Unlike his competitors, John Roach had been able to maintain his profits in the postwar period by diversifying his plant into the manufacture of machine tools and selling them to the U.S. Navy, which was in the process of upgrading its shipyards. By contrast, the Morgan Iron Works, like most other New York engine builders, had struggled in the postwar period, building only two engines in the two years following the war. It remained in business only because Morgan could afford to weather the losses, but in 1866 he suffered an additional financial setback when his newly established shipping lines to Mexico were aborted due to the overthrow of Maximilian I of Mexico.