Baldwin Locomotive Works

By the time Matthias Baldwin died in 1866, his company was vying with Rogers Locomotive & Machine Works for the top spot among locomotive producers. By 1870 Baldwin had taken the lead and a decade later, it was producing 21⁄2 times as many engines as its nearest competitor, according to the U.S. Manufacturing Census.

In 1897 the Baldwin Locomotive Works was presented as one of the examples of successful shop management in a series of articles by Horace Lucian Arnold. The article specifically described the Piece Rate System used in the shop management.

Burton (1899) commented, that "in the Baldwin Locomotive Works... piecework rates are seldom altered... Some rates have remained unchanged for the past twenty years, and a workman is there more highly esteemed when he can, by his own exertions and ability, increase his weekly earnings. He has an absolute incentive to increase his output as much as he possibly can, because he knows that he will not, by increasing his own income, lead to cutting piece-work rates, and so be forced to make still further exertions in order to maintain the same weekly wage."

History: 20th century

Initially, Baldwin built many more steam locomotives at its cramped 196-acre (0.79 km2) Broad Street Philadelphia shop but would begin an incremental shift in production to a 616-acre (2.49 km2) site located at Spring Street in nearby Eddystone, Pennsylvania, in 1906. Broad Street was constricted, but even so, it was a huge complex, occupying the better part of 8 square city blocks from Broad to 18th Streets and Spring Garden Street to the Reading tracks just past Noble Street. Eddystone had a capacity of well over 3000 locomotives per year. The move from Broad Street was completed in the late 1920s.

Gilded age

The American railroad industry expanded significantly between 1898 and 1907, with domestic demand for locomotives hitting its highest point in 1905. Baldwin's business boomed during this period while it modernized its Broad Street facilities. Despite this boom, Baldwin faced many challenges, including the constraints of space in the Philadelphia facility, inflation, increased labor costs, Labor tensions, the substantial increase in the size of the locomotives being manufactured, and the formation of the American Locomotive Company, an aggressive competitor which eventually became known simply as Alco.

From 1904 to 1943, Baldwin and Westinghouse marketed Baldwin-Westinghouse electric locomotives and A.C. electrification of railroads, particularly to the New Haven Railroad.

In 1906 the Hepburn Act authorized greater governmental authority over railroad companies, and revitalized the Interstate Commerce Commission (ICC), which stepped up its activities. The ICC was given the power to set maximum railroad rates, and to replace existing rates with "just-and-reasonable" maximum rates, as defined by the ICC.

The limitation on railroad rates depreciated the value of railroad securities, and meant that railroads stopped ordering new equipment, including locomotives. The Panic of 1907 in turn disrupted finance and investment in new plants. Both of these events had a direct negative effect on the railroad industry, especially the locomotive builders.

Baldwin's locomotive output dropped from 2,666 in 1906 to 614 in 1908. The company cut its workforce from 18,499 workers in 1907 to 4,600 the following year. Baldwin's business was further imperiled when William P. Henszey, one of Baldwin's partners, died. His death left Baldwin with a US$6 million liability. In response, Baldwin incorporated and released US$10 million worth of bonds. Samuel Vauclain wanted to use these funds to expand Baldwin's capacities so it would be prepared for another boom. While other Baldwin officers opposed this expansion, Vauclain's vision won out; Baldwin would continue to expand its Eddystone plant until its completion in 1928. By 1928, the company moved all locomotive production to this location, though the plant would never exceed more than one-third of its production capacity.

World War I

Baldwin was an important contributor to the Allied war effort in World War I. Baldwin built 5,551 locomotives for the Allies including separate designs for Russian, French, British and United States trench railways. Baldwin built railway gun carriages for the United States Navy and manufactured 6,565,355 artillery shells for Russia, Great Britain and the United States. From 1915 to 1918, Remington Arms subcontracted the production of nearly 2 million Pattern 1914 Enfield and M1917 Enfield rifles to the Baldwin Locomotive Works. Baldwin expanded its Eddystone, Pennsylvania works into the Eddystone Arsenal, which manufactured most of these rifles and artillery shells before being converted to locomotive shops when the war ended.

Following the war Baldwin continued to supply export orders, as the European powers strove to replace large numbers of locomotives either worn out or destroyed during the war, as European locomotive factories were still re-tooling from armaments production back to railroad production. In 1919 and 1920 Baldwin supplied 50 4-6-0 locomotives to the Palestine Military Railway that became the Palestine Railways H class.

Decline

After the boom years of World War I and its aftermath, Baldwin's business would decline as the Great Depression gripped the country and diesel locomotives became the growth market on American railways towards the end of the 1930s. During the 1920s the major locomotive manufacturers had strong incentives to maintain the dominance of the steam engine. The Baldwin-Westinghouse consortium, which had produced electric locomotives since 1904, was in fact the first American locomotive builder to develop a road diesel locomotive, in 1925. Its twin-engine design was not successful, and the unit was scrapped after a short testing and demonstration period. Westinghouse and Baldwin collaborated again in 1929 to build switching and road locomotives (the latter through Baldwin's subsidiary Canadian Locomotive Company). The road locomotives, Canadian National class V1-a, No. 9000 and No. 9001, proved expensive, unreliable, frequently out of service, and were soon retired. Westinghouse cancelled its efforts in the diesel locomotive field with the onset of the Great Depression, opting to supply electrical parts instead. The early, unsuccessful efforts of Baldwin-Westinghouse in developing diesel-electric locomotion for mainline service led Baldwin in the 1930s to discount the possibility that diesel could replace steam. In 1930 Samuel Vauclain, chairman of the board, stated in a speech that advances in steam technology would ensure the dominance of the steam engine until at least 1980. Baldwin's vice president and Director of Sales stated in December 1937 that "Some time in the future, when all this is reviewed, it will be found that our railroads are no more dieselized than they electrified". Baldwin had deep roots in the steam locomotive industry and may have been influenced by heavy investment in its Eddystone plant, which had left them overextended financially and operating at a fraction of capacity as the market for steam locomotives declined in the 1930s.

In contrast, ALCO, while remaining committed to steam production, pursued R&D paths centered on both steam mainline engines and diesel switch engines in the 1920s and '30s, which would position them to compete in the future market for diesel locomotives.

In 1928 Baldwin began an attempt to diversify its product line to include small internal combustion-electric locomotives but the Great Depression thwarted these efforts, eventually leading Baldwin to declare bankruptcy in 1935. At the invitation of the owners of the Geo D. Whitcomb Company, a small manufacturer of gasoline and diesel industrial locomotives in Rochelle, Illinois, Baldwin agreed to participate in a recapitalization program, purchasing about half of the issued stock. By March 1931 the small firm was in financial trouble and Baldwin filed a voluntary bankruptcy for Whitcomb with Baldwin gaining complete control and creating a new subsidiary, the Whitcomb Locomotive Company. This action would lead to financial losses, an ugly court battle between Baldwin and William Whitcomb, the former owner of the company, and bankruptcy for both parties.

Baldwin lost its dominant position in electric locomotives when the Pennsylvania Railroad selected General Electric's design for what became its GG1 class instead of Baldwin's design in 1934.

When Baldwin emerged from bankruptcy in 1938 it underwent a drastic change in management, which revived the company's development efforts with diesel power, but it was already too far behind. In 1939 Baldwin offered its first standard line of diesel locomotives, all designed for yard service. By this time, Electro-Motive Corporation (EMC) was already ramping up production of diesel passenger locomotives and developing its first diesel road freight locomotive.

As the 1930s drew to a close, Baldwin's coal-country customers such as Pennsylvania Railroad, Chesapeake & Ohio, and Norfolk & Western, were more reluctant than other operators to embrace a technology which could undermine the demand for one of their main hauling markets. All three continued to acquire passenger steam locomotives into the early postwar years, as dieselization was gaining momentum elsewhere in the rail industry.

In the late 1930s Baldwin and the Pennsylvania Railroad made an all-in bet on the future of steam in passenger rail service with Baldwin's duplex-drive S1 locomotive. It proved difficult to operate, prone to slipping, costly to maintain, and unsuited for its intended service. Baldwin developed a revision of the same basic design with the T1, introduced in 1943. While the T1s could operate on more tracks than the S1, they still had many of the problems of the S1, and additional mechanical problems related to their unique valve design. The whole S1-T1 venture resulted in losses for PRR and investment in a dead-end development effort for Baldwin at a critical time for both companies. In the early 1940s Baldwin embarked upon its efforts to develop steam turbine power, producing the S2 direct-drive turbine locomotive in 1944. Baldwin's steam turbine program failed to produce a single successful design. Baldwin's steam-centered development path had left them flat-footed in the efforts necessary to compete in the postwar diesel market dominated by EMC and Alco-GE.

World War II

The United States' entry into World War II impeded Baldwin's diesel development program when the War Production Board dictated that Alco and Baldwin produce only steamers and diesel-electric yard switching engines. The General Motors Electro-Motive Corporation was assigned the task of producing road freight diesels (namely, the FT series). EMC's distinct advantage over its competitors in that product line in the years that followed World War II, due to the head start in diesel R&D and production, is beyond doubt, however, assigning it solely to WPB directives is questionable. Longtime GM chairman Alfred Sloan presented a timeline in his memoir that belies this assumption, saying that GM's diesel-engine R&D efforts of the 1920s and 1930s, and its application of model design standardization (yielding lower unit costs) and marketing lessons learned in the automotive industry, were the principal reason for EMC's competitive advantage in the late 1940s and afterward (clearly implying that the wartime production assignments were merely nails in a coffin that Baldwin and Lima had already built for themselves before the war). In his telling, the R&D needed to adapt earlier diesels (best suited to marine and stationary use) to locomotive use (more flexible output; higher power-to-weight ratio; more reliable given more vibration and less maintenance) was a capital-intensive project that almost no one among the railroad owners or locomotive builders was willing (latter) or able (former) to invest in during the 1920s and 1930s except for the GM Research Corporation led by Charles Kettering, and the GM subsidiaries Winton Engine Corporation and Electro-Motive Corporation.

Baldwin made steam engines for domestic US railroads, the US Army, British railways, and made around one thousand E or Ye type engines for the Soviet Union in the Lend Lease arrangement (of an order of 2000 or so engines with other builders contributing to the total).

Baldwin obtained a short-term market boost from naval demand for diesel engines and the petroleum crisis of 1942–43, which boosted demand for their coal-fired steam locomotives while acquisition of EMD's diesel locomotives was in its most restricted period.

In 1943 Baldwin launched its belated road diesel program, producing a prototype "Centipede" locomotive which was later rebuilt to introduce their first major product in the postwar market.

During World War II Baldwin's contributions to the war effort included not only locomotives and switchers but also tanks. Baldwin was one of the manufacturers of several variants of the Light Tank M3 (M3A2, M3A3, M3A5) as well as the Medium Tank M3 (Lee and Grant) and later the M4 Sherman (M4, M4A2). The company also built the M6 Heavy Tank, a prototype trialed by the US Army which never saw operational use.

A Baldwin subsidiary, the Whitcomb Locomotive Company, produced hundreds of 65-ton diesel electric locomotives for the Army and received the Army–Navy "E" Award for production. Baldwin ranked 40th among United States corporations in the value of wartime production contracts.

End

Between 1940 and 1948, domestic steam locomotive sales declined from 30 percent of the market to 2 percent. By 1949, there was no demand for steam locomotives. Baldwin's attempts to adapt to the changed market for road locomotives had been unsuccessful; the reliability of their offerings was unsatisfactory, epitomized by notorious failures such as its Centipede diesel locomotives and their steam turbine-electric locomotives, which proved to be money pits unsuited for their intended service. In July 1948 Westinghouse Electric, which had teamed with Baldwin to build diesel and electric locomotives and wanted to keep their main customer in the rail industry afloat, purchased 500,000 shares, or 21 percent, of Baldwin stock, which made Westinghouse Baldwin's largest shareholder. Baldwin used the money to cover various debts. Westinghouse vice president Marvin Smith became Baldwin's president in May 1949. In a move to diversify into the construction equipment market, Baldwin merged with Lima-Hamilton on December 4, 1950, to become Baldwin-Lima-Hamilton. However, Lima-Hamilton's locomotive technology was unused after the merger and market share continued to dwindle. By January, 1952 Baldwin closed its factory in Rochelle, Illinois and consolidated Whitcomb production at Eddystone. In 1953 Westinghouse discontinued building electrical traction equipment, so Baldwin was forced to reconfigure their drive systems based on General Electric equipment. In 1954, during which time they were being virtually shut out of the diesel market, Baldwin delivered one steam turbine-electric locomotive to the Norfolk & Western, which proved unsatisfactory in service.

The last batch of conventional steam locomotives built by BLH were WG class 9100-9149 as BLH 76039-76088 built in 1955 for the Indian Railways broad gauge.

After locomotive production ended, Hamilton continued to develop and produce engines for other purposes. Baldwin engine production was shifted to the Hamilton plant, but in 1960 the Hamilton engines ceased production, the plant was shuttered, and Baldwin engine production moved back to Eddystone. The last locomotives produced by Baldwin were three experimental RP-210 dual power passenger locomotives for the New York Central and New York, New Haven, & Hartford rail lines in 1956.

In 1956, after 125 years of continuous locomotive production, Baldwin closed most of its Eddystone plant and ceased producing locomotives. The company instead concentrated on production of heavy construction equipment. More than 70,500 locomotives had been built when production ended. In 1965 Baldwin became a wholly owned subsidiary of Armour & Company. Greyhound Corporation purchased Armour & Company in 1970, and the decision was made to liquidate all production. In 1972 Greyhound closed Baldwin-Lima-Hamilton for good. The replacement and renewal parts business was acquired by Ecolaire Inc and became the Baldwin-Hamilton Company - A Division of Ecolaire Inc. and lasted till 1991 to receive license fees from other companies using their designs, which was lucrative. When the licenses ran out, all remaining parts were distributed, and the company dissolved.