New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1912-11-18
President of American Company
Maintains Struggle for Sales
Is Free from Collision.
COST OF LEAF INCREASED
Ayers Securities Went Up Be-
cause in Dissolution All Men
Had Chance to Learn
Value of Properties.

stored IN the tODaCcO DuSlncSS through tHo
dissolution. of the old American Tobacco
/ Company. Mr.. Hill described In detail
trade conditions and the struggle for bust
ness between the several companies into
which the tobacco trust had been dis
solved, asserting that competition was
real, vigorous and lasting.
"A political campaign is ended in which
there was some discussion Of the effect OF
this decree, and such discussion as well as
other discussion has shown that there IS
very considerable misunderstanding OF
the situation" Mr.. Hill said. 1.-THE Amer
lean Tobacco Company. following rigldly
it's policy of n-participation in political
matters. has remained silent; but now
that the campaign is ended there can be
no reason urged against a frank state
ment Of conditions"
More Money for Producer.
One of the immediate effects OF the
dissolution. Mr.. Hill said, was the In
crease In the cost OF leaf tobacco, by
which tho producer Of tobacco was as
sured Of larger profit than he had re-
ceived before. Explaining this feature,
Mr.. Hill said:
So far az the experience OF the Amert-
can Tobacco Company goes, leaf tobacco,
generally speaking, has brought very high
prices since the disintegration IL Is ao-
solutely true that the decree has peen
obeyed In letter and In spirit, ana that
there has been competition vigorous ana
active II Is only fair 10 say that the
high prices have not, in our Judgment re-
suited solely from the d!sinteBratlon ana
the increased competition thus brought
about The fact is that In some or the
sections IN which leaf tobacco grows I'M
favorable weather conditions curtMled the
expected crop.
Undoubtedly different people connected
with the leaf departments OF the various
c0TnpaniCs have had different Views "a 20
the probable course OF prices. THIS condl-
ton has resulted temporarily and so t9r
I'm higher prices, although prices Woulh
have been higher even without TINS COM
pptitivs condition OF course. II the pres
ent high prices produce larger crops. as
they win under an unalterable economic
law. prices will fall by operation OF the
same law. When each competitor acuhs
independenty OF all other competitors, Sc
cI1ras his rs9uirements tho prices Will de-
cline iust as certainly as II tho purchasers
we're not In competition al all. Compeu,
ton has been actual, though, ana VII
continue. and up TO this time competitive
purchasing has been coinc!dent tl leaSt
with higher prices.
The position OF tobacco manufacturers
differed materially from that OF any
other large corporation. said Mr.. Hill
The success Of the tobacco manufactures
dercnded entirely upon the attitude OF the
public toward his product, he declared.
and every iobher and every retailer knew
the name OF the manufacturer Of every
tobacco product he handled. Every con-
sumner knows, or could learn by merely
looking al the package. tho maker OF
each tobacco product while the consumer
OF most necessarics Of life was generally
obllvious Of the name Of the manufact-
urer who produced the goods.
Consumer Has Wide Choice.
'Tf the consumer Is not pleased he can
Instantly change TO competitive brand
Mr.. Hin said. "Ho is the aroiter' the
court Of final appeal II his decision IS
against a manufactures, that manuiact-
urer will have to cease business
While other manufacturers were not
directly answerable 10 the public, MIR.
Hm added. the tobacco business was
upioue I'm that the manufacturer was al
wavs nj the mercy of the ultimate con-
sumer.
Price cutting as form OF competition
has hcen proved an undesirable weapon
bv the history OF the tobacco business
NJ Hn declared. All the products APP
mailing TO the sense OF taste or smell
were purchased invariably because or inc
articles specific appeal to the indiVidual
taste. MIR Hill said, and the only eHect
Of price cutting would be to suggest TO
tho consumer that the article had de-
Perforated In quality.
Persistent price cutting even by retail
ers OF various well known nye-cent ci-
gars had driven them into the three-cent
class. with the result that the hve-cent
smoker abandoned them and they died
Mr.. Hin said, adding:
Competition in the tobacco trade, there
fore takes the form OF vigorous adyer-
Using OF old brands, the energetic intro
duction of new brands and the deyisinS
OF Inducements TO consumers to buy their
old or new brands
Advertising Proof Of Competition.
Every newspaper or magazine reader is
Immersed with the tremendous amount
OF tobacco advertising In the daly, week
Nv and monthly press, evidence enough 10
Il tnOQBntiul lldH Ni't' 80 ,.......-
comuctition exists, or the manufacturers
wouid he saving the money which they
arc now pouring out I'm printer INK.
THE silk "Inserts" -fags and other deco
rotive desigus-are greatly desired by
women for use In pillow tops and other
fancy ueedlework They are expensive,
go that when a genius now connected
with the Lorillard company thought or
NE idea of packing them In clSarette
Loxes he found thing which made bust
ncss Thousands Of women urge their
husbands and sweethearts TO smoke GER
tain brands of cigarettes In order TO Sc
cure certain silk inserts
silk. inserts are so expensive that IN
the past they have never been packed
In cigarettes selling at less than 10 cents.
since the old members OF the American
Tob1cco Company began fighting among
themselves the silk insert has been
packed in scent cigarettes.
That this is a very grave item 10 charge
nm 10 competition is shown by the fact
that the cost OF silk inserts on only one
scent brand Of the American Tobacco
Company cigarettes amounts to 100000
Sny observer will find abundant evil
dence that the tobacco business in this
country to-day is a competitive business,
each manufacturer appealing 10 the con-
sumer. and. so far as the products OF the
American Tobacco Company and the
other companies that were carved out
of the combination are concerned, with
the consumer informed as to whose prod
uct he Is buying.
No secret restraint Of trade was pos
sfble. Mr.. Hill declared, because there
existed not only inJunctlons against the
companies into which the old American
Tobacco Company was dissolved to in