Evening star., 1934-10-07
Detroit Basing Point Asked
to Gain Equality With
Other Buyers.
PREFERENTIALS AT END
UNDER CODE PROVISION
Other Makers May Follow Ford in
Building Mills Unless Steel
Firms Relent.
BY EDWARD w. MORRISON.
Special Dispatch to The Star.

BY EDWARD w. MORRISON.
Special Dispatch to The Star.
DETROIT, October Ga deter
mined campaign by automobile manu-
facturetrs to bring down Detroit steel
prices may be reflected eventually in
lower car prices.
The request of the National Auto
mobile Chamber of Commerce for the
establishment of Detroit as basing
point on steel prices is interpreted as
an attempt to put pressure on the Iron
and Steel Institute to place steel buy
ers in the automobile industry on the
same footing as buyers in Pittsburgh,
Cleveland and Chicago, where base
prices exist.
A bitter battle has been waged be-
tween automobile manufacturers and
steel manufacturers ever since the
steel code was adopted. Before the
days of N. r. A. automotive users of
steel were granted preferential prices
because they bought heavy tonnage
annually. Under the code, however,
no consumer is entitled to reduced
prices.
Large Buyers Protest.
After vigorous protests by the Gen.
eral Motors Corp. and other large
buyers provision was made in the ad-
ministration of the code for special
delivered prices in Southern Michigan
on steel going into motor cars. The
major automobile companies tempo
rarily were pacifled. They did not
relent. nevertheless, in their plans to
demand Detroit base price.
When a point for base prices is
established a schedule of figures is
adopted to operate on sales. regard
less of prices elsewhere The largest
steel companies have frowned on the
establishment of Detroit as a basing
point. They do not possess mills in
the Detroit district.
Accordingly they would have to alb
sorb freight charges which they now
pass along to the consumer. The
prices they would Be compelled to
quote would be founded on a nom
existent Detroit output.
However, unless some further con-
cessions are obtained on steel prices,
other manufacturers may do as the
Ford Motor Co.-build their own
mills. The recent expansion plans of
the Fort steel units are seen here as
one of the developments in the fight
against the steel manufacturers.
Smaller Companies Busy.
Ford blue prints call for a new
strip mill to make hot-rolled and cold
rolled heets. rounding out the steel
finishing mills at the Ford River Rouge
plant. When the new mill is COM
plete> Ford will be able to turn out
mos Of the company's steel require
ments, which average 10000 tons of
heavy steel and 10000 tons of fiat
rolled steel a month.
The independent steel makers who
are invading the Detroit district are
supporting the demands of the auto
mobile manufacturers, of course. They
see chance to force the hand of the
big companies on the lucrative auto
mobile contracts.
Whatever the outcome of the present
campaign, a further invasion of the
Detroit market is likely on the part
Of the smaller companies. Great Lakes
Steel Corp. is ready to let a contract
for new strip mill The McClouth
Steep Corp. is rushing a mill to roll hot
strip steel. The Rotary Electric Steel
Co., recent newcomer, has put into
operation a cold-rolled strip mill to
double its finished steel capacity. In
the meantime, almost all of the De-
troit downriver communities have been
talked Of, at ore time or another, as
the site for steel operations.
(Copyright 1934)