December i; 1920 



THE INDIA RUBBER WORLD 



lyv 



THE RUBBER TRADE IN OHIO 

 By Our Regular Correspondent 



AKRON NOTES 



THE WEEK ended November 14 will In- luld niemorable in the 

 annals of finances and industry in Akron, the rubber center 

 of the world. During the week the reduction of tire prices 

 started, and within three days had run its limit, The Goodyear 

 Tire & Rubber Co. announced its financial readjustment plan and 

 within two hours of this announceinent for the first time in its 

 history passed a dividend upon the common stock. 



The first factory to reduce tire prices was The Mason Tire & 

 Rubber Co. of Kent, which announced early in the week that a 

 cut of 12J/$ per cent would become effective immediately. 



Two days later, while officials of The B. F. Goodrich Co. were 

 ni New York discussing the reduction of tire prices. The Good- 

 year Tire & Rubber Co. made public a new scale of prices in 

 which a reduction of 3 to 14 per cent was apparent. The Miller 

 Rubber Co. announcement came at S o'clock in the afternoon and 

 The B. F. Goodrich Co. made public its new prices showing an 

 average decrease approximating 12 to 13 per cent shortly after 

 8 o'clock the same evening. 



Although up to the time of writing the smaller companies have 

 not announced decreases, it is well understood that most of them 

 have prepared a number of price lists and the ones coming closest 

 to the prices of the larger companies will be given out to the 

 public within a few days. 



The long looked for decrease is at hand and it is now only a 

 matter of a few weeks until the industry will know definitely if 

 the public has been refusing to purchase tires until the prices de- 

 creased or if motorists will persist in putting their cars up for 

 the winter. 



Reports received from every section of the country show that 

 many motorists are running upon tires which are usually dis- 

 carded and that many of them are without spares. If this is the 

 case it would not be surprising to find the so-called large surplus 

 of tires wiped out by the public within a few weeks. According 

 to figures given out by George M. Stadelman of The Goodyear 

 Tire & Rubber Co., only one surplus tire is on the market for 

 every automobile in the country. If tire users have been holding 

 off for lower prices they will be able to take up this surplus very 

 quickly and leave the market ready to take on tires now being 

 manufactured. 



The passing of the dividend on common stock is looked upon 

 generally as a wise move on the part of the Goodyear directors. 

 In the formal letter which carried the announcement the directors 

 stated that the action was taken to conserve the company's cash 

 reserves. 



Although it naturally hurts the pride of successful industrial 

 heads to be compelled to pass dividends, the action of the Good- 

 year directors is generally looked upon as the best possible step, 

 because actual cash is very difficult to obtain at present and the 

 payment of the dividend would have taken $1,500,000 from the 

 company's cash reserves. This money can be used to better ad- 

 vantage in the business at this time and therefore Akron bankers 

 generally look upon the move with favor. 



The refinancing of the Goodyear company, which gives $25,- 

 000,000 new credits, became public through a letter written to 

 the sales department by L. C. Rockhill. genera! sales manager, in 

 which the men are urged to redouble their efforts to get business. 



The inventories of the completed goods of the company have 

 been assigned by the company to the bankers furnishing the loan, 

 and in this way the plant is left unencumbered and the manage- 

 ment remains in the present hands. 



Upon the same day the Goodyear dividend action was published, 

 officials of the International Harvester Co. announced that steps 

 will be taken immediately to increase at least 20 per cent the 

 output of the Akron factories, producing motor trucks chiefly. 



If development for future business and for a greater population 



can he looked upon as showing the confidence of the inhabitants 

 of .\kron in the stability of the rubber industry, regardless of 

 the thou>ands of rumors which have emanated from the city 

 (luring the past four months, then the verdict is "the future of 

 the business is good." 



The people of .'\kron were asked at the last election to pass 

 upon a $2,000,000 bond issue to provide much needed parks ; 

 also a bond issue to provide an elaborate approach to a $2,000,000 

 viaduct through the heart of the city. 



The issue was clear cut. If .-Xkron is not to grow in the future, 

 there is no need of providing parks for increasing population and 

 the approach now contemplated, for the bridge will be adequate. 

 The voters clearly understood the problem and approved both 

 bond issues. 



No other interpretation was placed upon this verdict by ,\kron 

 business mer, than that the rank and file of -Akron people look 

 with equanimity on the future of the industry, especially in view 

 of the election having restored a large measure of confidence 

 throughout the country. 



The past year was the greatest year in the rubber industry 

 here. Reports from factory heads indicate that the business of 

 the Firestone Tire & Rubber Co. will amount to approximately 

 $107,000,000, which is an increase of $16,000,000 over the $91,- 

 000.000 sales record of last year. 



The Miller Rubber Co. will do more than $31,000,000, as com- 

 pared with $27,000,000 last year, atid The B. F. Goodrich Co., 

 with two months' business to be heard from, has unofficially 

 stated that the business thus far this year exceeds the $140,000,000 

 of last year. 



The figures for The Goodyear Tire & Rubber Co., showing an 

 annual business of $205,000,000, an increase of $38,000,000 over 

 last year, have been officially aimounced. Thus the four large 

 industries have a good foundation upon which to start the coming 

 year. 



Reports regarding annual sales from the smaller plants are 

 not available, but they have had all the advantage of the drop 

 in fabric and crude rubber prices and their business should show 

 a larger percentage of gain over last year and their net profits 

 should be larger proportionately than that of the larger com- 

 panies, because their inventory shrinkage will be smaller. 



Some of the larger companies were caught with large supplies 

 of raw material on their hands when the bottom dropped out 

 of the material market, and this will be reflected in their in- 

 ventory reports. The smaller companies, as a rule, did not have 

 the money to make long-term contracts and were unable to buy 

 lip large supplies, with the result that they were able to go into 

 the open market and purchase cheaper material. 



That the industries of Akron, including the rubber companies, 

 have done more business during the twelve months ended No- 

 vember 1 than during any previous year, was shown when of- 

 ficials of the Chamber of Commerce announced at the annual 

 dinner and meeting, November 18, that the annual survey of the 

 Chamber showed total sales for Akron industries of $599,240,268, 

 as compared with $522,436,021 during the previous twelve months. 



The figures gathered annually by the Chamber at present in- 

 clude figures from fourteen rubber factories whose sales for the 

 present year have increased from $427,341,611 in 1918-1919 to 

 $545,812,311 for the present year. 



The pay-rolls of the Akron industries during the year amounted 

 to $143,330,572, as compared with $117,974,891 during the previous 

 year. The survey showed that an average of 72,397 men and 

 women were employed in Akron during the year, as compared 

 with 79.000 November 1, 1919. 



Reports to the Chamber show that the banks cleared during 

 the year $589,721,000; that $24,301,613 worth of building permits 

 were issued, including 4,621 homes valued at $6,312,354; that the 

 post office receipts amounted to $1,195,380, and bank deposits 

 totaled $72,165,195. 



