Business & Finance: Street Cars

Street car operators and manufacturers of their equipment, who were holding their yearly convention in Cleveland last week, were delighted with the words of their chief speaker—Owen D. Young, lawyer Chairman of the General Electric Co. His company sells service to electric power & light companies, which in turn sell current to street railways.

Few car companies have made money since the War. Cost of equipment and wages has gone up; motor cars have decoyed passengers and, by crowding thoroughfares, have increased cost of running cars.

Many companies by honest explanation of their money troubles or by aid of politicians have succeeded in getting local fares increased—but not enough to pay good dividends on their capital stock.

The situation first perturbed Mr. Young, then aroused him. When he is aroused, he speaks sharply. And sharply did he speak last week:

“Certainly the farmer in 1928 does not expect to feed his horses half the oats he did in 1914 and get the same service from them. That is exactly, however, what the public is demanding where it still insists on the 5¢ fare. If a 5¢ fare is insisted upon where on an average it costs 8¢ to transport, why talk about private capital doing that job? It simply cannot be done. Nor can it be done any cheaper by public capital, but we can tax the community instead of the individual rider to make up the difference.”

Because whatever Mr. Young says is heeded by businessmen, the street car operators at Cleveland last week hoped to get all their communities to permit fares increased to between 8 and 11¢ a ride.

The American Electric Railway Association has made its meeting & exposition at Cleveland a yearly affair. One attraction is that the Cleveland Railway Co. has the privilege of raising (or lowering) fares to provide ample money for dividends on its capital stock and for experiments in street railway operations. Practically every other company in the country is bound by franchise always to charge fixed fares. Cleveland thus is the inspiration and hope of such companies.

Striking this year is a street car built largely of aluminum. It is 25% to 33% lighter than ordinary cars, and so cheaper to operate.