Could someone explain the Pullman Company business model to me?

Did Pullman pay the railroads to haul their cars? On one hand it seems like they would have, as they were running their own "hotels."

But OTOH, the railroads benefited from having the Pullmans on the train; those passengers, I assume, had to buy from the railroad a regular ticket as well as the Pullman one; so the sleepers being in the consist helped the railroads sell regular tickets, plus provided customers for the dining car.

Briefly, how did the money flow?

Please remember that Pullman lasted about 100 years. There won't be a single "business plan" for them over that length of time, and their relations with different railroads also varied. Very large lines and very small ones had different needs, resources, etc. And some lines operated their own sleepers. Pullman also had competition until 1899/1900, when it took over the Wagner Sleeping Car operation of the New York Central and Hudson River and its subsidiaries. It only became the virtual monoply we knew it as after that time.

A good place to start is the chapter on passenger service (chapter 7) in Principles of Railroad Transportation By Emory Richard Johnson, Thurman William Van Metre, 1918, which can be found on-line in its entirity at:

https://books.google.com/books?id=zi4pAAAAYAAJ

This is a very basic overview of Pullman's services and how they were provided. Ron makes an excellent point: Pullman remains one of America's longest functioning corporations, and its business model evolved many times between the 1860s and the end of its sleeping car services in the 1960s. It lasted into the 1990s as a manufacturing company and an owner of intellectual property.

There are a number of papers written on Pullman looking at the anti-trust implications of its mid-20th century business model. One of the later ones (from 1992) may be found here - https://link.springer.com/article/10.1007/BF00158142- which would be helpful in identifying earlier works.

I always assumed the railroad and the Pullman Company each charged the customer and that there was no money transfer between them.

The railroad required that a first-class ticket (much more expensive than coach) be purchased to ride in a sleeping car, and the customer also had to buy "space" from Pullman. (Both tickets were sold by railroad ticket agencies and other agents, not Pullman.)

On board, for trains with two or more Pullman sleepers, there was a Pullman Company conductor in addition to a railroad conductor. Generally the railroad conductor and the Pullman conductor would walk through the train together, each collecting his "own" ticket. On trains with only one sleeper, the Pullman porter collected the Pullman ticket.

I think that Pullman wanted to collect their own tickets so they could make sure the agent that sold the ticket (often a railroad employee) sent the money (perhaps less a seller's fee) on to Pullman.

Hi Pete!
I haven't read the cited article (which I intend to do) but I think it may have been a bit more involved, at least in the case of lines with marginal traffic. Roads with a history of running their own sleepers tended to continue to do so on marginal lines; as an example, on the Soo Line, Chicago-Duluth was a Pullman line, while St. Paul-Sault Stainte Marie never was, and Chicago-Ashland once was a Pullman line that was changed to company owned sleepers during the thirties. This begs the question what roads that weren't interested in running their own sleepers did for low traffic lines; a minimum per trip guarantee, perhaps?

In addition, there was the issue of painting Pullman owned cars custom colors to match consists, and a surcharge during the thirties for air conditioned equipment.

I seem to recall reading something that the railroads would guarantee a certain level of revenue to the Pullman Company to provide service between certain end points.

Also read that the Pullman company would have a porter in-charge when they did not assign a their own conductor. This porter in charge might even be used for two or three cars. This meant that the Porter in-charge had more paperwork to do; he would get a small increase over the usual pay rate; however, the total was nowhere near the pay rate of a Pullman Conductor. This was a point of contention for the porters. [There was a color line between the Conductors and the Porters.]

Thanks for the responses. Tom, that link was very helpful.

I've now learned that the railroads paid the Pullman Co. (generally a mileage rate) to use the Pullman cars on their trains. This generated sales of first-class tickets sold by the railroads, and such tickets were required by anyone wishing to buy a Pullman berth. Having these people aboard also generated dining car business.

The Pullman Company, separately, sold Pullman tickets for the actual accomodations. So they got that revenue on top of what the railroads paid for using the cars. A Pullman conductor dealt with the Pullman tickets, not the railroad's regular conductor.

In some contracts, the Pullman Company would forgive some/all of the mileage charges once a certain level of revenue from Pullman tickets was reached on that particular train.

At one time the fare to ride in a Pullman Car was called the Standard Fare, rather than First Class. From the 1930's to the 1950's there was also a Tourist Fare, valid in Pullman's Tourist Cars, which were downgraded older heavyweight cars.* The Coach Fare was considered a discounted fare below the Standard or Tourist Fares. Some specific discounted fares, such as Clergy, were equivalent to Standard Fares and valid in Pullman space without a step-up. Later the term "First Class" replaced "Standard" for the highest railroad fare.

If you look at timetables from that era, you will see cars listed as "Standard Sleeping Cars" which were the ones where the Standard Fare applied. Tourist Cars were listed as such. Tourist Cars fell out of use when the railroads bought Reclining Seat Coaches and the old heavyweight Pullmans wore out.

The Railroad Ticket Office sold both Railroad and Pullman tickets although not all Agents or Clerks were authorized to sell interline or Pullman tickets.

Finally, Slumbercoaches were Pullman-operated cars** that accepted Coach tickets plus a Pullman space charge. [A full 24-8 Slumbercoach brought the railroad 40 Coach fares, while a full 10-6 Pullman brought 22 Standard fares.]

Phil Mulligan

* MILW had built new Tourist Cars for the Olympian Hiawatha.
** NYC after 1957 operated its own on-line sleeping cars and NYC called these cars Sleepercoaches.

How were Pullman reservations/space managed?

Did Pullman have a central reservation office (or regional ones)? Or did each railroad handle reservations for "their" sleepers? How would this have been handled for interline sleepers?

Pullman reservations and space were handled by the operating railroads. This ran the gamut of having specific space on a specific car assigned to a specific station every day or on certain days. The RR Agent there could sell the space. If another station needed the space they could wire the Agent who held the space to release it to them.

For example, the Agent at Wayne Junction might have been assigned roomette 5 on train 329 to Toronto. If he needed another roomette or a bedroom, he would have to obtain it from another Agent, such as Reading Terminal. If, say, Jenkintown needed the roomette, that Agent could contact Wayne Junction to see if theirs was sold.

Or most likely a hybrid where some space was assigned to the stations while more was in a central pool, managed by the Passenger Department.

Alternately, some roads had central reservation centers and every agent contacted the central bureau for the space.

After the train had left the station, the Pullman Conductor or Porter in Charge could sell unsold space. The Train Conductor would handle any RR transportation ticket step-up (i.e. Coach to Standard/First Class)

No i-phone scanning in those days.

Phil Mulligan

I have seen instructions as to how the Western Railroads handled space assignments available for sale. Most of these had one or more central reservation offices. However certain space would be assigned to other major locations or sales offices (city or major depots).

On the day of departure all unsold space was transferred back to the central office. The central office would then release available space by a set of instructions to either down-route depots or the train conductor. As the train passed these locations there were instructions as to either release the space to further down-route depots or to the train conductor.

A Union Pacific conductor on the "City of Los Angeles" train would arrive in Los Angeles with reservation diagram cards from not only Chicago, but also locations like Omaha, Cheyenne and Salt Lake City each indicating what they had available to sell and actually sold.

And the common 12 Section, 1 Drawing Room heavyweight sleeping car would generate 26 or 27 rail fares.

The ATSF Agent in Barstow had diagram cards for certain cars showing the space he controlled. If he needed something he did not have on his own diagrams, he told me he could get the space from another Agent in the direction the train was coming or from Topeka.

Reservations beyond ATSF always went to Topeka.

Phil Mulligan