Evening star., 1939-06-22
Weir Calls on Steel
Industry 10 Stop
Profit|ess Era
BIomes Monoeements
For Lack Of Margin
Above Costs
BY MARBEN GRAHAM,
Associated Press Financial Writer


PITTSBURGH, June 22-Ernest
T. Weir today charged the man.
agements of big steel corporations
with the principal responsibility"
for the industry's nine-year losing
streak and advanced as a solution
what he termed simple formula
Of sound common sense"
Fundamentally there is nothing
wrong with our business" explained
the recently elected head of the
American Iron and Steel Institute,
replying to request for his analy-
sis of the industry's ailments.
1T is principally management that
is responsible for our plight. Not
politics. Not economics. Not high
labor costs. AS I've said before
I'm against reducing wages.
Il maintain that if the manage
ment of any company is conducted
in a sound way it will make profits
even at low levels of operation. And
there is nothing mysterious about
sound way The only way to make
a profit is to sell at a price higher
than cost"
Prices Held Too Low.
Weir's indictment of manage
ments-he cited later the figures
from the nine largest concerns as
a specific instance-came as the
third blast by prominent indie
pendent operator since a series of
slashings several months ago set
the industry a-jitter.
independents" is the term used
by steelmen in reference to con-
Germs other than units of the United
States Steel Corp.
Tom Girdler, head of the Republic
Steel Corp; Charles M. Schwab,
chairman of Bethlehem, and Weir
himself. chairman of the National
Steel Corp, all have declared steel
prices now are too low.
Weir drew from his big flat-top-
ped desk the latest financial figures
on steel. The quiet. plush -carpeted
skyscraper office with its rose-col-
ored drapes and picturesque view of
the two great rivers forming the
Ohio below, must often be pleas
ant reminder by its contrast to the
man who came up the hard way"
from humble Office boy to organizer
and head of Americas fifth largest
steel corporation.
The figures showed the nine larg-
est companies, producing more than
30 per cent of the steel output, had
borrowed 512 million dollars in the
past nine years; spent a billion. ISL
million in new construction. and re-
ported net loss of 80 million.
Cites Investments.
The common stockholders are
long-suffering group" he remarked
They have invested in these con-
Germs. including our own. two bill
lion, 100 million dollars. They would
have received a better return even
from savings banks"
Turning to the general competi-
tive situation, Weir said he believed
all companies today were virtually
equal from a production cost stand
point. He said also the equaliza-
tlon OF prices at the main baS1ng
points inaugurated a year ago by
United States Steel had made "abso-
lutely no difference" in the COM
petitive picture.
1--WE don't need any Government
interference" Weir insisted, "and
there is no necessity for industry
wide controls or cartels now COM
mon in Europe.
I'm still an individualist. And
there is nothing to prevent any COM
pany from making a fair profit if it
merchandlses with intelligence.
THE prime responsibility of each
executive not only to his employees
and stockholders. but to the public
as we'll, is to see that a profit is
made"