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Ontario Southland Railway


Guelph Junction Railway Reporting mark: OSRX

The city of Guelph was first formed around 1827. It began with the arrival of John Galt, an entrepreneur and novelist from Scotland. Galt built a log home near Priory Square and gradually a community began to spread out around his homestead. His son, Alexander Tillich Galt, became a politician and early railway promoter. The younger Galt was involved with the initial development of the Grand Trunk Railway (GTR) and later on with industrial railways in Alberta. By the 1850s, Guelph was firmly entrenched in the centre of what was about to become Ontario's industrial heartland.

Located a little less than 100 kilometres southwest of Toronto, Guelph owes its early growth and prosperity to the arrival of railways. The first one to lay down tracks was the GTR mainline in 1856. It was followed in 1857 by the Galt & Guelph Railway (GGR). Guelph had a hefty financial stake in the GGR, most notably a $97,400 loan which Guelph dished out after the railway ran out of money. The project was then taken over by the Great Western Railway (GWR) who completed the railway through Hespeler, Preston and Galt (later merged as Cambridge) to Harrisburg where it connected with the Niagara-Windsor mainline. The GGR was followed by another GWR line, the Wellington, Grey & Bruce Railway, which was opened in stages between 1870 and 76, eventually terminating on the shores of Lake Huron in Kincardine. That line was not a money-maker largely due to poor construction which increased the operating costs.

Although Guelph's railway investments up until that point had not been financially lucrative, the community itself grew in leaps and bounds. By 1871, it boasted a population of almost 7,000. By 1879 it had attained city status. Rightly or wrongly, Guelph's business leaders attributed its rapid growth to the city's access to competing rail lines and expanding markets.

Guelph's status as a two railway town came crashing to a halt in 1882, when the GWR was absorbed by the GTR reducing Guelph to a single railway community. It didn't seem to matter that the newly combined GTR/GWR still covered exactly the same territory. The good citizens of Guelph were less than happy with the GTR which they considered domineering, remote, and unresponsive to community needs.

Casting their discouragement aside, Guelph's business leaders turned their gaze towards the newly created Canadian Pacific Railway (CPR) with its focus on Western Canada. This, they reasoned, offered a much larger and more promising future than the limitations of branch railways in Southern Ontario. It would also allow Guelph's industries get a jump start in the west. Their aim was to connect with the Credit Valley Railway which in 1883 was under construction by the Ontario & Quebec Railway Company, a future CPR property.

The Guelph Junction Railway (GJR) was federally chartered in 1884. The charter called for the road to run 15 miles (24 kilometres) to the south where it would connect with the CPR main line and then onwards to the city of Burlington. The CPR had already expressed interest in leasing the line.

Although the business leaders may have been all pumped up about having a second railway line, they weren't willing to back their enthusiasm with cold, harsh cash. Initial stock sales were slow leading to amendments in 1886 that reduced the stock requirements and allowed the city of Guelph to become a minority shareholder. Other early investors included J.B. Armstrong of Armstrong's Mills and George Sleeman, of Sleeman's Brewery fame. William Bell, founder of the Bell Organ Company, also an investor, was leader of the group and went on to serve as the railway's first president, holding that position until 1908. One major change, the ramifications of which were not wholly apparent at the time, was expansion of the charter allowing the GJR to build to the town of Goderich, a Great Lakes port, which in turn would provide access to shipping.

Construction began in November 1887 in accordance with the standards defined by the Railway Act and CPR engineers. That was one of the conditions in the CPR's leasehold. Upon completion and approval, the railway qualified for a federal subsidy of $46,000 towards construction costs. The total cost of construction was $222,148.04. Under the terms of the 99-year lease, the city would cover construction costs while the CPR was committed to pay 40 per cent on all receipts and offer twice daily passenger and freight service.

The first Guelph station was located on Priory Square in the very same house built by John Galt back in 1827. Other stations were opened in Arkell, Corwhin and Moffat. At the CPR's insistence, the line ended at Goldie's Mill even though James Goldie was one of the few business leaders who were satisfied with the GTR and indifferent to a second railway. The GJR began operating in September 1888. The hard work of promoting the railway and maintaining solvency was about to begin.

Despite the city's best efforts to boost the railway, Guelph's business leaders showed the same lackadaisical attitude towards supporting the railway as they had shown during the sale of stock. Possibly they thought that just having the GJR sitting in the wings was enough to keep the GTR on its toes. Businesses and farmers were inundated with flyers, letters, special service and rate offers to no avail. The reality was that despite everyone's ambivalence towards the unpopular GTR, that railway offered twice as much service and covered a far more extensive territory than the CPR, which was still the new kid on the block. Passenger service was an equally tough sell because passengers had to change trains at Guelph Junction resulting in a more inconvenient and longer trip.

The city had been persuaded to take on considerable debt to build the GJR. This included $18,000 in debentures to pay off debts and a $155,000 mortgage bond for 20 years at 5 per cent interest. That was a hefty financial burden for a small city in those days. Dreams and delusions of self grandeur coupled with an effective sales pitch from Guelph's businessmen did not pay the bills. Receipts were insufficient to cover the debts, leaving the city in a serious financial bind. Throughout the 1890s, Guelph had to cough up $8,000 a year just to cover interest payments.

The push to complete the Goderich extension was driven by financial necessity. Unless the CPR was able to reach more markets, Guelph's business community had little incentive to use it. With the GJR barely breaking even, the railway became even more persistent in urging (some would say hounding) the CPR to complete the extension to Goderich. Between 1890 and 1905, six requests were made to the CPR. Neighbouring communities that stood to benefit from the railway extension also got into the act.

Tired of the CPR's endless delaying tactics, the GJR switched gears in 1904. Under the terms of their charter, they formed the Guelph & Goderich Railway (GGR) in order to build to Goderich and include branches to Listowel, St. Mary's, Stratford and Clinton. The CPR got the message. Construction began in November 1904 with the line being leased to the CPR for 999 years. Most importantly, the GJR and GGR signed an agreement with the CPR not to divert traffic from Goderich thereby requiring all Goderich traffic use the GJR. The line was completed and opened at the end of 1907. It was followed by the Linwood - Listowel branch in 1908. The final piece was a link between the GJR and the city of Hamilton which would provide some serious competition for the GTR. That line, built by the CPR under the Southern Ontario Pacific charter, was opened in 1912. The original Guelph to Goderich line stretched for 80 miles (125 km). Once completed, the GJR totalled 105.4 miles with a further 16.4 miles (169.5 km) available to Hamilton on the CPR tracks.

In 1901, the city began making moves to get its own financial house in order. The 10 private shareholders were elected to the board of directors with the city taking on minority representation. That lasted until November 1910 when the city bought up the private shares in exchange for settling the mortgage bond thereby becoming the sole owner of the railway.

The Goderich extension was a financial turning point for the GJR. Between 1907 and 1913, the railway's earnings more than doubled. The agreement with the CPR not to divert traffic was particularly lucrative and resulted in a great deal of traffic passing over the GJR tracks. Another important source of revenue came from the grain trade and elevators in Goderich. Over the course of a few short years the GJR had changed from a financial sinkhole to a highly prosperous venture. To improve freight service, the GJR purchased weigh scales and submitted requests for improved loading facilities, a freight loading crane, and more warehouses. They also requested improvements in passenger service and a new station. In 1911, the CPR came through with a new station on Eramosa Road, built and owned by the CPR. The old station was relocated to Riverside Park and demolished in the 1920s.

Until the 1950s, there were very few changes to the GJR. Although passenger service was never a big draw, CPR made consistent improvements until the 1930s including a direct train to Toronto in the morning. The three small stations were serviced by a unique battery-electric shuttle car, known as "Old Sparky." It shuttled back and forth to the CPR mainline carrying shoppers and high school students to and from Guelph. Passenger service to Goderich ran on a mixed train. In 1938 the line between Listowel to Linwood was abandoned. This had a minimal effect on the GJR's earnings. That same year the railway appealed to the Minister of Public Works for improvements to the Goderich harbour and wharves. In 1935, the CPR tried to replace the self-propelled car to Puslinch with a bus and was turned down flat by the GJR directors. By the 1950s, passenger service had dropped to the point where this was no longer an issue. In 1958 the shuttle was reduced to two round trips daily. Two years later it was cancelled. Passenger service on the mixed train to Goderich ended in 1962. The connection to the Toronto-Windsor line lasted until 1961.

Freight traffic continued its slow decline throughout the 1970s and 80s. In December 1988, CPR obtained permission to abandon the line between Guelph and Goderich. That same year the GJR's 99-year lease with the CPR also expired. The GJR and CPR negotiated a new 10-year lease which was not particularly favourable to the GJR. The CPR had little interest in the line and in 1997 gave notice that it would not be renewing the lease. Undaunted the GJR signed a new contract with the Ontario Southland Railway (OSR) who officially took over on January 1, 1998.

Ontario Southland Railway is a rail contracting company that manages assorted rail services for a number of industrial manufacturers and producers in Southwest Ontario. The relationship between the GJR and Ontario Southland is both productive and prosperous. OSR has been energetically pursuing new customers, an area that had been languishing under the CPR for many years. Traffic growth has been steady and consistent, annualized at 17 per cent. Currently the GJR covers a distance of 24 miles (38.6 km) serving a dozen industrial clients, primarily in construction, agriculture and plastics. It connects with both CN and the CPR.

Despite its shaky beginnings, the Guelph Junction Railway has proven to be a positive and profitable venture. Still under municipal ownership, the railway is governed by a volunteer board of directors with support from a management team and the Guelph City Council. The railway remains unique in that it is the only federally chartered, municipally owned, short line, operating as a common carrier providing service to local industries. According to the most recent figures, the railway shows a net profit of about $200,000 a year which is reinvested back into the railway. With traffic steadily on the upswing, the future for the GJR looks extremely positive.