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Jon's Corner

A Look Back In The History of "Trailways"


Jon's Corner

These Comments are from posts to Trailways_Bus_Driver

> Let's all welcome our newest member to our group. Thanks for joining. Make yourself at home.

Thanks, I think I'll like it here. >

We would like to know a little about you, so we can all get to know each other. You can't tell much from a e-mail address

Started in the bus business in 1958 with American Buslines, Inc. (the Burlington end), then was with Tamiami Trailways, Capitol Trailways of Pennsylvania, Safeway Trailways, Pacific Trailways and then started my own company, Blue Ridge Trailways. Over the past 42 years I've serviced buses, checked bags, sold tickets, been an information clerk, a bus driver, DSM, v-p of traffic and owner.

Jon Hobijn



[Dick Shelley was saying]

> As for Curry, one has to consider he was one of two who litererally "bankrupted" Greyhound in about '87.

Teets at Dial is the one who "set" the whole thing up. Peter Picknelly at Peter Pan looked at buying GLI before Curry and came away shaking his head, "...they'd say how much they wanted but couldn't tell you what you'd get. Now we know, nothing!" Curry paid $385 million for what was worth at most $125 million. Teets kept everything of value, even the name "Greyhound" and running dog symbol, all the decent real estate, etc. Currey got an on going business and 400 aging buses, the rest were all leased. Teets got in cash what it was worth, the interest as long as they were paying it and when it went bankrupt wrote the rest off as a loss and told the stockholders.. "I did my best, the guy just couldn't run it." Curry's plan was to take the company public while retaining control for himself. Unfortunately, there were no assets to speak off an a tremendous debt and the SEC would allow it. In the meantime, in a deal cooked with fraud, he negotiated to buy TWI from Henry Hillman. The final purchase price for TWI was $85 million and he got more hard assets with TWI than he did when he bought GLI !!!

Curry couldn't keep his mouth shut and started saying everything was jake and the GLI driver's union, who had given back for the past 3 contracts said, "now it's our turn." Unfortunately, what Curry didn't tell anyone, even owning TWI, is that if he had filled every seat on every bus, ever day for every mile, there still weren't enough seats available to sell to bring in the money needed to pay for his leveraged debt. The strike didn't help things, but Curry's bad business deal and Teet's thievery are what cooked Greyhound before the ink was dry. > Additionally, he and Lentzch profited greatly with the demise of Greyhound, Trailway, Inc., Bus Lease, and probably other transportation properties. I'm sure there will be others that will challenge me on this; but if you weren't there, you don't know. I was there and I knew all the players personally. Lentzsch isn't really the heavy that you think he is. Everyone was scared to death of Curry and the only one who would stand up to him was Lentzsch. Craig became the lightning rod. Curry is the consumate listener, but after you've answered his question, he doesn't want to hear you arguing about again. Finally with Lentzsch, he blew up and said as much as, "who do you think you are, I taught you everything you know about buses. That's when they parted company. Later, when the secured creditors took control of Greyhound (Security Pacific Bank and others), and after Frank Schmeder had done his damage, they brought Lentzsch back in, (1) because he was the only person qualified to run Greyhound who knew anything about the company and (2) he was the one everyone mentioned when they said, ";;;; I wish Craig were here again." >

I know that in the past roughly ten years, Lentzsch has (on the surface) pulled Greyhound back together; but it's only time before the other shoe drops and he walks away smelling like a multimillion dollar rose...again.

When Greyhound was part of Dial they had no debt and returned 7% on equity. As long as Greyhound is saddled with heavy leveraged debt, there isn't enough return in the line haul bus business to service it. Keep in mind that while the air lines over the past 50 years have been able to get their seat/mile costs to a fraction of what they were, the bus company's costs per seat/mile have gone up. Buses still carry roughly the same numbers of people, diesels get the same fuel mileage, but everything associated with operating a bus has increased without being able to spread it over more people on board. >

I guess I better shut up before someone comes to Modesto and shoots me. I look forward to hearing what others have to say. Not me. I hope I've said something interesting. I have a lot of good memories of the industry along with a lot of bad ones, but I've know just ab out all the big players on a first name basis. One last thing...I really miss the old Continental system.

I do too. You may be interested to know that when Holiday Inns was in the process of selling TWI to Henry Hillman (with Jim Kerrigan to run it), M. E. Moore in Dallas had put together the financing to buy it back and had Charlie Webb, his lawyer up in Memphis at Holiday Inns to make the offer. The deal was cooked with Hillman/Kerrigan though and Charlie Webb called Moore back in Dallas and said, "...Mr. Moore, they won't even let me beyond the reception area to present my offer." To that we can only say, ".....oh, God!"

Jon Hobein



Hi Ken and everyone,

I have to make a confession to all of you, I'm prejudiced. Since the first time I saw a red and cream Trailways bus I was a fan. Greyhound was interesting and the Scenicruiser was sexy, but.. Trailways was always my first love. I never wanted to be just a bus driver or a Greyhound bus driver, I wanted to be a Trailways bus driver and no one was prouder than me the day I put on the blue uniform and started driving for Tamiami Trailways in 1969. I worked a run from Miami to Orlando, part of a Miami to Boston schedule, driving all Safeway and TNE Model 05 Eagles, red and cream with white wall tires and I made sure that the people who rode with us got the finest ride so they could tell their friends that Trailways had treated them right. Being the first driver out of Miami also meant that the south Florida passengers riding through were happy when I passed them on in Orlando. So, when you see me write something, you'll know I'm not objective, I loved the company I worked for and I'm still proud to say I was a Trailways bus driver....

> ...,I'd always wondered about what went > wrong with the greyhound -trailways > deal, other than a reason to kill off a > competitor and be the only kid on the > block with all the toys...

When Curry couldn't take Greyhound public, he was desparate to find some way to generate more revenue and it was pretty common knowledge that Henry Hillman was sick and tired of TWI's losses under Kerrigan. However, TWI was NOT broke and not at the end of their rope. When the sale was announced, TWI still had enough cash in the bank -- without taking in another cent in revenue -- to make their next payroll. What's more, Hillman had been telling Kerrigan to pare TWI back to the old Continental, where they were VERY strong in Georgia, Tennessee, Mississippi, Arkansas, Louisiana, Texas, Oklahoma, Missouri, Kansas, Colorado, etc. Of course, Kerrigan's ego couldn't stand the thought of presiding over a mini-empire, he had to "get" Greyhound. Unfortunately, the only bus business Kerrigan knew was Greyhound. His idea was if you had the same route, you just matched all Greyhound's service and the people would ride. RIGHT ;-/ Most of you no doubt remember his disasters in California, the Pacific Northwest and Florida where he tried that and ran so many empty miles it looked like he was deadheading buses. Curry made the TWI purchase fly with the DoJ using the failing company doctrine -- that TWI was going bankrupt and so the competition would be gone regardless of whether they approved the sale or not. He also maintained that there were no other buyers for TWI. The DoJ held no hearings, solicited NO comment from the public or industry and Curry furnished "Wall Street" opinion on TWI....... unfortunately that was fraud, because a number of us had offers on the table for parts of TWI......... Trailways Southeastern - purchase offer from Blue Ridge that they wouldn't even respond to Virginia Stage Lines - purchase offer from Carolina Coach Trailways of New England - take over by Peter Pan Tamiami Trailways - purchase offer from Capital Trailways and Journey Tour & Travel Safeway Trailways - purchase offer from the principals who had owned Body Rite Hmmmm, I believe that's the east coast isn't it? Does that look like there were no purchasers for TWI? However, the deal with Hillman was cooked in secret, no one ever knew about us, in fact, only three people in Dallas knew about Curry's plans, Kerrigan, Lesko and Ben Robinson, the treasurer. That's how quiet they kept it. Five years later, a DoJ lawyer was talking to me and on finding this out said the word "fraud" immediately. I almost screamed and then he told me the statute of limitations was four years!

> what's a sad commentary is under the right circumstances big red as a whole could have been saved.

Absolutely. If Kerrigan had concentrated on running TWI right, concentrating on making it the finest bus company where they were strong, the mid-west, southwest, deep south and Atlantic Coast, he could have absolutely kicked Greyhound's ass. Greyhound is not and never was a well run company. The only thing they've ever had going for them is their "brand" and the running dog symbol that equated with the words "Kleenex," "Jello" and "Frigidaire." That was one of Kerrigan's huge f--k ups, he thought all you had to do was put a bus on the road, he didn't realize that Trailways, we really worked at being a bus company. Unfortunately, because TWI's spending was always ahead of their income, everything centered on the revenue shortfall. They raised the minimum fare to $4.00 and killed every bit of their local business, they raised package express rates across the board and started running that off, they raised intrastate passenger fares in places like Colorado where they owned the store and raped their customers..... and ran them off, the business died and they started selling assets and coverting them to operating capital. A good fix, but it only works once. Don't know how many knew it, but they owned the terminals in Atlanta (yes, the big fancy one) and DC, for example, 100% and sold them and spent the money. The Washington Terminal went for more money than they paid for the company ;-(

> well at least the name still stands and > a lot of the ... members ... still > carry the pride, the tradition, they > couldn't buy that nor could they kill > it...

Well, they are rebuilding it. Unfortunately, greed and stupidity (thinking there was such a thing as a free lunch) almost let Curry kill it and that's exactly what he set out to do when he bought TWI.

Jon



> okay i know this is a touchy subject but when did the final end come for trailways, iam talking after the merger which was 88 or 89 i belive,was the shutdown gradual?,immediate?

After the buyout, Greyhound continued to belong to the Trailways association. Years earlier, stupidly, the members of the association had allowed the by-laws to be changed so that the number of votes each company had depended on their revenue, thus the bigger the company, the more votes they had. In that situation, Trailways, Inc. controlled the association and Kerrigan essentially ran it like it was his private property. With the buy-out, Curry did the same. This is the way he screwed Peter Pan and kept them from coming in the association until after the bankruptcy. This sort of thing, combined with the revenue sharing arrangement that Greyhound entered into with Carolina and Southeasatern, insured that the association was split up and couldn't join together to compete with Greyhound. Of course, Carolina and Southeastern were loathe to have anything screw up their sugar deal with Greyhound so they sabotaged any attempts to put the system back together again, especially on the east coast. Beyond those two companies, Martz came out smelling like a rose in Wilkes-Barre and Scranton where they became Greyhound's agent and essentially controlled the show. Not only did Marty Kramer from Southeastern and Bill Steele from Carolina keep Greyhound up to date on everything going on amongst the other Trailways companies, but Frank Henry made a weekly phone call to inform on everyone to Greyhound in Dallas. In short, those three had cooked their deal and couldn't care less what happened to any of the rest of the members. They watched as my company got screwed, watched as Curry burried Journey Trailways in Florida, watched as Cascade got killed running from Seattle to Sacramento, Scenic running from Chicago to Pittsburgh, etc. We may not have had the original Judas, but we damn sure had three of his closest relatives.

> ...or swift and deadly,when did the affliates pull out?

The other members didn't "pull out." Because membership dues in Trailways is based on revenue, when Greyhound went into bankruptcy they owed the Trailways association many thousands of dollars in back dues and because they were unaable to pay up.... and knew they'd effectively killed "Trailways" as a viable name to compete with them, they left the association. The association quickly changed some of the by-laws to prevent anyone from taking control again, but the core of "good ole boys" who were always on the board made sure they kept control..... i.e. Steele from Carolina, Berardi from Adirondack, Henry from Martz, Kramer from Southeastern and Hamilton from Captial/Colonial. Essentially they ran the association like it was their private club and the rest of us just paid dues and did what we were told. ......... and you guys thought it was a great big neat, tight-knit family. Closer to Payton Place I'd say. Steele from Carolina hated my company for some reason and never missed an oppotunity to cause us harm or trouble... unless one of his buses was broken down in Asheville (happened constantly) and then their people wanted us to bail them out.

> when did companies like abl and virgina stages, trailways tennessee,etc? actually close their doors?

I'm not sure the corporate shell and certificates aren't still in existance, but it was a moot point when Greyhound ceased to be a member of Trailways. Of course, since they bought Carolina from Wallner and Redfield in Nevada (the two guys who purchased it from Philips and raped it), they are now back inside the Trailways association.

> what I am trying to do is get a time frame here of the passing of a grand old girl,

The first thing Curry did when he bought Trailways, Inc. is to set about killing the Trailways name. He did this with his advertising that said Trailways and Greyhound were the same company..... and that's the perception the public bought. Of course, he had no write to say "Trailways" (and not the particular company he bought) was "one" with Greyhound because that drug all the rest of us in the with the deal, but, again, he controlled the association and did what he wanted. Like when the deal first went down and at a meeting where he was present, it was brought up that Peter Pan had applied for membership (that was set up by Kerrigan, but it's a story for another time). Curry came right out and said "....if you think I just paid $85m for Trailways (as if he owned the name) and that I'm going to set some other s-o-b up with "my" name between Boston and New York, you're nuts, but go ahead and have your silly vote and then I'll vote and we'll move on to other business." We all watched Peter get screwed and could do nothing about it. Likewise, in Florida, Curry's people made quick work of Journey Trailways who had just come in the association and ran them into bankruptcy. Now Journey was the greatest operation in the world, but they didn't deserve to have someone run them out of business. What we found out was that when we got a call on our "Trailways" number in Jacksonville, Savannah, Charleston, Columbia or Charlotte, (they were all answered by our people in the Charleston office, the people knew they'd called a Trailways number but their perception was that it was just another way to get Greyhound information..... and because Greyhound's information centers wouldn't answer their phones, we were swamped with calls for Greyhound service going the opposite direction from where we ran. That's what I meant when I said that Curry first set out to kill the name with the public. > if anyone wants to each tell their experences at the end id appreciate it,if i opened up any old sore wounds or brought back any bad memories i apoligize but at least here on this board and in this forum the real story gets told straight and gets told right Well, there's some of what happened. I know I sound very bitter and I guess I am. I stood there and watched another man take what I started on my kitchen table and was doing $5.5m a year and just tear it apart and I was helpless to do anything about it. Most of this is only known to a few of us who were in the middle of it, it isn't pretty, but you deserve to know what happened cos it was your life-time of work and service that went to hell too. The big cats (both Greyhound and some other Trailways members) didn't care what they did to people like you and I. If any of you have some questions you've always wondered about, let me know. It;s not that I'm so darn smart, I was just caught up in the middle of it and watched it first hand.

When Curry first bought Trailways, Inc., we had a Trailways meeting in Washington, DC to discuss our worst nightmare. At that point Carolina and Southeastern had already cooked their sweetheart deal on revenue sharing and were in Curry's pocket. Curry wasn't at that meeting. I was sitting next to George Cullens from Georgia Trailways (one of the nicest guys you'll ever meet) and he turned to me, while all the fat cats like Steele, Kramer, Berardi, Hamilton and Henry were over come with greed and were hollering about the advent of the "free lunch,", George turned to me and said, "Jon, the whole thing is to hell in a hand basket." And you know what, he was absolutely right. It was. I had to catch a flight back to Asheville and as I walked out of the hotel past the telephones, Steele (whose got a mouth the size of North Carolina) was on the phone with Brenda, his secretary in Raleigh, trying to get Curry's phone number in Dallas to report to him on what was going on in the Trailways meeting. Kind of makes me sick to my stomach to even bring the memories back up. i pass these things along so you'll know the dirty secrets as best as I can sort the memories. I loved Trailways from the time I was 10 years old. I never wanted to do anything but drive a Trailways bus and some of my best memories were of those days, wearing my blue uniform and driving those red and cream buses. I never ever considered working for Greyhound, not even once.

Your brother,

Jon



Could you elaborate more on the Holiday Inns-Kerrigan-Teets- Curry-TWI connections?

1. Holiday Inns and Continental Trailways actually started as a result of Juan Trippe at Pan American World Airways and M. E. Moore at Continental trying to put their two companies together. They got an "unofficial" reading from the DoJ that the government would frown on that merger, so they tried coming in the back door. It was figured that Holiday Inns would buy the bus company and then merge with Intercontinental Hotels owned by Pan Am and by that method Pan Am and Continental would be able to merge. By the time Holiday Inns bought Continental, Pan Am's fortunes had soured and so the grand plan was stopped dead in its tracks. Holiday Inns was a very singularly focused company, if it didn't concern beds and bed bugs, they weren't interested and about a year into their ownership of the bus company, they figured out that big red and cream buses weren't going to be stopping at Holiday Inns every night and from that point on, their grand plan was to prime the bus company for sale and dump it.

2. Fred Curry's uncle was the head honcho at Beneficial Finance, part of M. E. Moore's financial network that helped him buy Bowen Motor Coaches. Curry and Floyd Clymer, later of Holiday Inns worked together at Beneficial Finance. That's how Moore and Curry knew each other. Curry was Moore's financial adviser as far as investments went. When M. E. Moore was buying all the east coast companies in the mid-60's, Fred Curry was Moore's financial and negotiating representative to the those companies, principally Claud Jessup at Virginia Stage Lines. When Holiday Inns bought Continental, Moore was supposed to be in Memphis every Monday morning as it was Holiday Inn's policy to have all their CEO's there for a strategy and planning meeting. Moore hated the meetings and instead of going would send Curry in his place. Instead of representing Moore personally, he shot him in the back with Holiday Inns management and that's why all of a sudden Moore was gone from the bus business without anyone releasing he'd left. Curry became CEO of Continental and hired a fellow named Kevin Murphy from Purolator to run the bus company. So years later when Curry bought Trailways, Inc., he was no stranger to the organization, he'd been there once before.

3. Holiday Inn's one goal with Continental was to sell the bus line and also Delta Steamship Lines that came with it. Finally, in 1979, James Kerrigan who'd been recently fired by Greyhound, was looking for a way to get back at his old bosses and talked Henry Hillman, a Pittsburgh investment banker into buying Continental or Trailways, Inc. from Holiday Inns.

4. Kerrigan could only be described as certifiable and an ego-maniac. Couple that with a sole desire to "get" Greyhound, and you had a recipe for disaster. Kerrigan only knew the bus business from the perspective of Greyhound, which didn't put him in contact with reality and his champagne taste and beer budget brought Trailways, Inc. to ruin. Hillman told him to pare Trailways, Inc. back to a situation where it could exist in exclusive operating territory (i.e. Alabama, Mississippi, Louisiana, Tennessee, Arkansas, Missouri, Kansas, Colorado, Texas, etc.) and to sell the rest off. Kerrigan's ego couldn't handle a diminished size and while doing what Hillman had told him, quietly sabotaged every sales opportunity that arose. Finally, in disgust, Hillman responded to overtures from Fred Curry who had recently purchased Greyhound from Dial Corp. and negotiated a sale to Curry. Only Kerrigan, Lesko and Ben Robinson in Dallas knew what was going on because they had to furnish Curry financial and operating information. 5. Curry bought Trailways, Inc. for $85 million and got more hard assets than he did when he bought Greyhound from Dial for $385 million!

I was going to get the old issue of NBT article on "Five years under Kerrigan", but think you're account might be more accurate.

Also, could your give a bit more historic info about Michaud?

A bus company that began in the late 1920's in Salem, MA using a Model T Ford with a custom made bus body. In later years, Alex Michaud was the president but the man who started it was actually Alex's wife's father... their family name was also Michaud. They operated the city bus service in Salem, later bought a regional commuter line named York Lines that ran from Sanford, ME to Boston. Kerrigan talked them into taking over the Boston-Portland route and joining Trailways in 1980. The line was a disaster for them, weakened them financially and then some later poor decisions by younger brothers put the company under. Michaud Bus Lines exists again, but this time its run by Spike Michaud and it is a bus sales company and operates a limited charter fleet.

Jon



Lest any of you think that I'm the smartest rabbit in the woods, my comments on what had transpired from M. E. Moore to Fred Curry was a combination of personal knowledge, and information from Tom Champion, Fred Curry, Floyd Holland, Marvin Walsh and Malcolm Myers. I'm somewhat uncomfortable with folks thinking I'm smarter than what I really am.

BTW, in 1979, M. E. Moore had the financing in place to buy back his bus company... at the same time Holiday Inns was talking to Henry Hillman and James Kerrigan. The Hillman deal took the front seat and the people at Holiday Inns wouldn't even talk to M. E. Moore's lawyer, a fellow who'd represented the ABA for years named Charlie Webb. Look how close things came to being very different.

Jon



[G.L. asked] > I know I'm a little dense so please don't laugh at me (I'm not very familar > with the NTBS. I'm a St. Louis-Cape man) ]

Nobody laughs and you aren't dense, lots of this stuff is something that was not widely known.

> ...but does this explanation connect Continental Airlines with > Continental Trailways???

They didn't have anything to do with each other beyond sharing a common name, "Continental." The link between Juan Trippe's Pan American World Airways came when Pan Am owned Intercontinental Hotels and was looking to diversify  in travel related fields.  There was intereest in Continental Trailways not so much because of potential bus-air passengers but because Continental Trailways was a well run company with a lot of potential who also happened to own Delta Steamship Lines out of the port of New Orleans, an early pioneer in container shipping whose principle market was South America, one of Pan Am's big markets.

> And I've always been curious why they dropped name "Continental" > off Trailways. ???

Their advertising agency told them that the name, "Continental Trailways" was too long for good recognition with the public andf that one of the names should be dropped.  This came about 1973-74.  They decided to test and see which was the more recognizable name with the public, "Continental" or "Trailways."  Of course the bunch in Dallas just KNEW that "Continental" would be the better known.  SURPRISE, most of the survey respondents said "...Continental who?"  Thus, the decision to drop the name "Continental." At the same time, mid-70's, they decided to change the company name and the association allowed them to become known as "Trailways, Inc."  Dick Maguire told me years later that, at the time, having had the "Continental" name shoved down their throat for years, the other members welcomed the change. Actually,  it wes a stupid move (Dick's opinion along with mine) because afterwards it "seemed" that Trailways, Inc. WAS Trailways and the rest of us were just tag-alongs.  It allowed Fred Curry, years later, to be able to say that he'd bought "Trailways," when in reality, what he'd bought was the old Continental.  ;-/

Jon