>>1940041>because they didn't realise just how fucked they were in that sector.So their immediate response would be an even greater version of what they did IRL with regard to diesels/streamliners/terminal renewals/service alterations, because most of them would not yet believe the cause to be hopeless. They would also do this (to a greater extent) with freight service, netting higher productivity and lower operating costs, attaining a more competitive industry and thus higher market share. Admittedly, the LTL market would be far less sensitive to this.
>then usage is actually decliningThe point is not whether decline was occurring (it obviously was) but rather the rate/time profile of decline. Steam locomotives, for example, which were truly and inherently obsolete, were almost entirely gone by 1960. And by lowering operating costs, their diesel replacements made certain routes more viable than they otherwise would've been. It's not like gas rationing was lifted after World War II and everybody immediately abandoned railroads for cars and trucks.
>>1940041>with massive investment into new infrastructure Which they couldn't do even to the extent that they wanted because they were getting abysmally low rates of return on capital, owing to the constraints they had to operate under. Changing that system would give them greater flexibility to adjust revenues and optimize their cost structure. Look at the chart in
>>1939893. Over the time period from the tail-end of the Great Depression to the postwar economic boom, one of the leading railroads was unable to get revenue growth that matched expense growth. They even cut 10% of passenger mileage in a year, yet that didn't substantially move the needle on net income because of how unwieldy their expense profile and strained their freight revenues were.
