Evening star., 1941-09-03
Industrial Capacity
Expansion Cost Set
9OO,OOO,OOO
Estimate of Yeor's
Investment Is Peck
For United Stotes
BY OLIVER MCKEE.

Due to the demands of the total
defense program, approximately
81 800 900 900 will be invested in new
manufacturing facilities and equip
ment this year, by far the largest
expenditure in our history, Lowell
]. Chawner, chief industrial econ
omist of the Commerce Depart
ment, estimated today. In 1910,
expenditures for plant and equip
ment totaled S2,303 900 900. and in
1920-the previous peak-they were
$3,165 100000.
Though manufacturers Of pre-
dominantly civilian goods are max
ing some additions to their produc-
ton facilities, the greatest expan-
sion is occurring in the war and
closely related industries, Mr..
ChaWner pointed out.
According to his estimates, based
on an extended study of reports
from American manufacturers and
other sources, $3.50 100000 will be
spent this year for additions TO
plants and new equipment, by in
dustries manufacturing munitions
and war supplies
S550,000,00 for Shipbuilding.
Principal items include the fol-
lowing: Airplanes, motors and
parts, 100000 ,000 chemicals, in
cluding powder, $3.50 100000; ship
building, 100000; ammunition.
shells and bombs, $430, 900 900, and
guns and small arms, $3.50 900 900.
In addition to the investment in
plants manufacturing munitions
and military equipment. it is esti-
mated that $1,310,00o,000 will be
spent in expanding industrial facili-
ties closely related TO defense. In
dicated expenditures of this type
include the following: Iron and
steel, s500,000 900; non-ferrous met
ais, $500, 900 600; petroleum prod
ucts and coal, $3.50, 900, 900, and ma
chinery, including electrical prod
ucts, $3.50 100000.
Plant equipment expenditures by
non-defense industries manufactur-
ing civilian goods will total less
than 81 ZOO, 1000 900 in 194l. Though
slightly larger than the correspond
ing totals last year, these expendi-
lures represent normal expansion.
Capital expenditures for manufac-
turing facilities, both public and
private, in terms of 1910 prices. in
creased from approximately $500
900, 900 in 1915, to S2,466, 900, 900 in
1918. This years additions, there
fore, will be twice the total for 1918,
when production effort during the
World War reached its peak.
During the two years following the
end of the war, new additions to
manufacturing facilities continued
at high level. Until this year, the
SO zoe, ,000, 900 expended in 1920 rep
resented an all time high. The
huge expenditures in 1919 and 1920
were largely due to the rapid read
justment of manufacturing facilities
to peace-time purposes, particularly
in the metal-working and automo-
bile industries. The volume also re-
flected the rising prices of these
years.
Adds Is Per Cent.
The Nations manufacturing facil-
tiles are valued today at approxi-
mately $4,000, 100000 Making al
lowances for depreciation, this years
expenditures are expected to add
$4,000, 900 900, or 13 per cent, to the
net capital invested in manufacture
ing. This will be the largest net
addition ever made in single year
to industrial capital. In recent
years, the net capital increases have
averaged from 2 to per cent.
This net addition in industrial
capital is more than twice the aver
age increase from 1917 to 1920, and
so per cent above the previous peak
of $4,000, ,0oo, 900 in 1920 During the
1930s depreciation charges more
than offset the new investment for
the decade as a whole.