Harrisburg telegraph. [volume] (Harrisburg, Pa.) 1879-1948, 1916-03-04
REASON FOR THE
RISE IN PRICES
Backs Up Prediction That Mo-
tor Car Announcements Will
Show Increase in Price

of the REQ Motor Car Company.
Mr.. Rueschaw, who is the oldest
sales manager in the automobile in
dustry, has acquired the reputation as
Il prophet because of the accuracy of
predictions he has made from year to
year as result of his long association
with the industry and his intimate
knowledge of the inside affairs there
of. His statement quoted about will,
therefore, be given more than usual
credence by men in and outside of the
automobile industry.
There are many reasons why few.
! If any automobile concerns will an
nounce new models at the usual time
next July. and there are quite as many
reasons why prices will have TO be
tilted" continued Mr.. Rueschaw.
First, is the increased cost of ma
terials because of the shortage of
many kinds that are absolutely essen
tial to the making of an automobile.
OF course this shortage is due to the
Eoropean demand and the unprece-
dented prices munitions makers are
willing to pay to obtain quick deliver
les.
Just consider the following for
which George Il. Smith, manager oe
he purchasing department of the
REQ Motor Car company, is authority:
Metals of all kinds have at least
doubled in value in the past six
liOHtISt ana III SOME INSTANCES. lllG
advances have been much greater
this applying particularly to tool
sLeels High speed steels have in
creased in price from 45c per pound
to So and over, and this figure is
nominal one. high speed steel being
almost unobtainable; this has affected
he cost of tools made from such
steels. to an even greater extent than
represented by the advance in the
cost of steels, due to large increases in
labor costs.
"IIish speed drills, which we form
crly purchased at 65 pc" cent. discount
from list. are now printed at list plus
15 per cent, up to y Inch diameters:
above this diameter. they are list plus
80 per cent. up to 1-inch. above which
size the price is double the list
Cutters. rcamers and small tools
4re now sold on the same basis. and
are extremely difficult to secure. We
hre compelled to buy in small lots
from different manufacturers and job
bers wherever we can find a small
supply.
Bar steels, used for making parts
of cars, have more than doubled in
price, and prices are advancing rapid
y, and the scarcity is increasing even
more rapidly. Orders placed with the
mills in December last, are scheduled
for delivery in January, 1917.
Ordinary cold rolled bars cannot
he secured from mills in less than six
months. Steel tubing required one
wear for delivery on mill specifica-
ions, and this item is also unobtain
able from jobbers' stocks.
"Odd lots of bar steel and forging
steel can still be secured from jobbers
md mills in small quantities, and in
order to maintain our supply, we are
AOmpelled to purchase wherever ma
rial can be found. For example:
I'VE have just completed a run of
10000 siX-cylinder crank shaft forg-
ngs made from steel that was pur-
hased while in transit. to another
customer, this purchase having been
made by paying stiff premium for
he steel. For our next lot of 1900 of
hese cranks, we have just succeeded
n placing an order for steel with
small mill in Cumberland, Md, which
hey promised to ship Immediately,
he cost being just double the mill
price on contracts for this period, and
nearly three times the cost of this
steel in normal times. This condi-
ion applies to all kinds of steel pro-
iucts.
"Other metals are in the same
shape. The price of copper at the
present time being 27c against 13c
before the advance began. This also
) practically unobtainable, except by
purchasing at least six months in ad-
ance of our requirements. This af
ects all brass good, such as casting
sheets. tubes, rods, etc.
The aluminium situation is the
same, the metal for immediate dcliv-
ny being unobtainable, and the price
1t least three times above normal.
Zinc, which is largely used in the
manufacture of war material. is sell
ng at 20c per pound, against &c to
&c in normal times.
a1
pound to 81 per pound, but has since
receded to about soc. The supply is
absolutely uncertain and unreliable
owing to lack of ocean transportation
facilities.
Leather remains extremely scarce.
md difficult to secure in satisfactory
luality, the price being correspond
ngly high, costing ut least one-third
more than in the preceding season.
with the possible exception of
paints, there is not a single item used
II our factory that has not advanced
rom 10 per cent. to 800 per cent. in
ost.
I'VE REQ folks are fortunate if
ou want to put it that way, in having
practically everything that we will
need for our factory run up to the
lose of our fiscal year, already on the
ioor, and we are comfortably covered
or most everything for year beyond
hat
in these times we never feel sure
,f anything unless it is in our own
Warehouse, and Mr.. Smith was suffi-
iently foresighted to procure his re-
uirements some months ago and to
,btain deliveries before most men in
lis position realized that there was to
pc a shortage.
"Of course REQ ready cash was q
pig father in that operation, as it is
low, for we are frequently able to
Dick up lots of materials that are des-
ined for others who are less certain
o pay or who are unable to pay cash
pm the nail.
Another reason on which [ base
ny assertion that next July's an
houncements will not be of new mod
Is but of new prices. and that the
,rices will be higher is the railway
ar shortage that obtains at the pres
mt moment. No manufacturer is
bic to ship cars as fast as he can
'rQduce them, and that is going to re-
ait in the slowing down of a number
+ factories and the consequent exten-
ion of the date on which the present
actory runs can be completed. In
ther words. many factories that have
damned to complete the present run
y July 1 will probably have to ex-
end the time over into next autumn
hat also will affect the price.
AT first blush that last statement
nay seem illogical. but a moments
hought will show the force of it