and rentals, was estimated at $173,000,000 compared with a net income of $262,000,000 in the corresponding period of 1948.

Class I railroads in June, 1949, had a net railway operating income of $61,263,279 compared with $124,972,863 for the same month in 1948. The corresponding net railway operating income for the first six months of 1949 totaled $312,690,728 compared with $410,932,720 in the same period in 1948.

Net railway operating income represents the amount left after the payment of operating expenses and taxes but before interest, rentals and other fixed charges are paid.

In the twelve months ended June 30, 1949, the rate of return on property investment averaged 3.83 per cent, compared with rate of return of 3.57 per cent for the twelve months ended June 30, 1948.

Revenue Freight Loadings

Loading of revenue freight for the week ended August 13, 1949, totaled 728,029 cars. This was a decrease of 163,247 cars or 18.3 per cent below the corresponding week in 1948 and a decrease of 178,276 cars or 19.7 per cent below the corresponding week in 1947.

Loading of revenue freight for the week of August 13 increased

11,205 cars or 1.6 per cent above the preceding week.

Coal loading amounted to 116,765 cars, a decrease of 74,439 cars below the corresponding week in 1948, but an increase of 8,240 cars above the preceding week this year.

Railway Net Operating Income

Net railway operating income of Class I railroads in April 1949, totaled $64,759,903 compared with $53,168,256 for the same month in 1948, according to reports filed by the carriers with the Bureau of Railway Economics of the Association of American Railroads. The corresponding net railway operating income for the first four months of 1949 totaled $193,261,747 compared with $195,892,402 in the same period of 1948.

Railway Operating Revenues

Based on advance reports from eighty-two Class I railroads, whose revenues represent 80.5 per cent of total operating revenues, the A. A. R. has estimated that railroad operating revenues in July, 1949, decreased 17.7 per cent as compared with the same month in 1948. The estimate covers operating revenues only, and does not take into account substantial increases in operating expenses that have taken place since July, 1948, as a result of increases in wage rates and material prices.

Estimated freight revenue in July, 1949, was less than in July, 1948, by 18.7 per cent, and estimated passenger revenue decreased 15 per cent.

Locomotives In Service

In its "Monthly Comment on Transportation Statistics," issued June 13, 1949, the Bureau of Transport Economics and Statistics of the I. C. C. calls attention to the fact that there has been a marked decline in the number of steam locomotives in service each year since 1944, and a sharp rise in the number of Diesel-electric locomotives. The number of locomotives in service on March 31 of each year from 1944 to 1949 is shown in the following table:

Railroad Construction Indices

The Railroad Construction Indices issued annually by the Engineering Section of the Bureau of Valuation, as revised to include the year 1948, show for that year an over-all increase of 24 points or about 9 percent over 1947.

The 1948 composite index for all accounts is 281, the highest in the history of these indices which go back to the 1910-1914 base of 100.

Grading, involving to a large extent the use of machinery, remained stationary at 145. Rail, track fastenings, and steel rose substantially in 1948, rail being up 16 percent, track fastenings 22 per cent, and fabricated steel in place 18 percent. Ties and buildings still continued their upturn of the previous year increasing about 10 percent in 1948 over 1947. Equipment and machinery were up about 6 percent. The individual indices for certain construction items which are outstandingly high are as follows:,

The composite changes by road and equipment accounts were as follows:

The average for the year 1948 may still not represent the peak price level which has been attained to date in the post-war period as some current prices are above the average of 1948 although there has also been a slight weakening from 1948 price levels in such accounts as grading and lumber.

Motor Transportation

By HARRY E. Boor, Editor

Recent Division 5 Reports on Section 203 (b) (7a) Exemptions

Division 5 during the past several months has issued several interesting reports covering the exemption on motor carrier traffic having either a prior or immediately subsequent movement by aircraft. On March 21, 1949, the Commission's (Division 5) report on the Hazel Kenny Extension-Air Freight, No. MC-5485 Sub. No. 1, involved an application filed in 1947 for a Certificate of Public Convenience and Necessity to operate over irregular routes between airports in Allegheny County, Pa., on the one hand, and, on the other, points in Pennsylvania within 50 miles of such airports, limited to transportation of shipments having either a prior or subsequent movement by air craft. This application was unopposed. There are two airports located within the commercial zone of Pittsburgh, Pa., as defined in the Commission's first supplemental report in Commercial Zones and Terminal Areas, 48 M. C. C. 95. The 50 mile radius applied for would embrace points in twelve counties in and around Pittsburgh, Pa. The Division found that applicants' proposed motor vehicle operations in the transportation of commodities moving on commercial air lines or air express bills of lading and having an immediately prior or immediately subsequent movement by air craft, between the Allegheny County Municipal Airport and the Greater Pittsburgh Airport, located in Allegheny County, Pa., on the one hand, and, on the other, points in Pennsylvania within 50 miles of either such airports, is transportation of property by motor vehicle which is incidental to transportation by air craft within a partial exemption provided by Section 203 (b) (7a), and, as such, is exempt from the certificate or permit requirements of Part II of the Interstate Commerce Act. In this case, Commissioner Patterson dissented in part and it was his opinion that only those operations performed within the area coextensive with the Pittsburgh commercial zone as defined in Commercial Zones and Terminal Areas, 48 M. C. C. 95, should be considered as coming within the partial exemption of Section 203(b) (7a). The remainder of the authority should be denied because of dual operations.

On June 14, 1949, Division 5 rendered a report on Han Jenkins Extension-Air Freight, MC-69671 Sub No. 6. In this case, the applicant sought authority for a Certificate of Public Convenience and Necessity for operation between New York City, points in Nassau, Suffolk and Westchester Counties, New York, those in Bergen, Passaic and Essex Counties, New Jersey, and between all airports now or hereafter established within the described territory, restricted to shipments having a prior or subsequent movement by air. This application was opposed by a motor carrier association and rail carriers. The Division found that:

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'Since the service is also limited to traffic having a prior or subsequent movement by air craft, we conclude that the operations here proposed are within the exemption in question, and, accordingly, that authority to perform them is not required."

In this case, Commissioner Rogers dissented for the reasons stated in his dissent in James Atterholt and Elizabeth Atterholt Common Carrier Application, and did not agree with the conclusions reached in this instant proceeding.

On May 4, 1949, Division 5 issued a report on W. P. Hudgins Contract Carrier Application, No. MC-109237 Sub No. 1, and found that operation by applicant as a contract carrier by motor vehicle of general commodities, with exceptions, over irregular routes, (1) between airfields and airports within 15 air line miles of Dallas, Texas, including Dallas, on the one hand, and, on the other, Fort Worth and Dallas, Texas, and (2) between airfields and airports within 15 air line miles of Fort Worth, including Fort Worth, on the one hand, and, on the other, Dallas and Fort Worth, were partially exempt from regulation under Section 203 (b) (7a) of the Interstate Commerce Act and required no authority. This application was also opposed by certain motor carriers. The Division found that the applicant's proposed motor vehicle operations in the transportation of general commodities having an immediately prior or immediately subsequent movement by air craft and moving on commercial air line bills of lading is transportation of property by motor vehicle which is incidental to transportation by air craft within the partial exemption provided by Section 203(b) (7a): There were no dissents in this particular case.

On June 17, 1949, Division 5 issued a report and order in Bruce C. Koch Common Carrier Application, MC-108663. In this case, the applicant sought authority to serve the Greater Cincinnati Airport on those occasions when it is used as an alternate airport on flights scheduled to and from Vandalia Airport or in connection with shipments routed over air lines requiring facilities which are not available at the local airport. In this application the termini of the routes sought are varying distances from the Vandalia Airport, that is, Dayton is 10 miles south, Springfield, 24 miles east, Sidney, 32 miles north, and Richmond, 40 miles west. The Division stated:

"The mere fact that the proposal involved is restricted to traffic having an immediately prior or subsequent movement by air is not enough, standing alone, to require the conclusion that the proposed motor service is subject to the partial exemption.'

The Division noted that available maps indicate a number of airports as close or closer than the Vandalia Airport to Springfield, Sidney and Richmond. The Division found that applicant's proposed operations in the transportation of shipments having an immediately prior or immediately subsequent movement by air, between the Vandalia Airport, on the one hand, and, on the other, Vandalia and Dayton, and points in the commercial zones of each are exempt from the certificate requirements of the Act. Commissioner Rogers concurred in this case, but stated: