. There was one exception that was within the Hollywood Freeway through Cahuenga Pass. The San Fernando Valley line from Hollywood took to the center of the Freeway over the pass and exited at Lankershim Boulevard. When that service was terminated, the freeway was expanded onto the former PE roadbed.
The Whittier & Fullerton line was cut in 1938, Redondo Beach, Newport Beach, Sawtelle via San Vicente, and Riverside in 1940. When the San Bernardino Freeway opened in 1941 but was not yet connected to the Hollywood Freeway, while the "Four Way" overpass was being constructed, westbound car traffic from the SB freeway poured onto downtown streets near the present Union Station. PE's multiple car trains coming and going from Pasadena, Sierra Madre, and Monrovia/Glendora used those same streets the final few miles from private right-of-way to reach the 6th and Main PE terminal and were bogged down within this jammed traffic. Schedules could not be met, plus former patrons were now driving. The San Bernardino line, Pomona branch, Temple City branch via Alhambra's Main Street, San Bernardino's Mountain View local to 34th Street, Santa Monica Boulevard via Beverly Hills, and all remaining Pasadena local services were all cut in 1941. Permission was received in September 1942 to abandon the shuttle line to General Hospital which company officials said had been operating at a loss for several months.
From Wikipedia’s article on Pacific Electric, shared under CC BY-SA 4.0.4