type private industry rail transport founded 1981 guilford transportation industries 2006 pan am railways founder timothy mellon headquarters north billerica massachusetts united states of america area served northeast key people timothy mellon david fink david a. fink number of employees 750 2011 parent pan am systems subsidiaries boston and maine corporation maine central railroad company portland terminal company springfield terminal railway company website panamrailways.com pan am railways inc. par formerly known as guilford rail system grs before march 2006 is an american holding company that owns and operates class ii regional railroads covering northern new england from mattawamkeag maine to rotterdam junction new york . the primary subsidiaries of pan am railways are boston and maine corporation reporting mark bm maine central railroad company reporting mark mec portland terminal company reporting mark ptm and springfield terminal railway company reporting mark st ; bm and mec are operated under lease by st. pan am railways is headquartered in iron horse park in north billerica massachusetts . 1 2 it is a subsidiary of portsmouth new hampshire based pan am systems formerly known as guilford transportation industries gti . guilford bought the name colors and logo of pan american world airways in 1998 . contents 1 history 1.1 guilford 1.1.1 abandonments 1.1.2 labor disputes and mismanagement 1.1.3 amtrak conflicts 1.1.4 expansion attempt 1.2 pan am railways 1.2.1 norfolk southern 2 routes 3 locomotive fleet 3.1 heritage locomotives 4 gallery 5 references 6 external links history edit guilford edit guilford logo b & m logo mec logo during much of the twentieth century the trend has been for heavy manufacturing industry to move out of new england making the region primarily a receiver of freight traffic rather than an originator . the ways to make money in the railroad business are to originate freight or carry it a long distance . new england s railroads have long been handicapped by a traffic flow that makes them delivery agents for other railroads and by short distances . practically the longest one railroad haul in new england was boston & maine s b & m route from the hudson river to portland maine 267 miles 430 km less than one eighth of the distance from seattle to chicago on the bnsf railway . 3 a merger consisting of the b & m the maine central railroad mec and the delaware & hudson railway d & h along with one or more other new england railroads was proposed as long ago as 1929 by the interstate commerce commission icc as part of its nationwide merger proposal . frederic c. dumaine jr. president at various times of the new york new haven & hartford railroad nh the bangor & aroostook railroad and d & h proffered much the same idea . the benefits of such a merger would include economies of scale and longer hauls . 3 in 1977 timothy mellon heir of the wealthy and influential mellon family of guilford connecticut teamed up with ex penn central employee david fink to form perma treat a railroad tie treatment company . mellon wanted to acquire a railroad and considered several illinois central railroad and the detroit toledo & ironton railroad . none of those ventures panned out but mellon s interest in railroads continued . 3 the passage of the staggers rail act in 1980 allowed mellon and fink to execute a business plan unlike those of earlier railroads in the region centering on the idea of buying up as many local railroads as possible to create full horizontal integration over new england and the northern mid atlantic states gaining efficiencies of scale . in june 1981 mellon purchased mec and its wholly owned subsidiary portland terminal company then owned by u.s. filter corporation through his holding company guilford transportation industries . 3 4 in june 1983 the b & m became the second piece of the guilford system bringing with it a subsidiary the 6.5 mile 10.5 km springfield terminal railway a former interurban line connecting springfield vermont to charlestown new hampshire . 3 5 the formation of penn central pc in 1968 and its takeover of the nh at year s end had left new england with only one non pc connection to the rest of the country b & m s interchange with d & h at mechanicville new york . the d & h made a logical extension to the guilford system and a necessary one if guilford was to be something more than a terminal company for conrail traffic moving into new england . d & h was surrounded by conrail and not doing well . the state of new york which had financed much of d & h s rehabilitation program approached guilford about acquiring the railroad . in october 1981 the norfolk & western railway which owned d & h through a subsidiary holding company agreed to sell it to guilford . the purchase was completed at the beginning of 1984 . 3 by the time the guilford system was formed the one time multiplicity of connecting railroads had become a single healthy well managed railroad conrail . any new england bound traffic conrail originated would move as far as possible on conrail before being handed over to guilford e.g. to springfield massachusetts rather than buffalo new york and it would move faster . the guilford remained a short haul terminating railroad . 3 abandonments edit guilford s first few years were defined by abandonments labor unrest and strikes and a draconian management style that damaged the company s reputation for some time . the railroad struggled financially to turn a profit and implemented cost cutting measures . 3 guilford then began to shrink its system by eliminating marginal low density routes . mec s mountain division from portland maine to st. johnsbury vermont carried almost no local traffic and served only to give mec a connection with a railroad other than b & m. with the formation of the guilford system it was deemed redundant ; b & m was now part of the family and interchanging traffic with the canadian pacific railway cp at mattawamkeag maine was easier than battling the grades of crawford notch in new hampshire . 3 a section in new hampshire was salvaged and reborn as the conway scenic railroad . similarly the only business on mec s calais branch from bangor to calais maine was at the extreme eastern end which could be reached by cp . service on most of the branch was discontinued and the line was sold to the maine department of transportation mainedot . 3 the remaining service in calais serves a pulp mill in woodland and is operated by st ; mainedot leases a 10 mile 16 km segment between brewer and ellsworth to the downeast scenic railroad . 6 the remaining 85 mile 137 km ellsworth calais segment was leased to the downeast sunrise trail an interim rail trail . 7 mec s rockland branch from brunswick to rockland maine was also on the chopping block and is now part of the maine eastern railroad as was part of the lower road the portland waterville route via augusta maine . 3 labor disputes and mismanagement edit guilford announced layoffs shop closings and pay cuts . mec s maintenance workers went on strike in march 1986 and the strike spread to b & m and d & h. to take advantage of a lower wage scale and more flexible work rules that apply to shortline railroads guilford began leasing portions of the mec and b & m to b & m subsidiary springfield terminal st for operation . this saved money for guilford but angered labor resulting in another more lengthy strike in 1987 . 8 in 1988 an arbitrator on behalf of the icc ruled that guilford could not lease d & h to st and had to abide by pre st labor agreements . 8 the ruling precipitated d & h into bankruptcy . guilford withdrew from d & h and the new york susquehanna & western railway was designated to operate the railroad . 8 in 1991 the d & h was sold to cp rail where it grew into a more prosperous railroad than it had been during guilford s tenure . 3 the philadelphia inquirer later commented that guilford had become the bane of organized labor for a harsh confrontational approach to trimming costs . 8 most railroad executives dismissed mellon as a wealthy heir who suffered from gross mismanagement possessed a willful misunderstanding of the inner workings of a railroad and was a stubborn ideologue . 8 amtrak conflicts edit guilford proved to be an unwilling participant in assisting amtrak on several occasions forcing the u.s. federal government to get involved . the company had two north south routes to canada the d & h line north from albany and b & m s connecticut river line . the d & h line was in better shape so guilford downgraded the b & m route reducing maintenance . complications arose however . b & m and the central vermont railway cv each owned a portion of the route . south of brattleboro and north of windsor vermont cv maintained its track so that good speeds were possible but between those two points was a 50 mile 80 km stretch of b & m track much of it limited to 10 mph 16 km h . amtrak whose montrealer used the route found the slow running intolerable . 8 the train was suspended in 1987 and the icc ordered b & m to sell the windsor brattleboro segment to amtrak which immediately resold it to cv who rehabilitated the track . 8 the montrealer was restored in 1989 on a new route cv all the way from new london connecticut to cantic quebec bypassing b & m entirely . 3 service on amtrak s new downeaster line between boston and portland was delayed when negotiations between guilford and the national passenger carrier slowed due to the former s issues with equipment weight and speed limits . in december 1998 a speed limit of 79 miles per hour 127 km h was agreed upon between both parties with the surface transportation board stb approving it in 1999 . guilford then refused to assist amtrak with any track improvements forcing the stb to deal with guilford on amtrak s behalf . track upgrades were eventually made in 2000 but the proposed 2001 start up was further delayed when guilford refused to allow amtrak speeds in excess of 59 miles per hour 95 km h despite stb approval of 79 mph as well as prohibiting amtrak from operating test trains . again the stb informed guilford that they were in violation of their agreements signed with amtrak . downeaster service finally began on december 14 2001 . 9 expansion attempt edit in 1985 guilford entered into an agreement with norfolk southern railway ns to run trains to st. louis . ns was attempting to win approval of a plan to purchase conrail from the u.s. government and proposed allowing guilford to lease conrail lines to st. louis in order to restore competition that would be lost in the merger . the plan would have allowed guilford to use the conrail mainline from toledo to ridgeway ohio and from crestline ohio to st. louis . guilford would also purchase 955 miles 1 537 km of conrail track and 1 300 freight cars from norfolk southern for 53m . 10 ns did not prevail in its attempt to purchase conrail in 1985 and the guilford plan was dropped . in 1987 guilford also placed a bid to buy southern pacific . 11 the paper industry provides the largest source of business both inbound chemicals clay and pulp although pan am has lost a lot of that business to trucks and outbound paper . rail had when a slightly