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Baldwin Locomotive Works: Evolution of the American Locomotive, 1907

A Superior Company

As an industry pioneer, the superior experience of the Baldwin Works gave it flexibility and adaptability during the erratic period following the war. Its Philadelphia location gave major benefits with ready access to financial operators, a skilled labor pool, a close relationship with the Pennsylvania Railroad and proximity to the lines hauling coal—the lifeblood of this Second Industrial Revolution—from the state's mining areas. Baldwin became the primary locomotive producer during the Gilded Age of fortune-making. Competitors fell away as the economy see-sawed through the economic uncertainties and panics of 1873, 1893, and 1907.

At the turn of the century, the railroads were booming, mechanical design had improved greatly, and moves were afoot in the locomotive industry to form cartels which would co-operate in an effort to combat uncertainties in the industry and, not coincidentally, to fix prices. Baldwin did not join these groups. They eventually failed, unable to realize the economies of scale in a constantly changing market.

In 1906, its banner year, Baldwin produced 2,666 engines, working around the clock with seventeen thousand shift workers. This performance prompted the construction of a new satellite plant in Eddystone, 15 miles from downtown Philadelphia, to handle the anticipated extra work. Baldwin's timing was bad, however, as this move coincided with the beginning of the steam train's decline.