BRITISH SHIPYARDS.

New Zealand Herald, Volume LXVI, Issue 20384, 12 October 1929, Page 11

BRITISH SHIPYARDS.

NEW CRISIS THREATEN I NOV

REACTION FROM RECENT SPURT. ,

LACK OF ORDERS FOR FUTURE.

Br SIR ARCHIBALD HURD. Unless some unexpected event takes place, the coming winter will be a bad one for the British shipbuilding industry, which at one time sent afloat four- qut of every five new ships under the mercantile flags of the world; the majorily of the building; berths will be empty and 30 or 40 percent, of the workers idle.

The position is a curious one. Toward tho end of last year, when it seemed certain that widespread discharges from British shipyards would have to take place, Sir. Alexander Kennedy, a former president of the Shipbuilding Employers' Federation, appealed to shipowners 'to anticipate their requirements of new tonnage. This plea for work was supported by other leading shipbuilders. They offered to build ships without hope of profit, just to keep their skilled draughtsmen and other experts together and their workmen ''off the dole.' A large number of shipowners responded, though somo' of them protested that in their opinion there were already too many ships for the limited cargoes available. Many orders were placed in these circumstances, but at prices which represented no profit, and in somo ■ cases loss. Shipping on the Stocks. Tho result of this emergency appeal has since been reflected in the shipyards. When the last survey was made of the work in hand,' it* was found that" there were under construction 365 merchant vessels of 1,453,906 tons gross, 251,296 tons more than at the corresponding period of 1928. The following statement shows the work in hand in British and foreign yards and the percentages in each country of the world's total:—•

In spite of these figures, the position in British shipyards is for two reasons really very grave. In the first place, no profit is being made on the wprk in hand, and, in the second place, few new orders' have been placed for some tifiie, with the consequence that slips from which new vessels are being launched have to remain empty. A leading authority has stated that "a crisis is approaching as grave as, and possibly even more grave than, any hitherto experienced, as every employer in the industry up and down the country realises with feelings of grave apprehension.''- , " Claims For Higher Wages. One source of anxiety is that the leaders of the trade unions, who are politicians first and industrial leaders . only secondly, refuse to realise that dark clouds are on the horizon. They are making the most of the combination of fortuitous circumstances which increased the amount of tonnage in hand early, this year. It is only necessary, so trade leaders have urged, for a final spurt to be made to fill additional slips and absorb nq mean proportion of the men \pho are at present idle,*- That is' the delusion under . which trade union leaders are acting- They arc making the most of the fact that, at no mean sacrifice to investors in shipbuilding, not far short of 1,500,000 tons ot shipping are in hand, and the knowledge that the proportion of unemployed, which was upwards of 33 per cent, not so long ago, has been brought down to about 20 per cent, as a result of this increased activity. They will not believe that the shipbuilders in protesting that they are making ,no profits are not deceiving them,; though there are audited balance-sheets in proof . of the statement. The signs of apparent prosperity in the industry nave encouraged them to put forward claims for higher < wages, and the employers have felt compelled to offer : concessions/ representing a further addition to costs. Shipowners protest that present pricies for tonnage, in ; view of the low freights now ruling, are already too high. Any increase in labour charges must consequently dheck placing of fresh orders ana add to ,-:the difficulties under which shipbuilders are struggling.. . ' ' .'■

Flea foif nationalisation. Appearances are,. , however, deceptive. ■ The industry is in a'distressful condition and there are no further administrative economies that can be ftbade. One of the largest employers stated recently that the overhead costs of his yard had been so repeatedly and ruthlessly ; pared, down that they "were now less thin 40 percent, above the figure of 1914. • This • statement probably applies to the majority of the efficient shipyards- of the country and the success— which has been achieved in -face of many. difficulties may be appreciated when it is borne m mihd that the "cost of living index figures is 60 per cent, above .the pre-war level. Month by month the amount of work in hand is decreasing. Appeals of the character. which were made last year cannot be relied upon to avert another crisis. The weakness of such emergency, orders is that they merely anticipate work ana thus create delusive conditions or apparent prosperity. They cannot be repeated employer of labour in dustry remarked the other day There is no hope of salvation for the industry except in some scheme of Wo must get together later, and the sooner tRe better, and set our house in order. There is no prospect that 15 the slips will be filled and all the labour employed at any future time. We must recognise that the capacity of. the industry is about 50 per cent, above the probable demand and take action to meet the situation, so as to end the present cut-throat competition which is weakening the industry." Other shipbuilders, taking a wide survey of the situation, nave, as inquiries show, reached the same conclusion. They admit that the shipbuilding industry cannot continue indefinitely to be conducted at a loss. Its resources must bo exhausted unless active demand and capacity for supply can be brought into closer relationship.

Surplus of {Shipping. The attitude of shipowners can bfl stated in a few words. They point out first that there is already more tonnage afloat than the trade of the wodd requires, and secondly, that the British merchant navy is a highly efficient transport organisation, so many new vessels having been built since the war closed with a deficit of tonnage arising from the losses duo to enemy Only 3.364,000 tons gross are over 20 years old. Most of these ships are still able to earn profits, because they figure in their owners' books at verv low values, depreciation having been written off year by year. The owners, impressed by the cost of new tonnage, decline to send them to the scrap heap. They point out,_ moreover, that nearly, half the ships in the British merchant navy have been built in the last 10 years, and that in this respect the position is as good as it lias ever been. Finally, shipowners ask since first, so much efficient British shipping is idle, secondly so many vessels stilll n commission have their holds y filled voyage after voyage, and th rdlV, since freights continue so low as Wj,; £ to cover out-of-pocket . expenses, why.. should more orders be given. , That is the impasse which U* ms«m,. threatening a more serious British shipyards than >S occur™ in the past. D '

. Tons crona. Per cent. Great Britain . ■ 1,453,901) 51.2 Germany .. 272.441 ' 9.6 Japan 17:J.96ii~ ' 6.3 Holland . 172.40(> 6.1 France .. . 139.31ft 4.9 Russia .. 124.90(5 4.4 United States . 119.093 4.2 Sweden 89.517 I. .. 3.2 Italy .. . .73.661 2.6 Denmark . . . ' 6B.009 • Others f .. 1 141.792 6.1 Total . 2.833.225 mo