Evening star., 1927-05-05
EXPECT GRAHAMS
. TO SPUR PAIGE CO.
huto Trade Sees New Capital
in Firm Forecast of Stern
er Competition.
BY j. C. ROYLE.
necjal pisnatch to The Star.

Special DISPATCH to The star.
3 NEW YORK. May 5.-Acquisition
OF the controlling interest in the
Paige-Detroit Motor Car Co by the
three Graham brothers. Joseph b.
Robert G. and Ray A, marks the
first skirmish in the fight to transfer
some sections of the motor industry
into stronger hands. The arrange
nents bring back into the business
4 trio who have had wide experience
and have made successes of two other
motor corporations. The basic I'M
pulse behind the move is the terrific
competition which now exists in the
industry.
The confidence which Detroit has
in the acumen and initiative OF the
Grahams was shown clearly by the
active buying of Paige-Detroit stock
at prices $5 to Sc a share above the
low point of the year. The impression
exists among autOmotive engineers
that the Grahams viii make the books
Of the new acquisition tell n different
story for the remainder of the year.
The Paige Co. has reported deficit
for the first quarter amounting to
StS5.797. as compared with a profit
df S505, ,369 in the corresponding period
of 1925. The Grahams hope to bring
the balance back to the right side
Of the ledger.
Will Use Si,OOO,O00.
To do So they are bringing $1,000
900 into the concern for immediate
use. They also plan to issue $4,000
900 in cumulative voting, convertible
second preferred stock in order to
provide for expansion and develop
ment. The Paige Co. occupies a
6E-1rFQ
site in Detroit in which lines of
medium priced eight and six cylinder
cars are produced. Prior to this year
0f bitter competition, Paige-Detroit
has been one of Detroit's most sue
cessful independent producers, and in
addition to large cash disbursements
has paid stock dividends totaling 426
per cent.
The trend in the industry, however,
has been toward increased output and
earnings for strongly financed corpor-
ations and a falling off in earnings by
others. There is every reason to be-
lieve, for example, that April earn
ings of General Motors have exceeded
the wonderful record made in March.
Nay and June are not expected to
show so well, since the latter month
will be devoted to some extent to ef-
HDIlS 10 get Out new INbu5lS, NHiCIL
always are shown shortly after mid
year. Compared with 1926, automo-
lille engineers anticipate that the
profits of the leading interest will
show a gain of 25 per cent, as COM
Jared with 1926.
Chevrolet. of the General Motors
string, has shown the largest gain and
will make 100000 cars this year,
compared with 100000 in 1926, if
present schedules are maintained.
Cadillac, Buick and Chevrolet all are
behind in deliveries and the La Sale
5 being turned out at the rate of
$500 month.
The Ford Co, it is reported from
Detroit, is experiencing a surprising
evival in demand and is putting many
TorkerS back on the job. Hudson
Essex is turning out six-cylinder
models faster than such cars ever
ave been built before. Dodge Bros.
eount on sales of the new models to
o.fset the slack business of the early
1onths. Three companies show gains
ID net earnings for the first quarter
= 8 compared with year ago and
even show losses. OF the same group
we equaled 1926 production rates and
i've curtailed.
Minimize Flood Effect.
Motor executives show a tendency
10 minimize the effect of the Missis-
ippi floods on the industry.
With the Graham deal only await
Jag formal ratification by the stock
holders, the next sensation in motor