Wells Fargo expands across the west

After the panic of 1855 the road to expansion in California was wide open for Wells Fargo. Their main rival, Adams and Company, had collapsed and so had a number of smaller operations. Wells Fargo lost money but remained solvent. The number of express packages arriving in their San Francisco office was twice that of the two leading competitors combined. They had branches in 55 towns across California and with more to come. Between 1856 and 1860 their listed assets doubled, as did the number of towns with a Wells Fargo Express office. The company ran so efficiently that no true competitor existed anywhere in the state at the end of the decade.

American Progress, John Gast

In 1855 Louis McLane, a banking and transportation expert, was made general manager of all California operations. In 1860 he bought the Pioneer Stage Line that ran from Sacramento over the Sierra along the Johnson cutoff to Nevada’s Carson Valley. Then in 1864 he officially sold Pioneer to Wells Fargo. During this period Wells Fargo also invested heavily in the Butterfield Stage Line and Ben Holladay’s Overland Stage Company but had remained out of the staging business, although many suspect Pioneer Stage had been a Wells Fargo operation all along. But when the Butterfield line and the Pony Express failed they had taken over their assets. After the Civil War ended and Wells Fargo bought the Overland Stage from Holladay they became the largest stage company in the world, running coaches regularly from the Mississippi River to California. A sad testament of their reach across the west is that in the 1860s alone over 300 Wells Fargo stages were held up and over $400,000 stolen.

Indians attacking a stagecoach

Then, in 1868, Lloyd Tevis and a group of investors that included Leland Stanford, Charles Crocker and Mark Hopkins formed the Pacific Union Express Company and they held a 10-year contract for exclusive use of both the Central and Union Pacific Railroads. Wells Fargo stock fell dramatically and the Tevis group bought that stock at wholesale prices. In 1869 Wells Fargo agreed to buy Pacific Union Express but in return had to give control to Tevis, but now the company had the rail contract. The first train robbery dutifully followed in 1870 near Truckee, California. Yet by the end of the 1800s the company had over 3000 offices and was in every state in the country. But with the coming of trains the stagecoaches slowly faded away. The last stage was robbed in 1908 and the last coach with Wells Fargo cargo went from Tonopah to Manhattan, Nevada in 1909. Then in 1918 Wells Fargo’s express business merged into the American Express Railroad Company, leaving only the Wells Fargo Bank that we still know today.

The Governor Stanford

 

Comments

  1. How did the Overland Stage Co. run by Ben Holladay fit in here, John? Did it go head-to-head with Wells Fargo, or did Holladay sell out to them?

    Interesting series of posts. Surprising to me how parallel California history and Montana history are in some respects.

    Carol

    • Holladay sold the stage line to Wells Fargo for one and a half million dollars – http://mygoldrushtales.com/2011/06/14/the-stagecoach-king-ben-holladay/. Wells Fargo already had the Pioneer Line, from Sacramento across the Sierra and into the Comstock Territory in Nevada. They had invested in the Pony Express and were big backers of the Butterfield Stages that ran across the southwest but failed because of the Civil War. Holladay’s line put them in the drivers seat. It was the government mail contract that was the prize.

      Yeah, it does seem like a lot of parallels existed between California and Montana, but both places were settled by gold miners. They tended to be independent, tough, do-it-yourself people. It looks like they faced a lot of similar problems and came up the same solutions. I think it’s fascinating to compare your story with mine.

  2. Great Post! I enjoy reading, and agree with most of it.

Speak Your Mind

*