Evening star., 1941-05-11
|ndustryFaces
Dis|ocationsin
Defense Drive
Steel Chiefs Weigh
Big Expansion; Auto
Plants Rushed
By FRANK MacMILLES,
Associated Press Business Writer.

Associated fIehs ouSAIleeo
NEW YORK, May l0.-Evidencs
is piling up, business men said TO-
dav, that diSlocations in the war.
driven production machinery Of the
country may be nearer and of Sc
verer character than has been gen.
orally appreciated.
AS factory wheels continued to
gain impetus this week after the
brief pause occasioned by the re-
unt coal strike, the quantity OF
goods pouring into the armament
stream, as we'll as into civilian use,
had nearly cancelled out the earlier
hesitation.
But the very rapidity of the re-
covery-nearly 6 per cent IN the
past three weeks as measured by
the Associated Press index of in
dustrial activity-turned many busl-
ness minds to the clearly fore
shadowed problems of the fall and
winter months.
Steel mills were tagging as the
effect of coke and pig-iron Short
ages still made themselves felt.
Auto Plants In Race.
But automobile making was rush.
ing along at the rate Of more than
100000 cars a month as factories
tried to turn out every vehicle pos
sible, not only for the current his
toric peak in customers demand. but
against the 20 per cent cut already
ordered in the number of new model
cars beginning next fall.
Automobile men mentioned. as one
of the problems that would press
sooner than had been expected. this
slice in outturn of civilian vehicles.
Plans, they revealed, were being laid
only for the first six months of the
new model year and even these
schedules were dependent on ability
to get steel.
Meantime steel men, faced with
an apparently steadily accelerating
call for the materials for ships, guns
and scores of other defense items,
appeared much less confident than
short time ago how far it would
be necessary to hold back supplies
from civilian use to supply the armed
forces and Britain.
Inventories Controlled.
Washington authorities this week
assumed inventory control-(a sort
of modified priorities system)-over
IS metals widely used in industry,
including several steel items, as they
| prepared machinery to assure that
| defense got first call.
President Roosevelt's call for the
operation Of defense plants the
clock around every day in the week
and first steps to put this into
effect in the vital machine tool
business. steel men said, meant
further revision in ideas as to how
much of the hard metal would be
needed in coming months.
Men in steel Offices heard that
Gano Dunn. who two months ago
surveyed the steel capacity of the
country at the request of defense
authorities and concluded that they
were adequate, was already revising
his figures upward substantially.
Railroad equipment manufac-
turers. too, trade quarters said, we're
watching the key steel industry
because they believed the carriers
would need more cars and equipment
in the next year or two than had
been counted on in early calcula-
| tions.
OIds Indicates Change.
Irving S. Olds. chairman Of the
United States Steel Corp. talking
to stockholders at the annual meet
ing. possibly foreshadoWed an i'm
portant change in the attitude Of
steel executives when he admitted
the corporation did not know
whether the steel capacity of the
country was adequate and expressed
a willingness to build more facilities
if needed.
Meantime the top executives of
practically every steel company in
the United States met in New York
and appointed an industry defense
committee to cooperate with the
Office of Production Management
in Washington.
1t appeared significant that the
meeting lasted much longer than
mere balloting on a committee would
normally require and that much Of
the talk of the steel members in
the lobbies afterward was of the
moot question of building more
plants.
Business Week" said today:
THE demands on steel producers
have far outstripped early esti-
mates. Apparently this coun-
try has been going through the
identical phase of Understanding
that dogged and delayed the British