The record. (Greenville, Ky.) 1899-1???, 1917-08-30
TO BUILD SHIPS
At COST PRICE
Bethlehem Steel VIII Make o.
fer to Uncle Sam.
BIDSOa IS INCH NAVY SHELLS

No CHARGE For Profit In Them Under
Present Tests. Grace Says-Possible
Explanation of the Prices Made by an
Enqiish Firm Which Bids Under All
American Manufacturers.
Speaking recently before the Terra
pin Club OF Philadelphia. Eugene q.
Grace, President Of the bethlehem
Steel Company, said in part:
In peculiar sense Bethlehem Steel
serves the American people.
Fo: e~ample, though we have been
able TO obtain in Europe almost any |
price. we have adhered, in our charges
to the United States Government, TO
the basis of prices established before
the war began.
We arreed-if the Government would
abandon its plans for Federal plant
to make armOr for our Navy at am
price the Government itself might con-
slider fair.
Our ordnance plants are at the us
poSal OF the nation at fair operating
cost, plus small margin, thus saving
the Government investment and de-
probation.
One of the special needs Of the new
navy is siXtccn-inch guns-guns Sixty
feet long and capable Of hurting
1000 pound shell with such power ana
accuracy as to hit 80 foot square TAR
get fifteen miles away.
We have undertaken voluntarily 10
construct, at q cost Of S4oOO0OO, a
nIant fitted to build Sixteen-inch guns.
Under no conceivable circumstances
can orders which We may receive 1or
this plant pay even fair return on
the investment.
Considerable comment has been made
mon the fact that British manufac-
turer recently bid less than American
manufacturers for sixteen and four
teen-inch shells for the navy.
am unable to state the basis upon
which the English bid was made. IL
shouId be remembered, however, that
this bid was for a specific shell, sam
ples of which are being sent over for
tesla test not yet made.
Two years ago we tooh Ill oi'ei w
24OO fourteen-inch armOr-pierclng shells
at q contract price of $I6S, 900, to be
delivered within a certain time or we
had to pay large penalty.
The ONLY specifications for making
these shells are that they shall DC
af a certain size and must pierce
armor-plate at certain velocity on lm
Daot. 1t is impossible to foretell TIT
''' exact c6ndfrioffs OF stss::-
we had made large quantities of she'll
fr rho mast which had been accepted
But in ,,tacing this particular order tn
Department altered the angle at whicl
the tested shells must pierce arlnoi
Mate. The result, however, has bee
absolute inability on our part to Pre-
duce in any quantity, shells which WI
moot these novel tests. In TACT, W
know of no process of projectllc- mas
ing through which it IS possible to pro
fuce In quantities siciis Whlch WI
conform to the requirements
y5,n result is that up to now on tina
contract of $7GS, OO0. we have put INT
octuaI o,serating expense SAT ,SSl., al
have been penaiized for non-deliver
e4e5 IA. a total OF s943, G2o., with
receipts whatever,
91rcli was the experience In the fst
of which we were called upon receh
" TO bid for stxteen-inch shells.
We bid on these shells at approx
natnlv the same rate per pound
that Of 4 fourteen-inch shell contra
of one year ago upon which the 10
eminent awarded contracts
We have not the slightest idea VIII
nroft there will be in the making
those shells. We do not know tn
there will he any There is no certai
tv that it would be possible for us
deIiver a shell to meet the test.
gIor officers in the Navy to asSuf
that aug bid made under such COM
ttons Is ''exorbitant'' is utterly unlai
We bid on the new battle-crulse
srroa which Navy department exper
after examination Of our books. fou
would Weld profit of less than
mar cont. We agreed to assume ris
for increased costs Of materials and
nor that made 1t possible that TIT
contracts might yield no pFoAt WI
ever.
The costs run beyond the amount
propriated Icy Congress on the basis
the cost estimates made year ago
And because shipbuiiders could
o1tar the incxorabic cost facts and
suce bids to early estimates or
Navy Department, the prices are ca
%exor1oatant."
It would be real advantage to
relieved of this naval construction
nrofif from it cannot possibly amc
TO much, and the responsibility Is G
NOUS.
We have determined to make
offer to the American Government.
eff YOU will build two OF the ba
,r,,fsers in Government navy va
we will build the other two at the
contained cost of building the ship
the Government yards, without &
.ional expense or commissions OF
kind. We will also contract to
l,,,r ships ready for service ahea
the Government ships"
Er1.-ss .sss.--
$500; SS3 ar n az. AZ "a vi tsiS