Does Road Transport Skim the Cream?
Page 23
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I HAVE not always agreed with the views about rail'way transport expressed, in your journal, and even allowed myself to think, at times, that you were prejudiced in favour of the road, but never to a sufficient extent before to prompt me to put pen to paper. That I do so now is because I cannot understand your interpretation of the meaning of the old expression, "Skimming the cream of the traffic," and your conclusion that it amounts to an illusion.
We, who have been struggling for years in Argentina to try to earn a fair return on some 250 millions of pounds of British capital invested in railways and, since roads and road transport have developed, have seen, with our hands tied by 'unsympathetic Governments, the cram of our traffic taken by irresponsible small
operators with hire-purchased 'vehicles s(to he abandoned when a new set of
tyres is needed), who will take no share in carrying the undesirable, rollingstock destroying, non-paying commodities like road stone, forestilf products, firewood, etc., • have no illusions as to what the expression means.
. I believe I am right in saying that railways throughout the. world arc compelled, by their concessions, to refuse no traffic they can physically carry, to accept it in turn according to applications for wagons, and to give no advantage% either in rates or in conditions of carriage to one customer against another.
I admit that they have been authorized in some countries to depart from these maxims to a small extent, when Governments have realized that the alternative of freedom from control would not suit their convenience, but in general terms these anti-monopoly measures have been, and still are, enforced rigidly whenever a railway has been showing a possibility of paying a dividend on its ordinary stock.
The lactic analogy in my interpretation means that whilst the railways are compelled by their concessions to accept all the constituents of the milk, i.e., the cream, the skim milk and the " suero," to carry them at a price the people concerned can afford to pay, and to take them in the order in which application for transport is made, the road transport operator has no such obligation and can take or refuse whatever he likes. He accepts no responsibility for the welfare of the country, and if he chooses to lend a hand with the not-verydesirable, perishable dairy traffic, he will certainly take only the cream, unless the alternative be empty mileage.
Now, I know that you must know all this as well as, or better than, I do, and I cannot understand why you did not point out to Mr. Schwartz that the railways would never complain about the cream of the traffic being taken if they were relieved of their responsibilities and allowed to pick and choose like all other means for transport, including the "Queen Elizabeth,coasting steamers and aircraft.
I feel rather sore about this, because, in this country, had we been given freedom as have the road transport operators, we would have earned dividends without upsetting the commercial prosperity of the country, and at the termination of our concessions on January 1, 1947, we would have been able to sell out at our full capital value. i.e., 100 million pounds more than the 150 millions we received. I know that the journal
is "going strong," and I am paying you a sincere compliment when I tell you that I pay my own subscription to your paper now that the ex-British railways here have been taken over and many of us have retired.
Buenos Aires, Argentina. R. K. HUBBARD.
[Mr. R. K. Hubbard, the writer of this interesting and controversial letter was a leading executive in the formerly British-owned railways of Argentina. Before he left for foreign climes he wag an R.A.S.C. Majot at the War Office. The leading article upon which he takes us to task was entitled An Illusion Dispelled." In this we referred to an article by Mr. George Schwartz, the well
• known writer on economic matters, who, claimed that skimming the cream" is a normal and general economic principle, whether applied to road transport or other activities. Whilst sympathizing with Mr. Hubbard over • this matter, we must refer to the factor
• of \Suitability. Railways are essentially better suited to the carrying of large
• quantities of .heavy and bulky
• materials not requiring rapid delivery. The fact that they have virtually had to subsidize transport of this nature cannot be blamed upon road transport operators, the vehicles of whom possess particular qualifications in other direction, many of which are unrelated to the question 'of cost. New means and methods must in the nature of things, and if we are to have advancement, take their proper place in the transport field, whether or not they are competi
tive with the old. Road transport may eventually have to suffer at least some competition from air transport, but it would be wrong to stifle the latter for this reason.—ED.]
WAR-TIME MACHINE TOOLS— A WARNING DURING the war years the demand for gear-grinding
and spline-grinding machines was extremely heavy, and the output of our machines was many times more Than any normal consumption. A great many, of these tools have been offered for disposal through the Government Pool and auction sales. Many purchasers have been buying them without the knowledge that some were built to meet special requirements, with very, unsatisfactory results to themselves. Unfortunately the dissatisfaction ensuing sometimes resulted in giving wrong impressions of our desire to co-operate with any users of our Machines. .
What happens in so many cases is that a user buys one of these machines at what is apparently, a very low figure; then, when he wants to start it up, he gets into touch with us. Invariably we find inaccuracies, shortages of the right equipment, and sometimes types -which cannot be adapted at all, having been built for particular jobs.
The position has become very acute, and we now have to take steps to advise that we can take no responsibility for the proper operation of machines which are bought without consultation with us. ' All of this can be very expensive and sometimes unsatisfactory to both the user and ourselves.
I have no doubt that there are other manufacturers of specialized machines who are finding themselves in similar difficulties, therefore I am writing this letter in the hope that you will publish it and that it will be a helpful guide to potential, users of our and other specialized machines.
A. H. ORCUIT, Managing Director.
Birmingham. (For The Gear Grinding Co., Ltd.)