The Indianapolis journal., 1899-02-15
A POSSIBLE COMBINATION
ASSERTED THAT A CAR-BUILDING
TRUST Is TO BE FORMED SOON.
Indiana Car and Foundry Company
and the TeFre Haute Con-
Germ Mentioned.

For some time there has been talk Of a
combination Of the companies manufactur-
ing freight cars into trust the main pur-
pose of which should be the increase of the
price Of cars. In this country there are
about thirty large concerns representing a
capital of $10OG00.000 engaged in the manu-
facture of freight cars. Of which about 15o,
coo are turned out each year. 1t IS said that
the ordinary wear and tear on freight cars,
not considering any extension of equipment
calls for 10000 cars a year. The last few
days there has been revival of talk concern
ing the formation Of a trust and it has been
freely asserted that a meeting was to be
held here for the purpose Of initiatory steps
along this line. Connected with the stories
have been the names of the Indiana Car
and Foundry Company, Of this city, and the
Terre Haute Car Manufacturing Company,
of Terre Haute. The understanding is that
Mr. Cox, of the Terre Haute company, has
said that unless the Indianapolis company
came into the combine his would not Major
Collins, of Brazil, president of the Indiana
Car and Foundry Company, is also presi
dent of the Central Iron and Steel Company.
He is now in New York working to bring
about a combination of the steel and iron
rolling-mlls. II. +. Frazier, treasurer of
the Indiana Car and Foundry Company,
says that the local concern has recently re-
ceived no information concerning the
movement to organize a trust. He says,
however. that such a movement would
probably be first presented to Major Collins.
Mr.. Frazier said that if any meeting is to be
held here in the near future he has no infor-
nation concerning it.
Seven or eight of the largest car building
companies have been interested in the for
nation of a trust for the last two or three
years. According to statements given out
there has been no profit in car-buildng
since the panic of 1S92-1S93. In the latter
year the railroads ceased taking cars. it is
asserted, except at actual cost and the
manufacturing companies We're compelled
70 reduce prices to a figure that hardly
made them living, to say nothing about a
profit. The Terre Haute company, for in
stance, 1T is claimed, has a daily output or
eighteen to twenty cars at 5000 to 500 each,
or daily income of about $1,000. Cars have
IN the past been sold on a sort OF condl-
tional lease system. The purchasing COM
panies have generally paid 20 per cent. cash
and agreed to pay monthly payments run
ming over eight years on C4rS purchased IN
Guiding interest at per cent ADDED 10 the
investment The selling companies reserved
the right to take back the cars when there
was any default IL pa yment. Recently the
payments have been reduced so that cars
must De pdlQ IOr IN lull SFOHl llNe ~ 0lN
years. The average life of car is about
ten years, so that on the new basis, the
company has the use of the car Tor TOUR
years without charge the estimate being
that the car will pay for itself in the time
within which the company must pay Tor IL.
The Indiana Car and Foundry Company
now has capacity of producing ABOUT NJ
teen cars a day and it is intended TO in
crease this to twenty within short time
Among the concerns reported to be in
terested in the formation of a combination
in this CitV in the next few days are the fol-
lowing Missouri Car and Foundry Com
pany, St. Louis; Terre Haute Car Manu-
featuring Company Ohio Falls Car Mahu- Many
gan Peninsular Car Manufacturing COM
pany, Detroit; Barney & Smith, Dayton;
Wells & French, Chicago; Haskell q Baker,
Michigan City, and Indiana Car and Foun-
dry Company, Indianapolis. These are
among the strongest institutions in the
country. The Pullman Company IS not IN,
cluded, as the Pullman interests include
both freight and palace cars and 1t would
be difficult to separate them IN comblna-
tion 1t is said, although they are now sep
arated In fact.
A gentleman who is we'll informed in rail-
way matters says the new car works COM
pany will be called the American
have a capital of SEQ, ,O00000 of which
one-half will be preferred and one-half COM
mon stock. Fifteen millions of each are
offered for subscription. 1t will take S2,0OJ:-
600 per annum to pay the 7-per-cent. divi-
dend on the preferred stock, and per cent.
on the common will take 100000 more, or
total of 50. COO 600. The average demand for
freight cars is about $4,000 a year; in un-
usually prosperous years 1t may reach lVO,-
900. 1t is thought that with the number
of outside car-building companies II the
consolidated company gets $4,000 cars 1t will
be doing well, as it has only from one-half
to three-fifths of the contract shop capacity,
and a large number of steel cars will be
built besides which the railroad shops turn
out quite q respectable proportion or the
total number built.