The Mullet Makes Good

If the Atlantic & North Carolina ever gets into a history of U.S. railroads, it will be a footnote to a footnote. It operates 95.82 miles of single track from Morehead City (pop. 3,483) on the coast to Goldsboro (pop. 14,958). Tarheels call it the "Mullet Line," because it used to haul so many fish. Yet last week no U.S. railroad man, seeking to justify private v. State ownership, could have hoped for a neater case than the Atlantic & North Carolina.

A. & N.C. was built (1854) and operated by the State, became a political toy train. At one time in North Carolina it was considered almost as disgraceful to be without an A. & N.C. pass as to vote Republican. In 1904 the State leased the line to Norfolk Southern, got it back in 1935 when Norfolk Southern (in receivership) could not keep up the rent. Under State operation again, the A. & N.C. was a red-ink factory. Only by forgetting about repairs was the State able to hold its four-year deficit down to $57,549.

Tired of losing money, the State (which owns 72% of the stock) offered to sell the Mullet Line to the Southern Railway. Southern made a survey, found that normal crosstie replacements had been made in only six of the past 26 years, politely declined. State officials hid Southern's survey carefully away and started looking for someone who didn't know any better than to buy the road.

They found their man in Harry P. Edwards, a short-line specialist who had invented a gasoline-burning bus-on-rails, established the money-making Edwards Co. (motor railway cars). Edwards agreed to lease the A. & N.C. for $60,500 a year, began operating it under a new company called Atlantic & East Carolina Railway. North Carolinians still wonder whether he knew what a bad bargain he made. A. & N.C. stock was selling for $5 a share--only $1.63 more than the per-share amount of the annual rental he agreed to pay. In the first go days of his lease 14 trains jumped the tracks. Three days after his lease began Great Britain declared war and stopped buying tobacco--the chief crop moved by A. & N.C. to the coast.

But pale, black-browed Harry Edwards plugged away. Firing political jobholders, he saved $45,507 in operating costs the first year. He laid 100,000 new crossties, rebuilt the locomotives, repaired the buildings, bought a new Diesel. Then he helped get the Hatteras Oil Co. to set up offices at Morehead City and start shipping its asphalt by A. & N.C.

The first year, after paying the $60,500 rent, he got by with a $3,975 deficit. Last week he reported his earnings for the second year: a net profit (after rent) of $16,465.

The Mullet Line's future under Harry Edwards looks bright. Specifications for a new Marine air base at Cherry Point call for 32,000 carloads of sand and gravel--more than twice the line's normal annual traffic. Soon to start at Morehead City is a $5,000,000 Marine supply base which will mean still more carloadings.

So confident was Harry Edwards last week that he prepared to pay his 150 employes a 10% wage bonus. The old A. & N.C. stock was quoted at $40--up 700% since Edwards took over.

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