Dutch, I'm not sure if this agrees or disagrees with you, but I think that the earlier EMDs, as you said it, were "downgraded" mainly due to superior second generation power coming online. For instance, GP-7s and -9s might get knocked down a few rungs when the GP-20's or -35's came, which then got knocked down a peg themselves as the -2's came about. Factor in that now you aren't very likely to see four axle units slugging it out on tonnage freight instead of six axle units, and it becomes not just a factor of EMD vs. GE, but also of a change in philosophy.
I'll bet that those earliest units WERE beaten hard early in their life, and when the new power came, branch lines would be happy to take them. Were they beaten harder than the U-boats were? I don't know.
Don't forget that yesterday's shortlines and branch lines, which would have been happy with a 44-tonner, 70-tonner, or something similar, weren't around in the time of the 286,000lb car. The increase in car weights helps those first generation (now second, or third generation-what generation are we on now?) units have a natural place to go to work. It may give the appearance of longevity, when in fact, economics or physics comes into play as well. Are there places like this for older GE units? Sure....some get snatched up.
When the GEs came about, I think there was an abundance of EMD power already laying around that could work the secondary and tertiary lines, and crews that already knew how to maintain them. It wouldn't make sense to farm out some U23B's to the boonies if the shop wouldn't know what to do with them. A similar point comes from 241-engined ALCOs. Many people feel they are inferior to the 251 engines, so much so that there are ALCO roads that refuse to ever take one on. There's no question, though, that they can be good power when taken care of as appropriate. However, would you want to take on an engine that could be troublesome if you could have one of what you already knew?
Nowadays? I know that Gang Mills in NY has used a six axle GE as a switcher there, but I expect that's more out of necessity than desire. Will today's power last long enough to be used like that as often? I don't know. It seems financial angles (leases, locomotive financing) come into play here, which I don't know much about.
One last thing: it is possible that GEs are junk, but don't forget, they might not be throwaways as much as they were an example of a fledgling builder working through the growing pains. Does Alstom have issues with their New Jersey Transit units? If Brookville builds much larger units, larger than they built for Metro North (I thought I saw they signed a contract somewhere to do something bigger), will they run into the same issues?
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