In the mid-1950s VGN management realized that the company's devotion to coal as its energy source (for steam locomotives and the power plant at Narrows for the electrification system) was becoming overshadowed by the economies of diesel-electric locomotives and a scarcity of parts for the older steam locomotives. Between 1954 and 1957 a total of 66 diesel-electric locomotives were purchased, including 25 Fairbanks-Morse H-24-66 Train Masters, and 40 H-16-44 smaller road switchers, two with steam generators to haul passenger trains. The last steam locomotive operated in June, 1957.