The rash of mergers had a similar effect on the face of railroading in general, and the demise of the weaker diesel builders led to greater standardization in motive-power as well. Fairbanks-Morse ended production in 1963. Alco threw in the towel in 1969. Baldwin-Lima-Hamilton had built its last locomotive way back in 1956. That left General Electric and Electro-Motive Division, the latter still the dominant force in diesel-building.
The look and mix of units on the diesel-ready tracks changed radically between 1960 and 1980. Streamlined "cab-unit" diesels were everywhere, wearing the classy, multicolored schemes created in many cases by EMD stylists. "Hood units" -- preeminently Alco's RS3s (RS for "road switcher") and EMD's GP7s and later, GP9s (GP for "general purpose") -- were essentially the same under the skin as the cab units, but with better visibility and easier access to machinery.
The next evolutionary step was to "chop" the short hood for better forward visibility, an innovation of the early 1960s that would typify diesel aesthetics for the next two decades (until the boxy, blunt "safety cabs" of the 1980s). Streamlining and fancy paint schemes seemed superfluous in this hunkered-down era of railroading, characterized by boarded-up depots, abandoned branch lines, and weed-infested rights-of-way. First-generation diesels from all the builders joined steam trains in the scrap yards. Utilitarian "chop-nosed" units in a limited number of basic models from EMD and GE were the locomotives appropriate to this era of dramatically lessened expectations. For much of the industry, particularly in the East and Midwest, where the traffic base had eroded badly, survival was virtually all that could be hoped.
But even in these dark days, when the future looked bleak indeed, railroading had begun to reinvent itself. Diesel standardization, and perhaps the example of locomotive pooling that occured naturally in mergers, led to increased power run-throughs from one railroad to another -- an efficient and time-saving practice. Intermodal traffic (trailers and containers on flatcars, otherwise known as TOFC and COFC)-became a significant growth sector, doubling between 1965 and 1980, with the greatest explosion still to come.
Railroads began to exploit other niches with "unit trains" of a single commodity, such as grain or coal. (In 1979, in a rare example of route expansion, Burlington Northern opened its new Powder River Line, tapping rich coalfields in Wyoming.) Centralized traffic control, an idea that was already many decades old, became the norm, along with welded rail.
Railroading is an old-line industry, capital-intensive and labor-intensive, with a thoroughly unionized workforce. Though every gain was won only after a fight, essential work-rules rationalization was begun. The process of eliminating firemen on locomotives, for instance, started as far back as 1964. Crew operating districts, based on divisions that often dated back to railroading's early days (and thus resulted in operating crews receiving a day's pay for a few hour's work) in some cases were revised.
In the final months of 1980, several important events occurred. In December, The Pullman Company was dissolved as a legal entity (though it had ended its staffing of sleeping and parlor cars 11 years earlier), and Northwestern Steel & Wire in Sterling, Illinois, dropped the fires on its refugee fleet of steam locomotives -- engines that this huge scrapyard had chosen to operate, squeezing out a last few useful miles before melting them down for razor blades. This was the last daily, non-tourist steam operation in the United States.
Less than two months earlier, on October 14, President Jimmy Carter had signed into law the Staggers Rail Act, partially deregulating the railroads. This event was significant. It was the go-ahead for the railroad industry, however dramatically redefined and slimmed down, to "highball it" once again.