GERMAN LOSSES.

Auckland Star, Volume LVII, Issue 258, 30 October 1926, Page 9

GERMAN LOSSES.

ON MOTOR BOAT CONTRACTS. WBT BBITIBH TEHDERg FAILED. LONDON, October 22. The Labour correspondent of the "Daily Telegraph" reports that there has been an interesting development of an event which caused astonishment, in British industrial circles—and partioularly in shipbuilding circles—in the early part of 1925. Consternation was created by the report that a German shipbuilding firm had succeeded in taking the contract offered by Messrs. Furness, Withy and Co. ior the construction of five large motor-ships, although several British firms had given in tenders. Having regard to the parlous state of British shipbuilding, these tenders were cut to bare costs, but the German offer was so very much lower that had all wage costs been left out of the British prices the German firm would still have taken the business. The German firm was the Deutsche Werft A.G., of Eamburg, and the fact that it was able to lift so important a contract by such a wide marfrin occasioned no little recrimination within the industry. At the time 30,000 men were unemployed in our shipyards. It was after this revelation that the employers and the trade unions agreed to a joint investigation, and a careful analysis followed. Now from j the "successful" German firm itself comes the explanation, for the annual report of the Deutsche Werft Company contains a complete vindication of the British firms tendered. That report shows a deficit on two years' working in the" German yard of 2,800,000 marks, or more than half the share capital. To meet the loss, the reserve fund of 323,000 marks is to be used, and the share capital written off in the proportion of 2 to 1, whilt a further issue will be made of two and a half million marks in new shares, thus bringing up the capital to the original figure of. five million marks. All the new shares are to be taken up by the founders of the Deutsche'Werft. As the loss referred- to is spread over two years, of course it cannot be due eptirely to the acceptance of the Furness Withy contracts, but this particular attempt to secure British orders must have been responsible for a good deal of the loss of the last year—a sum of 1,600,000 marks—and it is definitely quoted in the report as a "serious source of loss."