VIA RAIL CANADA, INC.

Canadian state-owned passenger-railway system. Incorporated in 1977 and established in 1978 as a crown corporation independent of the Canadian National Railway Company and Canadian Pacific Ltd., VIA has gradually assumed full responsibility for managing all the country's rail-passenger services except commuter lines and some small local lines. Headquarters are in Montreal. After World War II, Canadian rail-passenger service fell off owing to competition from airplanes and automobiles, and much stock became outdated, with service becoming inefficient and costly. VIA was formed in the hope that it would permit economies not possible when the CN and CP railroads ran independent passenger services and would thus reduce the amount of government subsidies needed to support Canada's rail-passenger system. It acquired ownership of all CN and CP passenger locomotives but does not own any track. The government compensates the railroads for the cost of operating VIA trains over their tracks. Since VIA's inception, the government has ordered significant reductions in its routes and frequency of service, most dramatically in 1990, when its operations were cut by about half.