There were lots of factors, but the short story is that GE, who was once a partner in Alco's diesel building, turned competitor when they came out with their own line of road diesels, starting with the U25B in 1960.
Alco just couldnt compete, EMD and GE made better products during the 1960's, Alcos had more maintance issues that EMD and GE locos of the time, and the railroads chose to buy the more reliable product..
Alco didnt "choose" to go out of buisness..they didnt have a choice. they closed shop in 1969.
The "last-gasp" of Alco, the Century series, were good engines! and as you said, many short lines are still running them today..they were good, just not "good enough"..Alco became the number three builder during the 60's, and the market couldnt support, and didnt need, three builders.
Scot
