Builders of Wooden Railway Cars ... and some of other stuff

Terre Haute Car & Mfg. Co.

As with so many of the early companies, there seems to be some question as to the correct name of this company. Newspapers of the day often referred to it as the Terre Haute Car Works Company, and we have seen it referenced as the Terre Haute Car Works, the Terre Haute Car Company and the Terre Haute Car Manufacturing Company. But there is an 1884 court case involving the company {133} that uses the name above. While there is no guarantee the lawyers got the name correct, it seems to be the best evidence available.

The Terre Haute Car & Manufacturing Company originated in 1867 with the partnership of Seath, Smith & Company at Terre Haute, on the Wabash River in west central Indiana. We don’t know who Mr. Smith was, but that is of little consequence, because within six months it had become Seath & Hager. Seath was James Seath and Hager was John B. Hager. As was so common to businesses of the time, the business was probably referred to as the Terre Haute Car Works, and they began by building freight cars for the Vandalia Railroad {453} at the rate of one flat car per week. {452}

Somehow they weathered the financial panic of 1873, that left the national economy in shreds for more than five years. One source {453} says it was during this time (1875 to be exact) that the company became a joint-stock concern. Another {452} says it was at the end of this time (1878 to be exact) that the company was incorporated.

Capital stock was established at $50,000 (close to $1 million in today’s money), all paid in, and business got increasingly better. We don’t know what their actual production was in 1879, but their estimate toward the end of that year was some 1,600 box, stock and flat cars at the rate of eight cars per day, employing 300 men with a weekly payroll of $2,500. {452} An 1879 newspaper {134} reports that the Illinois Midland Railroad was having 100 new cars built at the Terre Haute car works.

In 1880, the company officers were John B. Hager, president and treasurer; James Smith [possibly the same Smith as that of the original partnership], vice-president and superintendent; and L.G. Hager, secretary. {452}

In February 1883, the company’s property on South 13th Street was inundated when the nearby Wabash River flooded twice within a period of 10 days. {132}

Just four years later, the entire works, with the exception of the “foundry department” was destroyed by a fire of unknown origins. Mr. Seath, then president of the company, estimated the loss at $100,000, with insurance of between $50,000 and $60,000, At that time, the works employed 750 men. {135}

The works was promptly rebuilt, and by 1890 Terre Haute was so pressed by orders that they were working a day and a night force, working on an order of 300 coal cars for the Mackey lines. {136} Prosperity was wonderful! By 1893, Terre Haute employed more than 900 men and did an annual business of more than $3 million. {131}

But Terre Haute received a double whammy in 1893.

To begin with, the stock market crash in June took down a great many railroads, together with the industries that supplied them. In July, Terre Haute went into voluntary bankruptcy (“assignment”) due to the “stringency in the money markets, the most direct cause being the failure of Post, Martin & Company of New York, car trust bankers, who were unable to carry out obligations and meet payments on cars furnished.” Terre Haute’s assets were $599,083, of which $195,000 was the plant, $110,000 was cars and materials on hand, and the remainder was receivable [which could probably never be collected]. Liabilities were $191,165, with an additional $84,608 in contingent liabilities (being indorsements [sic] for Post, Martin & Company). The company made it clear to all that it had not a dollar of indebtedness to any banks anywhere. {131}

Then, less than a month after entering bankruptcy, the entire property was destroyed by fire. Due to the unsettled state of the company’s affairs, it was impossible to state the loss, but insurance on the buildings and materials amounted to $150,000. {132}

At a mass meeting 19 August 1893, 1,000 out-of-work former employees volunteered to work clearing away the debris and rebuilding the plant, waiting as much as a year to receive their wages, if necessary. But with business conditions being what they were (it would be almost four years before they were back to normal) the company was forced to decline the offer. {136}

Yet less than a year later, Terre Haute’s President, Louis J. Cox, is quoted as saying, “I bid against Mr. Pullman, and was surprised at the figures at which he took the contracts. They were far below mine, and I made mine very low, owing to the times.” {137}

By October 1894, the plant was apparently at least partially rebuilt, as the company was employing “about two-thirds the usual good times force.” {138}

Nine months later, Terre Haute “as reorganized,” had paid off 75% of its debt and was actively working on the other 25%. It was turning out the plant’s greatly reduced capacity of five cars a day, working on an order of 100 for the Big Four company. {139}

Two months later the company was contemplating extensive improvements to its plant. A planned car erecting shop 343' long by 157' wide, together with a planing mill 300' long by 144' wide, would make it “much larger” than before it burned. The company was then working 150 men 10 hours a day: much less than in its pre-1893 heyday. {140}

An 1895 report noted, “The Terre Haute Car Works Company announces that on the 1st of February the works will be started at nearly full capacity, after two years’ idleness. The plant has been enlarged and improved, and before long more than 1,000 men will be employed” {141}

In 1899, Terre Haute was one of the companies merged into American Car & Foundry.

From William Travis, A History of Clay County, Indiana, p. 102 at :

“Beginning with the year 1892 the passenger cars manufactured for the Vandalia Railroad were equipped with the “American Car Door,” set in plush, to facilitate easy movement and break the force and noise attending the closing, of which John L. Wagner, an employe of the Terre Haute Car Works, was the inventor. Wagner was a native Clay countian. He was also the inventor of the sleeping-car bearing the “Wagner” name.”

If you can help us understand this paragraph, please write us.

Cast of Characters

James Seath (1827-1891+) was born in Edinburgh, Scotland. He emigrated with his family to the United States at age six, settling at Albany, New York. He learned the machinist’s trade, and when he became of age [1848?] he went to work for the Hudson River Railroad Company in New York City. After about two years, he accepted a position as engineer [this seems to have been a mechanical position as opposed to a locomotive driver]. He stayed with this road about 5 years. {454}

Seath next [1853?] became master mechanic on the Hudson & Berkshire Railroad. He held this position about 5 years also. He then [1858?] moved to Bloomington, Illinois, where he became a machinist and engineer for the Chicago & Alton Railroad. He held this position about two years also. {454}

And here we have an anachronism. The more recent [1891] of our sources {453} says Seith next took a job as master mechanic in the Terre Haute & Alton shops at Litchfield, Illinois, staying two years and then returning to Bloomington. There is simply not enough time to fit this in. Since these sources are both “vanity biographies,” a genre of so-called history wherein subjects are interviewed, written up and then sold their stories as part of a “history book.” When Seith told the first writer his story, either the chronology was fresh in his mind (he would have been 53 years old) or the writer had a concern for chronological accuracy. When he was interviewed by the second writer (he was then 64) possibly things were becoming a bit fuzzy, and the writer was either not counting the years, didn't care enough to push for accuracy, or not going to dispute a possible buyer of his book.

In any event, both sources {454} agree that Seath next (1860?) went to work for the Missouri Northern Railroad as engineer at their shops at St. Charles, Missouri, shortly becoming foreman and then master mechanic. According to the later source, {453} he received his appointment as master mechanic just a few days after the firing on Ft. Sumpter [14 April 1861]. He is said to have been the only “officer” of that road sympathetic to the Union cause.

About 15 months later, (1862), Seath returned to his previous position with the Terre Haute & Alton at Litchfield, and there he stayed until 1867, when he moved to Terre Haute. {454}

John B. Hager (c1823-1880+ ) was born in Hagerstown, Maryland. His family moved to Terre Haute when he was about 12 years old. We know nothing of his early education, but we know he attended West Point Military College and served the Union in the Civil War. {452}

11 April 2006

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