Most Significant Diesel Electric Locomotive of All Time

[Desertdweller]

Equipment trusts had a big influence on locomotive life cycles.  One of my college professors (who was a railfan) told me he remembered seeing lines of NYC Hudsons and Niagaras in storage out of service.  The railroad, in a rush to Dieselize after WWII, replaced its near-new steam locos before they had been paid off.  Since these engines were security on money owed to an equipment trust, the railroad did not have clear title to them and could not scrap or sell them.  They had to be kept in serviceable condition to preserve their value.

Apparently, the railroad saved so much operating money by replacing them with Diesels that it made financial sense to sideline these near-new steam locos.

I don't think equipment leases on locomotives were widespread until the 1980's.  I know of no first-generation power that were lease units in the 1950's.  There has been a lot of leasing of first-generation units, but these were purchased second-hand and rebuilt by the leasing companies.  These were/are typically leased to smaller railroads.  It can make sense for these railroads to lease if they do not own repair facilities capable of overhauling a unit.

Les

[RAM]

I don't know when NYC dieselized.  I do know that when I was in the navy in1952 they were still running the Hudsons and Niagaras in Indiana.  I am sure that the hudsons had been paid off you before that.  Most railroads keep steam locomotives around for some time after dieslizing.  It is too bad that they didn't save one of each of them.

[jward]

I don't think equipment leases on locomotives were widespread until the 1980's.  I know of no first-generation power that were lease units in the 1950's.  There has been a lot of leasing of first-generation units, but these were purchased second-hand and rebuilt by the leasing companies.  These were/are typically leased to smaller railroads.  It can make sense for these railroads to lease if they do not own repair facilities capable of overhauling a unit.

Les

leases existed long before the 1980s. emd had a leasing arm called elmo leasing. I know for a fact that pennsy gp9s, gp9bs, and sd9s were leased from elmo. a large group of them were returned to lessor in 1981 when the lease ran out. lease turnbacks became common in the 1980s when the economy was bad and railroads had long lines of stored power. it made more sense to let the lessor take back the locomotives and run the ones owned outright, than to buy out the lease on a group of locomotives probably in need of a heavy overhaul. in many cases, companies like helm either held the paper on those locomotives, or bought them dirt cheap. this was how the big lease fleets we see to-day, with large numbers of identical locomotives,  got started