Forest City press. (Forest City, Potter County, D.T. [S.D.]) 1883-19??, 1917-02-02
TO BUILD SHIPS
AT COST PRICE
Bethlehem Steel viii Make Of
fer 10 Uncle Sam.
eIDs on IS INCH NAVY SHELLS

GIDS Ua ID INCH NAVY SHElLS
No Chance For Profit In Them Under
Present Tests. Grace says-Possible
Explanation of the Prices Made by an
English 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 a peculiar sense Bethlehem Steel
serves the American people.
For example,, though we have been
able to obtain in Europe almost any
price. we have adhered, in U charges
to the United States Government, to
the basis of prices established before
the war began.
We agreed-if the Government would
abandon its plans for a Federal plant
to make armor for our Navy at any
price the Government Itself might con
elder fair.
Our. ordnance plants are at the dis
posal Of the nation at a fair operating
cost, plus a small margin, thus saving
the Government investment and de-
probation.
One of the special needs of the new
navy is s~ixteen-inch ~guns-guns sixty
feet long and capable of HURTING a
1000 pound she'll with such power and
accuracy as to hit a so foot square tar
get fifteen miles away.
We have undertaken voluntarily to
construct. at a. cost of S4,5C0,o00. a
plant fitted to build s%ixteen-inch guns.
Under no conceivable circumstances
can orders which we may receive for
this plant pay even a fair return Cd
the investment.
/. Considerable comment has been made
upon the fact that a British manufac-
turer recently bid less than American
manufacturers for sixteen and four.
teen-inch shells for the navy.
l am unable to state the basis upon
which the English bid was made. 1t
should be remembered, however. that
this bid was for a specific shell, sam
pies of which are heing sent over for
tesla test not yet made.
Two years ago we took an order for
| 240O fourteen-inch armor-piercing shells
at a contract price OF $76S,0O0, to be
delivered within a certain time or we
had to pay Il large penalty.
The only specifications for making
these shells are that they shall he
OF a certain size and must pierce
armor-plate at a certain velocity on i'm.
pact. 1t is impossible to foretell the
exact conditions of the tests.
We had made large quantities Of shells
in the past which had been accepted.
But in placing this particular order the
| Department altered the angle at which
! the tested shells must pierce armor-
plate. The result, however, has been
absolute inability on u part to pro-
duce in any quantity. shells which will
meet these novel tests. In fact. we
know Of no process Of projectile-mak-
ing through which 1t is possible to pro-
duce in quantities shells which will
conform to the requirements.
The result is that up to now on that
contract Of S76S.OOO. we have put into
actual operating expense SAT- ISL. and
have been penalized for non-delivery
S495, ia, a total Of $943. 625., with no
receipts whatever.
Such was the experience in the light
Of which we were called upon recent
II to bid for s~ixteen-inch shells.
We bid on these shells at approx
mately the same rate per pound as
that OF a fourteen-inch shell contract
of one year ago upon which the Gov.
eminent awarded contracts.
we hare not the slightest Idea what
profit there will be in the making Of
these shells. We do not know that
there. will be any. There Is no certain.
ty that 1t would be possible for us to
deliver a shellsto meet the test.
4 For officers In the Navy to assume
that any bid made. under such condi.
lions Is "exorhitant' Is utterly unfair.
We bid on the new battfs-cruisers
sums which Navy department experts.
after examination Of u books. found
would yield I profit OF less than ten
Ter cent. We aereed to assume risks
for increased costs Of materials md la
boz. that. made Il possible that these
contracts might yield no profit what
ever.
The costs run beyond the q a..