Post–war challenges
In the post-war years the DAR moved to replace its steam locomotives with diesel-powered models. However the railway was relatively late among its North American counterparts in doing so (possibly owing to abundant coal being mined in Nova Scotia). The railway experimented with two diesel-electric ALCO S-3 switchers for several months, which were placed in service on July 1, 1956. Steam locomotives were not displaced until the arrival of ten EMD SW1200RS road switchers in April 1959. The SW1200RSes replaced the S-3s, and all but one steam locomotive, which was retained for a short time, a switcher used in service between Kentville and local communities until 1961. The railway also saw CPR introduce two Budd Company Rail Diesel Cars (RDC) in August 1956 to reduce operating costs of its passenger services which had previously been conventional trains hauled by steam locomotives. The new diesel passenger service was called The Evangeline, although it was widely known in the Annapolis Valley as "The Dayliner".
The S-3 diesel locomotives and the original two RDCs were lettered Dominion Atlantic, which makes them unique as the only diesel era equipment lettered for a Canadian Pacific subsidiary line. However, later locomotives and subsequent RDCs were lettered Canadian Pacific. The road name Dominion Atlantic gradually faded throughout the rest of the railway's existence although the name remained on maintenance of way vehicles, some passenger timetables, tickets, stationary, as well as a few stations.[13]
Declining passenger business and the collapse of the Annapolis Valley's apple industry led to reduction in service. The DAR's steamship services on Minas Basin and the Gulf of Maine were abandoned, although the company maintained the passenger/auto ferry connection between Digby and Saint John. With passenger service falling, the DAR sold its hotel chain as well as the Grand Pré Park in 1957. A larger new ferry terminal was built with federal assistance at Digby Gut in 1971 but its location away from the DAR's track and station in Digby ended the ferry - rail connection.[14]
By the 1970s, the DAR was starting to see its operations west of Kentville reduced to branch line status. The Cornwallis Valley Railway branch lines north of Kentville to Kingsport and Weston were abandoned on January 31, 1961, for lack of passenger traffic and the postwar collapse of the apple industry and reduced to a three-mile spur line to Steam Mill Village. CPR began reducing its passenger service to minimal levels between Halifax-Yarmouth and Windsor-Truro upon construction of the parallel taxpayer-funded all-weather Highway 101 between Halifax and Kentville after 1970. In a 1969 agreement with the provincial and federal governments, CPR built a new passenger/auto ferry for service between Saint John and Digby, while the governments built new ferry terminals and connecting highways. Both of the new ferry terminals were built away from the railway lines, so that neither permitted rail-side transfers at the dock from passenger train to ferry, causing the Dayliner or RDC service to suffer further declines in passenger numbers.[15]
The only bright spot for DAR was in gypsum traffic, a mineral that was quarried just east of Windsor and hauled to expanded port facilities at Hantsport; it was in high demand throughout the post-war years during the North American housing construction boom. Prior to Hantsport's expansion, gypsum had also been hauled farther west to the Annapolis Basin at Deep Brook, however shipping operations were consolidated at Hantsport in the post-war years.
In 1978, financial responsibility for the Halifax-Yarmouth passenger services was transferred to the federally owned Crown corporation Via Rail from the DAR/CPR. The Windsor-Truro mixed train passenger service on the Midland, which had survived as the last mixed train on the CPR and one of the last mixed trains in North America, was abandoned in 1979 after being deemed non-essential, reducing the Truro branch line to light freight status.[16] Passenger service on the DAR began to rise, particularly after a 1983 schedule change which provided a daily return trip to Halifax from all points on the line, as well as improved connections to other Via trains at Halifax. Via also introduced refurbished Budd RDCs, and began a modest promotional campaign which included reviving the name Evangeline, drawing on Acadian history, a longtime focus of DAR travel. By 1984, Via reported that traffic in its Halifax-Yarmouth service had quadrupled to an average of more than 100 passengers per trip, eclipsing most of the decline experienced in previous decades. The Evangeline would continue operating until January 15, 1990, following a massive cut in funding to Via's branch line services ordered in the 1989 federal budget by Prime Minister Brian Mulroney's government. Abandonment proceedings for the Kentville to Yarmouth portion of the line were commenced by CP with in three months of the VIA cuts.
