Jerry Summers: The Railway Express Agency (1917-1975)

Wednesday, June 3, 2020 - by Jerry Summers
Jerry Summers
Jerry Summers

In 1917 the United States government created a national monopoly which provided for transportation by rail for small package and parcel delivery using the national infrastructure interstate road system and FedEx as the primary aviation carrier along with UPS.

The creation of REA arose out of governmental concerns which originated during World War I pertaining to the movement of parcels, goods, and money.  REA was one of the entities created to address these issues and it remained a viable business until 1975 when competition from the tractor trailer and aviation industries made it outdated. It was forced into bankruptcy in November of that year.

By 1900, four principal express parcel businesses that used the existing railroad structure operated in competition with each other. During World War I seven express companies were consolidated as the United States Railroad Administration (USRA).  However, in the South the Southern Railroad system was excluded from the nationalization of the system.

In 1929 the Railway Express Agency (REA) was created by combining three companies into one freight railway entity.  The REA had a monopoly and unique setup whereby it was the sole express business to move goods via rail and the railroads transported freight cars.  The REA shipped a wide variety of products including animals, hazardous materials, explosives, and even fruits and vegetables.

The most profitable period for the REA was World War II but the railroad industry in general began to diminish after the war.  With increased competition from Federal Express in the late 1950’s, the REA continued to have financial difficulties. 

Its service expanded into piggy back and intermodal container and truck trailer movements in the 1960’s which provided some short-term relief but that also failed to produce sufficient income to sustain the business.

In 1969 the Railway Express Agency was sold to five of its officers and renamed as the REA Express, but unfortunately it continued to decline in profits.  Eventually they declared bankruptcy and the company exited the railroad transportation industry.

During its heyday the green trucks of the company were a familiar sight on the streets and highways of Tennessee and elsewhere. It maintained business locations at both the Union and Terminal railroad stations in downtown Chattanooga.

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Jerry Summers

(If you have additional information about one of Mr. Summers' articles or have suggestions or ideas about a future Chattanooga area historical piece, please contact Mr. Summers at jsummers@summersfirm.com  

 

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