Pacific Greyhound Lines, one of the two most successful of the Greyhound subsidiaries, arose out of a competitive environment of small entrepreneurs to monopolize most intercity bus markets within California. During the hard times of the 1930s it earned a substantial 30% return on its investment. Its success derived not from conspiracy between Southern Pacific Company and General Motors Corporation to loot lucrative rail markets, as is commonly believed, but by corporate planning that stressed cost control and economies of scope. Because of such economies, achieved through planning, it contributed more to public welfare than small, competitive bus entrepreneurs of the type favored by adherents of deregulation.
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