Freight Car Friday – Per Diem Boxcars

20 07 2012

In the 1970s, America’s railroads became awash in colorful boxcars from previously unheard of shortlines all around the country. Bold colors and graphics were a common feature of these fleets making them popular at trackside and on model railroads – but where did they come from and where have they gone?

Like the colorful “Billboard Reefers” from the early years of the century, the real story behind these cars has nothing to do with their paint and everything to do with railroad operations and economics.

Per Diem Charges

Vermont Ry

The Vermont Railway rostered one of the larger fleets of per-diem short line cars.

Railroad equipment is a major investment. It didn’t take long for some railroads to catch on to the fact that since these investments could easily change hands they needed some incentive to get them back! Or at least to make some money on them while they were away.

Loaded cars are generally billed to the customer based on the total mileage of the route. The railroad that delivers the car is responsable for collecting the payment and disbursing the funds back to the other carriers in the route. They must then also send the empty car off for another load. This can be on the railroad that owns the car, but it doesn’t have to be.


Even if you’d never heard of the railroad before, it usually wasn’t hard to figure out where the short line was located even if the car was thousands of miles away. The LEF&C is just one good example from northwestern Pennsylvania.

To prevent the railroad from simply sitting on the car for days, weeks or even months at a time, the car owner can charge a per diem, or daily, fee for the car for as long as it is off their home rails. These per-diem charges aren’t as high as the income that could be received from a loaded car movement but they do add up! So a railroad has a great incentive to either find a load for any empties in its yards (preferably headed in the general direction of the “home” road) or to move the empty car back to the owner asap.

This is a very general overview of how the system works, but it is sufficient for most of our modeling interests and needs.

The Boxcar Shortage


The Columbus and Greenville heritage of this Hinsdale Southern car isn’t hard to spot, despite now working for its third owner!

Beginning in the late 1960s and into the 1970s, the railroads began to face a shortage of good general service boxcars – still a staple of the industry. With struggling revenues over the previous decade, many railroads had held back on new car orders. Thousands of cars still in service were too short, to light in capacity or simply to derelict to handle loads efficiently.

Changes in the regulations governing the return of empty cars meant that railroads could collect more money from off-line movements on those “per diem” charges. These rules applied mostly to railroads – not private car companies. So investment companies partnered with shortlines all across the country to build and supply cars to what became essentially a nationwide pool of general service boxcars, similar in operation to the Railbox pool created by Trailer Train.


The lettering on this former Corinth and Counce car is still readable, although the bold yellow and blue paint colors have diminished.

By using the shortlines, the cars could be handled under railroad rates as opposed to private company cars. And the shortlines could take in a share of the per diem profits on cars that would probably never see their home rails! In fact, some railroads owned more cars than could even have fit on their property had they all come home at once.

Some railroads did take the concept a little farther. The Maryland and Pennsylvania Railroad, now part of Evans Transportation, established a rebuilding facility to refurbish older cars and add to their pool. These projects became the main revenue source for the railroad, whose winding mainline between York, PA and Baltimore, MD had been shrinking in size and profit for more than twenty years.

Where Did They Go?


This Abbeville Grimes Railroad car is like many of the per-diem cars today. Although the easy clues to its exact heritage are painted-over, we can still identify it as a car from the period and even its manufacturer (SIECO) from its construction features.

Almost as quickly as they came, the colorful cars started to disappear in the mid 1980s. Again, supply and demand had a lot to do with it. Growth in intermodal shipments and a continued decline in boxcar movements had a large part in the process.

Most of the cars did not simply “go away” however. They are still plying the rails today and will until their forty-year service lives are up in the not-to-distant future. Most have changed hands, often several times, from their original owners. Some have gone to other shortlines, others to large leasing companies like General Electric which uses the reporting marks of their East Erie Connecting Railroad (EEC). Still others have been purchased by some of the larger carriers.


Some cars have been modified with roof extensions, new doors and other features. A “prototype kitbash” project!

Through all of these exchanges, the cars have seen a variety of paint treatments from simple “patches” of new numbers and reporting marks to complete repaints. Almost always, the repainted cars are now a simple color scheme. Along the way, some cars have also been rebuilt with increased heights, special loading equipment on the interior, ventilation, etc. Without knowing a few spotting features, or better yet some more detailed histories of individual car fleets, these cars can be impossible to spot.

You will still find the occasional car with its gaudy original paint intact, but the decades of service have taken their toll. But thankfully, those colorful cars can live on much longer on our layouts!



2 responses

20 07 2012

Thanks LLC for the information makes one appreciate even more what the RR’s do!!!!!

22 07 2012
keith morton


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