The M&MR had continuous difficulty in raising capital and also in operating profitably but, thanks to a wealthy supporter, it opened from Pencader to Lampeter in 1866.

Although it was prime, Liverpool was not the only west coast port—it was rivalled by Bristol—but the thoughts of some business people turned to alternatives, and in 1845 the Manchester and Milford Haven Railway was proposed.

This would create a new deep water port on Milford Haven Waterway in south-west Wales, and build a railway line connecting to Manchester.

The scheme "failed to materialize and lay dormant for several years, during which time other companies had covered the intended route, except for the 51 miles [82 km] through central Wales from Llanidloes to Pencader.

The main physical obstacle was the great mass of the Cambrian Mountains just south of Plynlimon, separating West Wales from the Severn Valley; it was to be tunnelled as part of the 50-mile (80 km) section between Llanidloes and Pencader.

If the L&NR were to build the section of disputed route (as far south as Penpontbren), and make that part of its line available solely to the M&MR and the MWR, then the problem would be solved.

The Mid-Wales Railway too was building its line, and opened this part of it in September 1864, from which date it started using the "shared" route section and the joint station.

Meanwhile the M&MR set about building west from Penpontbren; it managed three miles (5 km) as far as the village of Llangurig, which was completed in 1864, construction then being halted.

West from the village there was to be a 1+3⁄8-mile-long (2.2 km) tunnel under Banc Merin (on which construction actually began) from Cae Gaer Roman fort to the Afon Merin valley; then another, and before reaching the coastal plain of West Wales it would have crossed a viaduct 280 feet (85 m) high over the Afon Ystwyth at Pont-rhyd-y-groes.

The intermediate terrain was thinly populated and had limited industrial activity, the objective being to connect Manchester and the port in southwest Wales as directly as possible.

[5][page needed] Now the route was to run along the east side of the River Teifi valley from Pencader via Llanybydder, Lampeter, Tregaron, Pontrhydfendigaid, Ysbyty Ystwyth and Pontrhydygroes to Devil's Bridge.

Now the question arose of reimbursement of cash put forward by the two principals in the interests of the company, and allegations of financial impropriety were laid.

The accounts for the period prior to this episode were clouded with controversy, but more pressing were two facts: that expenditure greatly exceeded income; and all the calls on the issued shares had been made.

Moreover the next section of construction was to be the most challenging in engineering terms, involving two tunnels together 1+1⁄2 miles (2.4 km), and an exceptionally large viaduct.

A more southerly alignment to get to Llangurig was proposed, forming a triangular junction with the authorised Aberystwyth branch where it intersected at Ystrad Meurig.

[5][page needed] The section of line from Llangurig to Penpontbren, about three miles (4.8 km), was completed in 1863, including track and signals, but was never opened as a railway.

[3][page needed] The entire route of 41 miles (66 km) was ready to be opened throughout, and this was done for passenger and goods trains on 12 August 1867.

Considering itself to be a trunk line, the M&MR publicity quoted connections from Liverpool and Manchester to Milford Haven via Aberystwyth.

These issues were only part of the financial problem that the line faced, having almost no conventional share capital other than that funded directly by John Barrow, and having taken out extremely large loans, on which unpaid interest was accruing at £8,000 a year over and above ordinary profit and loss.

The Manchester and Milford tried to claim against the Mid-Wales Railway, which, it contended, should have built the connecting line from Llangurig to Strata Florida, which would have enabled the M&MR to use the expensively acquired rights at Llanidloes, but the attempt was rejected in the House of Lords.

There followed a long period of unedifying board disagreements with the receiver, and improbable schemes that supposedly would resolve the company's financial ailments.

Income slightly improved in this time, and some work was done on relaying the track with recovered materials from the disused Llangurig spur line.

[5][page needed] The GWR spent £57,000 on bringing the M&MR line up to a workable standard in the initial years of the lease.

Unpaid debenture interest and loans amounted to £400,000 and the operating profit on the line did not leave enough surplus to pay current liabilities.

The merger was inevitable[note 4] and on 1 July 1911 the absorption of the company by the GWR took legal effect (by the Manchester and Milford Railway (Vesting) Act 1911 (1 & 2 Geo.

On summer Saturdays in the later 1950s and early 1960s through trains from Swansea or Carmarthen ran via the M&MR to Aberystwyth and thence along the coast line to Pwllheli.

For example the summer 1960 public timetable for the Western Region of British Railways shows this train running on high summer Saturdays only at 10.10 am from Swansea to Pwllheli, calling at Carmarthen, Pencader, Lampeter and Aberystwyth; it reversed at Aberystwyth and again at Dovey Junction and arrived at Penychain (for the holiday camp) at 4.56 pm and Pwllheli at 5.05 pm.

Attention was drawn to the social implications, in an area in need of commercial development, but the huge losses incurred by the line were dominant.

Green Grove on the Aberaeron branch continued to generate milk traffic until the end of September 1973, when the entire system closed.

At the summit (at Corporation Siding) the line fell steeply at up to 1 in 41 for 4+1⁄2 miles (7 km), and then more gently, with another, shorter steep descent at Llanrhystyd Road.