Motor service to La Mesa and Lakeside was discontinued in 1928. However, the development of Tijuana Hot Springs into the elaborate resort of Agua Caliente, the "Deauville of the Americas," including a new race track, resulted in the operation of two to six schedules to Agua Caliente with steam trains in addition from 1928 to the end of Prohibition in the United States.
  A series of disasters struck the road in 1932. First, a fire, possibly of incendiary origin, broke out in Tunnel 3 in Baja California in January. The portals were barricaded and sealed and the fire burned for four days. The roof caved in. The railroad was tied up for 45 days, causing a reported loss of $157,000.
  Scarcely had service been resumed when a huge mountain slide, loosened by heavy rains, blocked the line in the vicinity of Tunnel #15 on March 27th. After an engineering study had been made and plans prepared for a change in alignment, about one-half mile of new roadbed was constructed, including the building of a high wooden bridge on a 15 degree curve and tunnel changes. Freight and passenger services were re-established on July 6th and 7th and the cost ran up to $317,000.
  Finally, on October 22nd. Tunnel #7 burned and it was decided to abandon it. A by-pass was built around the cliff requiring seven 20 degree curves in 1,150 feet. Trains began running on January 23, 1933.
  By this time the heirs to the J. D. and A. B. Spreckels' estate had had enough and sold their interests to the Southern Pacific. As a result, the San Diego & Arizona Eastern Railway Company was incorporated effective February 1, 1933, as a wholly owned, separately operated subsidiary of the Southern Pacific. The motive power was re-lettered but the old numbers were retained.
  Floods hit again in 1939. The branch line along the San Diego River between Santee and Lakeside was badly washed, resulting in abandonment. In a few years the portion of this branch between El Cajon and Santee was also abandoned and the track was torn up.
  1940 saw the retirement of steam locomotives numbers second 2, 24 and 25, all being scrapped. Number 3 was returned to the Southern Pacific and became Harbor Belt #3, then Pacific Electric #1508. It was scrapped in 1947.
  Then came Pearl Harbor, December 7, 1941, and the United States was plunged into World War Two. The war emergency created an immense increase in traffic, in both the freight and the passenger departments. Many engines

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