RailTex was a transportation

holding company A holding company is a company whose primary business is holding a controlling interest in the securities of other companies. A holding company usually does not produce goods or services itself. Its purpose is to own shares of other companies ...

that specialized in owning and operating short line

railroads Rail transport (also known as train transport) is a means of transport that transfers passengers and goods on wheeled vehicles running on rails, which are incorporated in tracks. In contrast to road transport, where the vehicles run on a prep ...

across North America. Based in

San Antonio ("Cradle of Freedom") , image_map = , mapsize = 220px , map_caption = Interactive map of San Antonio , subdivision_type = Country , subdivision_name = United States , subdivision_type1= State , subdivision_name1 = Texas , subdivision_t ...

Texas Texas (, ; Spanish language, Spanish: ''Texas'', ''Tejas'') is a state in the South Central United States, South Central region of the United States. At 268,596 square miles (695,662 km2), and with more than 29.1 million residents in 2 ...

, the public company was a leader in making unprofitable lines shed by

Class I railroads In the United States, railroad carriers are designated as Class I, II, or III, according to annual revenue criteria originally set by the Surface Transportation Board in 1992. With annual adjustments for inflation, the 2019 thresholds were US$5 ...

into viable transportation routes. The company was taken over by

RailAmerica RailAmerica, Inc., based in Jacksonville, Florida, was a holding company of a number of short-line railroads and regional railroads in the United States and Canada. In 2007, RailAmerica was acquired by Fortress Investment Group. Before that, it ...

in February 2000.

History

RailTex was founded in December 1977 by Bruce Flohr as a business that leased rail cars. Flohr had invested $50,000 of his own money and had investor help for another $50,000 from investors. Flohr had started as a Southern Pacific train-crew brakeman in 1965 and rose to superintendent of Southern Pacific's San Antonio Division until he became deputy administrator of the

Federal Railroad Administration The Federal Railroad Administration (FRA) is an agency in the United States Department of Transportation (DOT). The agency was created by the Department of Transportation Act of 1966. The purpose of the FRA is to promulgate and enforce rail s ...

in 1975. Seeking to broaden the revenue base, he purchased the San Diego & Imperial Valley Railroad. Operating the railroad the company quickly developed a formula for a series of successful takeovers, including: *Taking over only railroads where he could operate on a non-union basis - RailTex trains operated with two employees paid $10 to $15 an hour while union trains operated with three to four paid an average of $25 an hour. RailTex employees were called transportation specialists or "transpecs," *Deploying three marketing managers rather than the usual one for the line and then marketing to businesses five to 10 miles from the track as opposed to the usual next-to-the-track customers *Purchasing older locomotives which could be acquired for a fraction of the cost of new locomotives. In 1986 it acquired its second short line, Austin & Northwestern Railroad.In 1989 it sold its rail car business to

Chrysler Stellantis North America (officially FCA US and formerly Chrysler ()) is one of the " Big Three" automobile manufacturers in the United States, headquartered in Auburn Hills, Michigan. It is the American subsidiary of the multinational automot ...

. By 1991 it operated 1,500 miles of track in 12 states with 60 locomotives. RailTex went public in 1993 trading on

Nasdaq The Nasdaq Stock Market () (National Association of Securities Dealers Automated Quotations Stock Market) is an American stock exchange based in New York City. It is the most active stock trading venue in the US by volume, and ranked second ...

under the sign RTEX. In 1996, RailTex was part of a consortium with

Companhia Vale do Rio Doce Vale S.A., formerly ''Companhia Vale do Rio Doce'' (the Sweet River Valley Company, referring to the Doce River) () is a Brazilian multinational corporation engaged in metals and mining and one of the largest logistics operators in Brazil. Vale ...

that was awarded a concession to operate the 4,400-mile Center Eastern Network in

Brazil Brazil ( pt, Brasil; ), officially the Federative Republic of Brazil (Portuguese: ), is the largest country in both South America and Latin America. At and with over 217 million people, Brazil is the world's fifth-largest country by area ...

. Later the same year, in a consortium with

GP Investments GP Investments (also GP Investimentos), is a leading alternative investment firm in Latin America with a strong presence in asset management, principally private equity funds. The firm's shares are listed on the Luxembourg Stock Exchange and tr ...

it won a further concession to operate the Southern Network. The Brazilian interests were sold in 1999. In February 2000, the company was taken over by

. It had 26 railroads over approximately 4,100 route miles in the southeastern, midwestern and

New England New England is a region comprising six states in the Northeastern United States: Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont. It is bordered by the state of New York to the west and by the Canadian province ...

regions of the United States, as well as Eastern Canada and Mexico.RailAmerica to Acquire RailTex, Creating World'sLargest Short Line/Regional Freight RailroadOperator
''

Business Wire Business Wire is an American company that disseminates full-text press releases from thousands of companies and organizations worldwide to news media, financial markets, disclosure systems, investors, information web sites, databases, bloggers ...

'' October 14, 1999

References

{{Reflist Canadian railroad holding companies Companies formerly listed on the Nasdaq Railway companies established in 1977 Railway companies disestablished in 2000 United States railroad holding companies 1977 establishments in Texas 2000 disestablishments in Texas