Napa Valley Wine Train

The Napa Valley Wine Train is one of America’s premier excursion trains, running from Napa, through the Napa Valley, into Saint Helena, at the north end of the Valley. The train runs through spectacular vineyards, with views of the rugged peaks of the Vaca and Mayacama ranges. Along the way, you are treated with world class food and wine, and an experience that is not often rivaled.

The track used for the Wine Train is part of the original Napa Valley Railroad, founded by Samuel Brannan in 1864. Originally, this line was used to bring tourists from Vallejo, California (which connected via ferry to the San Francisco Bay Area ferry boat service) to the resort town of Calistoga, 42 miles to the north. This iteration did not last long, and the California Pacific Railroad Extension Company purchased the railroad at a foreclosure sale in 1869. The railroad was renamed the California Pacific Railroad, and it was then leased to Southern Pacific in 1885. SP then connected it to their main line in Suisun, California, and Southern Pacific later acquired the California Pacific Railroad in 1898.

Under SP control, the line was electrified and renamed San Francisco, Napa and Calistoga Railway in 1905 and carried passengers until 1929. Once passenger service stopped, SP used the line as a freight branch line until 1987 when SP petitioned for abandonment.

In 1987, the Napa Valley Railroad Operating Company was formed by local entrepreneurs, headed by Vincent DeDomenico. Shortly after forming, the NVRR acquired the right of way of the line from SP, leading to the line in use today, from downtown Napa to Saint Helena.

The Napa Valley Wine Train began operation in 1989, and has carried more than 2 million passengers through the valley. This train has a capacity of 370 passengers, and often makes two runs per day. NVRR currently runs 9 passenger cars in its consist, including lounge, observation, and several dining cars. In 1997, the NVRR acquired a super dome car, which was originally run by the Chicago, Milwaukee, Saint Paul and Pacific Railroad, and had logged over 1 million miles. In 2013, they added a modified boxcar containing a 450 KW generator in order to maintain constant power to the train during the time that the locomotives are switched for the return trip from Saint Helena. These cars are normally pulled by two FPA-4 locomotives first owned by Canadian National Railway. These engines were modified to run on compressed natural gas.

In September 2015, the DeDomenico family announced that they had sold the railrod to Seattle based Noble House Hotels & Resorts, Ltd. and Brooks Street, a California real estate development company.

The most recent addition to the service through the valley came in May 2016, when it was announced that passengers can choose to be dropped off at four wineries along the route, Robert Mondavi, Charles Krug, Merryvale, and V. Sattui. To accommodate this new service, two passenger cars will be added to the fleet.


Amtrak – The Beginning

After America spread west in the mid to late 1800s to the 1920s, nearly all long distance travel in the United States was done by rail. By 1929, there were nearly 65,000 railroad passenger cars in operation on over 250,000 miles of track. At this time, all passenger service was on private railroads.

As the popularity of the automobile increased through the 1930s and 1940s, passenger service diminished dramatically. With the construction of the National Highway System, service continued to fall as passengers more frequently traveled by car, bus, or airplane, all of which were heavily subsidized by the United States government leading to lower travel fairs.

The railroads realized that they could not compete with the automobile for cheap, convenient, and easy travel, so they went with luxury. In the 1930s, huge streamliners gained the public’s attention and admiration as the Pioneer Zephyr and Flying Yankee travelled the rails. Even with these amazing locomotives and continued improvement in passenger comfort, rail traffic continued to decline.

The rail industry saw a huge increase in passenger traffic during World War II. Due to troop movements and restrictions on automobile fuel, passenger service soared sixfold during the War. With all this new traffic, the railroads were able to upgrade their overworked and neglected fleets with fast and luxurious streamliners including the Super Chief and California Zephyr.

This resurgence was short-lived however. By 1946, there were 45% fewer passenger trains than in 1929. As passenger service declined, so did the profits. Nearly all passenger trains were operating on a loss, and by the mid 1950s, railroads claimed aggregate annual losses of more than $700 million on passenger service. At this time, the only thing keeping many of these passenger trains economically viable was the US Mail contract. This lasted until 1966, when the US Postal Service switched to trucks and airplanes. This proved to be the death bell of private passenger service in the United States.

Many railroads were requesting to terminate passenger service in the late 1960s. This was followed by several huge bankruptcies. The Pullman Company became insolvent in 1969, and the Penn Central followed in 1970.

In 1970, Congress passed the Rail Passenger Service Act. In this bill, the National Association of Railroad Passengers sought government funding to assure the continuation of passenger trains. This led to the formation of the National Railroad Passenger Corporation (NRPC), a hybrid public-private entity that would receive taxpayer funding and assume the operation of intercity passenger service. NRPC was originally known as Railpax, but shortly before starting operations, the name was changed to Amtrak.

According to the Rail Passenger Service Act, there were several key provisions that led to Amtrak taking on nearly all passenger service in the United States.

  • Any railroad operating intercity passenger service could contract with the NRPC, thereby joining the national system.
  • Participating railroads bought into the NRPC using a formula based on their recent intercity passenger losses. The purchase price could be satisfied either with cash or rolling stock.
  • Any participating railroad was freed of the obligation to operate intercity passenger service after May 1, 1971, except for those services chosen by the Department of Transportation as part of a basic system of service and paid for by NRPC using federal funds.
  • Railroads that chose not to join the NRPC system were required to continue operating their existing passenger service until 1975 and thenceforth had to pursue the customary ICC approval process for any discontinuance or alteration to the service.

Of the 26 railroads still offering intercity passenger service in 1970, only six declined to join Amtrak.



The St. Louis-San Francisco Railway (Frisco) was incorporated in Missouri on September 7, 1876 from the Missouri Division and Central Division of the Atlantic and Pacific Railroad. This was one of only two railroads authorized to build across Native territory, the other being the Missouri-Kansas-Texas. With little competition in the area, the Frisco was able to quickly stretch out along Missouri, Oklahoma, Arkansas, and Kansas by the end of the 19th century. During this time the Aitchison, Topeka and Santa Fe Railroad (ATSF) took over the parent railroad, the Atlantic and Pacific, in order to gain track rights across the Mojave Desert into California. The ATSF control only lasted a short time, but they maintained control of the Western routes after separating, leaving the Frisco to the Great Plains. Thus the Saint Louis-San Francisco never reached west of Texas, over 1000 miles from the original destination of San Francisco.

After the ATSF spun off the Frisco, then known as the St. Louis & San Francisco Railroad, the Frisco became focused on serving the Midwest. The Frisco struggled during the early 1900s and fell into receivership in 1913, reemerging as the St. Louis-San Francisco Railway. For the next thirty years, the Frisco did well at maintaining and upgrading its equipment and lines. The railroad again fell into bankruptcy during the Great Depression. The Frisco reemerged from its final receivership in 1947, with well-maintained track and motive power. Due to the diligence on keeping its fleet and rails in good shape, the Frisco was ready for the future.

In the 1950s, the Frisco opened a high-tech hump yard in Memphis, where an inclined track and computer-controlled switches guide cars into their correct staging track, thus expediting freight service. Throughout the mid to late 20th century, the Frisco continued to prosper and innovate. They were among the first railroads to offer run-through service with other carriers, thereby pooling their motive power and hauling along previously inaccessible trackage. This expanded their territory, opening new markets to their services. They were also among the first major railroads to shed the money-losing passenger operations prior to Amtrak.

In the 1960s and 1970s, the Frisco boomed. During this time, industries were sprouting up in the South, and the Frisco had positioned themselves to profit from this explosive growth. As Frisco became more successful, major railroads began to discuss purchasing the Frisco and their profitable freight service in the South and Midwest. In 1980, Burlington Northern completed their purchase of the Frisco, expanding the BN presence into the South to take advantage of the new, highly lucrative chemical traffic. Much of the Frisco service still remains under BNSF, with the Frisco trackage still providing the main artery into the Gulf Coast and the Southeast.


Southern Pacific – Early Years

The Southern Pacific (SP) can trace its lineage back directly to the Central Pacific Railroad, one of the most important railroads of the 1800s, and one of the two directly involved with the first American transcontinental railroad (the other being Union Pacific).

The Central Pacific (CP) was the result of the vision of Sacramento merchants Leland Stanford, Collis P. Huntington, Charles Crocker, and Mark Hopkins, who became known as the “Big Four”. In 1857, a young civil engineer, T.D. Judah released his “Practical Plan for Building the Pacific Railroad.” The Big Four immediately became interested in the project, and even though none of the men had any construction or railroad experience, they marched forward. Against the advice of their friends and in the face of strong opposition and ridicule, they threw their entire resources and personal credit into the project.

Prior to gaining the interest of the Big Four, Judah had brought his plans to Congress on several occasions, made preliminary surveys over various routes through the Sierra, and had received support from small mountain towns along the proposed routes. However, he had failed to gain any traction with his plans until Stanford, Huntington, Crocker, and Hopkins believed in the plans enough to throw everything they had at achieving vision of the Pacific Railroad.

In 1861, Judah took four teams of engineers into the mountains. The reports that came from these engineers led to incorporation and organization of the Central Pacific. Stanford was president, Huntington was vice-president, Hopkins became treasurer, and Crocker became a director. On the back of this organization and the engineering surveys, Judah again went to Washington. This time he accomplished the passage of the Pacific Railroad bill, which extended federal funding to the project.

One major hurdle for federal funding arose, the railroad needed to lay the first forty miles of track before they saw any federal money. Even though the founders of the CP were wealthy, they could not come close to financing those forty miles. Though the four men were not able to woo investors with the potential of the investment, they did impress them with their high credit rating and reputations. The four associates personally guaranteed the interest on a limited number of Central Pacific bonds for ten years, and were able to raise enough money to begin.

The first rail was laid in Sacramento on October 26, 1863, the first locomotive, “Governor Stanford,” went into service on November 10, 1863, and the first 31 miles of railroad were in operation to Newcastle by June 10, 1864.

The remaining 9 miles needed to receive the federal funds proved more difficult. The money raised by Huntington had been exhausted. Work never came to a complete stop, but there were days when there was not one cent in the company’s treasury. They then turned to the public for support. Aid became available in 1865, and the forty mile mark was passed later that year. Federal funding meant that serious construction could begin.

Construction over the Sierras was treacherous and slow. Due to the shortage of funds, there was no construction during the mild winter of 1864-1865, and by the fall of 1865 winter had returned in full to the Sierras. Heavy snows fell on the mountains through the winter of 1865 to 1867, but the team made progress. The first locomotive crossed the California-Nevada border on December 13, 1867. By the end of that year, there remained only a seven-mile gap at the Sierra Summit, 7,017 above sea level.

Due to the heavy snowfall, it was very difficult to keep the railroad free from snow. The builders became convinced that this problem must be solved before the railroad could be successful through the region, so it was decided that snowsheds would be built over the tracks. The first experimental sheds were built in 1867. These sheds were a success, and it allowed construction to speed along. Forty miles of sheds were eventually erected in the high Sierras.

With the help of the snowsheds, the CP was able to lay down more than a mile of track a day through the mountains. The tough work in solid rock above Donner Lake was completed in the spring of 1868, and at last, the Sierra had been defeated. On June 19 of that year, the line was opened from Sacramento to Reno, Nevada.

Once the Sierras were dealt with, track laying went into high gear, peaking with ten miles and 56 feet laid on April 28, 1869. They were just a few miles from Promontory.

On May 10, 1869, the Golden Spike was laid. Telegraph lines at Promontory were connected to a specially prepared hammer and spike so that the whole world could hear Leland Stanford hammer in that last spike at 12:45 pm, Promontory time.

Two days after this momentous occasion, transcontinental passenger service was inaugurated. The first daily passenger train between Sacramento and Omaha was known as the “Atlantic Express” eastbound and the “Pacific Express” westbound. Passengers completed the 3,167 mile Sacramento to New York trip in seven days flat.

The CP kept expanding, acquiring several smaller railroads in Central California into the CP, and finally gained access to the San Francisco Bay area through these acquisitions. One of these companies was the small Southern Pacific Railroad based out of San Francisco. During restructuring done in the 1870s and 1880s, the Central Pacific became the Southern Pacific.

Now a footnote in history, the Southern Pacific was founded in San Francisco in 1865 by a group of businessmen led by Timothy Phelps with the aim of building a rail connection between San Francisco and San Diego. With the entire might of the Central Pacific, this vision was met, and more. With the CP, the Southern Pacific extended through Oregon, much of California, and the Southwest.The_Great_Pleasure_Route_of_the_Pacific_Coast_Southern_Pacific_Railroad_1885.jpg

Denver & Rio Grande

The Denver & Rio Grande Railway (D&RG) was incorporated on October 27, 1870 by General William Jackson Palmer and a board of four directors. The D&RG was to run on 3 foot rail from Denver to El Paso, an estimated 875 miles south, then south to El Paso, westward along the Arkansas River, and continue south the the San Luis Valley of Colorado toward Rio Grande. The first rails were laid out of Denver on July 28, 1871, and reached Colorado Springs by October 21. The 3 foot narrow gauge was chosen due to construction costs being less than the standard rail. The narrow gauge had the hidden benefit that it turned out to be advantageous in the mountain terrain of Colorado and the Rockies.

As the D&RG railroad was feverishly laying track, so was the Aitchison, Topeka and Santa Fe Railway (ATSF). The two railroads fought over the same terrain, provoking the 1877 to 1880 war over right of way. Both railroads hired gunslingers and brought politicians, while the courts intervened to bring settlement to the disagreements. The two railroads continued to fight over land through the mountains through the 1880s.

By 1880, D&RG founder William Bell had begun to organize railway construction in Utah, which became the Denver & Rio Grande Western Railway in mid-1881. The “Western” (D&RGW) was to work eastward from Provo, Utah to an eventual link with the D&RG in Colorado. This happened near Green River, Utah on March 30, 1883, and by May of that year, the D&RG formally leased its Utah subsidiary as previously planned.

The rapid expansion and continual fighting with the ATSF caused financial hardship on the D&RG. The railroad went into receivership in July 1884, with foreclosure and sale of the Denver & Rio Grande Railway following shortly. The new Denver & Rio Grande Railroad took formal control of property and holdings on July 14, 1886.

The D&RG continued expanding through the late 1800s. The railroad built west from Pueblo, reaching Cañon City in 1874. They built through the Royal Gorge, reaching Salida on May 20, 1880, and was pushed to Leadville later that same year. From Salida, they pushed west over the Continental Divide at the 10,845 foot Marshall Pass and reached Gunnison on August 6, 1881. They continued building west, completing the narrow gauge transcontinental link with the Rio Grande Western Railway in March 1883, thus completing the link from Denver to Salt Lake City.

At the same time, they pushed south towards Santa Fe, New Mexico. They pushed west from Waldenburg, Colorado over La Veta Pass by 1887. They reached Alamosa by 1878, and they pushed south towards Antonito. From there, they headed over the Cumbers Pass, along the Colorado-New Mexico border, reaching Durango, Colorado in August 1881 and continuing north to the rich mining areas around Silverton in July 1882. Parts of this line survive today, including parts of the standard gauge line operated by the San Luis and Rio Grande Railroad, and the narrow gauge Durango-Silverton, both of which are run as tourist lines.

The original Denver & Rio Grande Western Railway built a narrow gauge line from Ogden, Utah via Soldier Summit to Grand Junction, Colorado. The railroad became the Rio Grande Western Railway in 1889 as part of a finance plan to upgrade the line from narrow gauge to standard gauge, and built several branch lines in Utah to reach lucrative coal fields. In 1901, the Denver & Rio Grande merged with the Rio grande Western, consolidating in 1908. The railroad was weakend by speculators, who had used the Rio Grande’s equity to finance the Western Pacific Railroad construction. The United States Railroad Administration (USRA) took over the D&RG during World War I, and in 1918, the D&RG fell into receivership after the bankruptcy of Western Pacific. The Denver & Rio Grande Western Railroad (DRGW) was incorporated in 1920, and formally emerged as the new re-organization of the Denver & Rio Grande Railroad on July 31, 1921.

The DRGW continued acquisitions and building new track through the early 1900s, and again slipped into bankruptcy in 1935. It emerged in 1947, merging with the Denver and Salt Lake Railroad. This gave them control of the Moffat Road through the Moffat Tunnel, giving Denver a transcontinental link to the west.

The DRGW now possessed a direct route from Denver to Salt Lake City, but UPs more northerly route was much faster and less mountainous. DRGW thus began its “fast freight” trains: short, frequent trains pulled by multiple diesel locomotives. The speed of the diesels and the fact that they could be linked for quicker routes quickly outdated the steam trains on DRGW track.

To combat the UPs fast passenger service, the DRGW formed the California Zephyr with the Chicago, Burlington and Quincy Railroad (CB&Q) and the Western Pacific (WP). CB&Q took the train from Chicago to Denver, DRGW from Denver to Salt Lake City, and the WP heading the Zephyr from Salt Lake City to Oakland, California. Because they could not compete with speed, the California Zephyr offered a more leisurely “rail cruise” with ample vistas of the Rockies. The California Zephyr turned a profit through the late 1950s, but by the mid-1960s, it was only profitable during late spring, summer and fall. Then in 1970, WP pulled out. DRGW still refused to join the Amtrak system, opening the Rio Grande Zephyr between Denver and Salt Lake City until 1983.

In 1988 the company that controlled the DRGW, Rio Grande Industries, purchased the Southern Pacific Railroad, rolling both railroads under the more famous SP name. Along with the SP name, the new railroad used SP philosophies and dropped the “fast freight” that had served the DRGW so well in the mountains. This was mainly due to continually rising coal costs, and by the early 1990s, the Rio Grande/Southern Pacific Railroad had become largely dependent on hauling coal in Colorado and Utah.

After the merger, Rio Grande kept their paint schemes and reporting marks, but some of the SP locomotives got the Rio Grande treatment. The “Bloody Nose” locomotives had the serif font on the sides of the locomotives replaced by Rio Grande’s “speed lettering”.

In 1996, the SP/DRGW was sold to Union Pacific. The last Rio Grande engine in service was retired in 2008, and the Rio Grande faded from existence. Then in 2006, UP unveiled UP 1989, an EMD SD70ACe painted in a stylized version of the DRGW color scheme. Several others have been painted in remembrance of the several railroads UP have acquired. Along with the Rio Grande, there were also Missouri Pacific, Missouri-Kansas-Texas, Chicago and North Western, Southern Pacific, and Western Pacific.

GATX Tank Train

Since the beginning of railroading in the United States, tank cars have been an essential part of the freight car fleet. From their primitive beginnings of barrels mounted to flatcars, tank cars have evolved into complex designs optimized for hauling a variety of liquids, from corn syrup to anhydrous ammonia.

While tank cars are prolific, most railroads do not own large fleets of these relatively specialized cars, preferring to make use of fleets managed by freight car companies, such as GATX. One of the larger equipment management companies, GATX can trace its history to the turn of the century, and is well-known for its large fleet of tank cars of varying designs, many of which were built in-house. One of the more distinctive designs to originate from GATX is the “TankTrain”, which made its debut in the 1970s. The TankTrain concept was a solution to the problem of long load/unload times for unit train shipments of particular commodities, such as crude oil. A typical unit train can take significant time to load or unload, with the need for workers to attach the necessary hoses and other fittings to each individual car, coupled with the necessary time to load or unload the commodity from each car.

The TankTrain was designed to significantly reduce this time. TankTrain cars are interconnected with a large-diameter, flexible hose between each car, which allows the commodity to be siphoned off at a single point at the end of a set of cars while being “pushed” at the opposite end with inert nitrogen gas. Using this method, TankTrain cars can be loaded or unloaded at a rate of approximately 3,000 gallons per minute, allowing a train of 90 cars to be loaded or unloaded in under five hours. This has the obvious benefit of increased equipment utilization, as well as reduced labor costs, and shorter dwell times at terminals. Additionally, TankTrain cars were built in various sizes and designs to handle various commodities resulting in a wide variety of TankTrain cars roaming the nations’ rails.

TankTrain cars are typically grouped into interconnected sets ranging from two to thirteen cars, the set size varying upon the car types, commodity, and shipper being served. One of the commodities routinely handled by TankTrain cars is crude oil, whose viscous nature, and tendency to be shipped in unit train quantities, lends itself well to the TankTrain concept. The most well-known operation using TankTrain equipment was Southern Pacific railroad’s operation of these cars, on behalf of Shell Oil Company, from a loading facility in Bakersfield, California, to a refinery in Carson, California. This operation began in the early 1980s, and proved to be highly succcesful for Shell, allowing them economical transport of Kern County crude oil to their refinery. Two trainsets were operated, allowing a continuous load/empty cycle to operate between the loadout and the refinery. These trains were comprised of insulated cars with a 23k nominal capacity, grouped into sets of 12-13 cars, with a full train being around 75-78 cars (more or less, depending upon cars that may have been cut out of the individual sets for maintenance). This train proved to be a fairly high-priority operation on the Southern Pacific, mainly stemming from the need to make sure the loaded trains arrived at the refinery on time, in order to prevent production disruptions, as well as to make sure the warmed crude oil (heated as a result of the initial extraction process) does not cool and thicken inside of the car, which would slow down the unloading process.

Although the cars are most commonly associated with the Southern Pacific and their services which took the “oil cans” over the famous Tehachapi loop in the 1980s, the TankTrain has been used on the Alaska Railroad, Canadian National, Vermont Railway, Delaware and Hudson, Grand Trunk, Conrail and others. After a few breaks in service, GATX still lists the TankTrain on their website.

Athearn Genesis just released their newest run of the TankTrain tank cars in HO. These all-new Athearn Genesis models represent 23K-capacity GATX TankTrain represent the 282-series built in 1982. Based upon GATX diagrams, as well as photos and field measurements taken from prototype TankTrain cars at GATX’s West Colton repair facility, these new Genesis models faithfully replicate the prototype details on these cars, including the tank saddles, walkways, manways, brake rigging, and transfer piping. While these cars are most closely associated with Southern Pacific, TankTrain sets comprised of these cars have been, and can be seen in operation across the country. Grand Trunk Western, for example, operated TankTrain cars from the 486-series in the Great Lakes region, hauling fuel oil, in the late 1970s. And despite construction of a pipeline that eliminated the need for Southern Pacific’s original routing of TankTrain equipment, a new TankTrain, operated by Southern Pacific successor Union Pacific along the former SP “Coast Line”, operates to this day with many of the same cars, from a loading facility in San Ardo, California, to a refinery in Carson, California.

We also have the most recent run of the TankTrain from Lionel in O Gauge including the “Oil Can” train set which comes with a Legacy Southern Pacific SD 40T-2 and 4 TankTrain cars. The cars all feature die-cast metal sprung trucks with rotating bearing caps and operating couplers with hidden uncoupling tab, separately applied metal details, flexible hoses between cars, and a flashing red ETD on the end car.

Erie Lackawanna – Or the Railroad Destroyed by Agnes

The Erie Lackawanna Railway (EL) formed on September 13, 1960 when the Interstate Commerce Commission approved the merger of the Erie Railroad and the Delaware, Lackawanna and Western Railroad (DL&W) as a means to cut costs and better streamline operations.

The Erie and DL&W had been steadily losing passengers, freight traffic and money, and they were heavily burdened by years of accumulated debt. These railroads also had very extensive commuter operations, which were steadily losing money. Due to the accumulating debt, the Erie and DL&W had been combining facilities and operations in the mid 1950s, mostly along the eastern end of their systems, along the Hudson River waterfront and across southern New York state. The DL&W route was severely affected by the decline of anthracite and cement traffic from Pennsylvania in the 1940s. The Erie was burdened by the continuing loss of high-tariff fruit and vegetable traffic from the western United States in to the New York City region as highways improved in the 1950s. Both lines were affected by the opening of the Saint Lawrence Seaway in 1959, which allowed ocean-going cargo ships to travel between European, African and South American ports and cities on the US Great Lakes. The DL&W had previously carried much traffic to and from ocean ships, having its own port facilities to Hoboken Terminal on the Hudson River.

In general, the northeast United States railroads, including the EL, were beginning to decline due to over-regulation, subsidized highway and waterway completion, commuter operations, and market saturation. Many factories in the eastern cities closed during the 1960s, followed by the decline of the domestic automobile and steel industries in the 1970s, which further eroded the northeast United States rail industry. At the same time, government regulations came into effect, which prohibited railroads from abandoning long distance passenger service, even though fewer passengers were traveling by rail due to competition from airlines, bus lines, and private automobiles.

Even with heavy competition and over-regulation, the EL did turn profits in the mid and late 1960s through heavy cost-cutting, reduction of parallel services, equipment modernization, suburban industrial development, increased piggy-back trailer traffic, and steady reduction of long-distance passenger train service, which ended on January 6, 1970. The EL was also benefitted by addition rail traffic diverted to the EL due to problems with Penn Central lines. The EL was able to build a state of the art diesel engine repair facility in Marion, Ohio, and they upgraded a large car repair shop in Meadville, Pennsylvania. The EL gained a contract with the United Parcel Service in 1970, which led to the operation of five dedicated intermodal trains daily between New Jersey and Chicago.

On March 1, 1968 the Erie Lackawanna Railroad was renamed the Erie Lackawanna Railway, and was placed under control of Dereco, Inc., which was jointly owned by the Norfolk & Western Railway and Delaware & Hudson Railroads. The N&W intended to maintain control of the EL and potentially include it into its own merged system. At the time, the N&W was debating a merger with the Chesapeake & Ohio Railway, and if that merger went through, the EL would have likely become part of the new system.

All plans with the EL were destroyed by Hurricane Agnes in 1972, along with most of the EL system. Severe flooding hit its southern lines pushing the EL into bankruptcy, and it filed for reorganization in June of that year. Shortly after the bankruptcy the N&W sold off its interests in the company, which was again independent. The EL operated under bankruptcy protection through the mid 1970s. In the spring of 1976, the government created the Consolidated Rail Corporation (Conrail) in order to bring together the several bankrupt and struggling railroads in the region. Erie Lackawanna opted out of the Conrail system, hoping to merge with the Chessie System, but that merger failed due to negotiation breakdown with the labor unions. After the merger talks with Chessie ended, the EL opted to join Conrail in 1976, where much of the original system was abandoned in favor of similar routes, already controlled by Conrail.