Word: fontana
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Dates: during 1940-1949
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...trouble started when Big Steel madea deal to buy Los Angeles Consolidated Steel Corp. (TIME, Dec. 30). Kaiser complained that this was a rabbit punch to his own Fontana steel plant, which supplied Consolidated. Presumably, Consolidated would now buy from its new owner, Big Steel. About a month ago, Kaiser again felt the hot breath of Big Steel on his neck. Through a dicker with four western railroads, Big Steel had won a $4-40-a-ton reduction in the freight rate on steel shipped from Geneva to the coast...
Kaiser's own shipping costs for steel from his Fontana plant had gone up 17½% in the general freight rate carriers. At the news that his Utah competitor was actually getting a reduction, he jumped as if someone had dropped a hot rivet in his pocket. The lowered Geneva freight cut, he cried, would amount to a "subsidy of some $1,200,000 a year" to Geneva. In his complaint Kaiser had some strange allies: the eastern steel companies, competitors of U.S. Steel, whom he had long condemned...
...freight cut would, he said, be passed on directly to consumers. They would get the cheaper steel which the company had promised the West Coast when it bought Geneva. But Kaiser, thrown into a bad competitive position, was undoubtedly not interested in cheaper steel if it meant closing up Fontana. And it might mean just that when the current steel shortage is over...
...Fontana's costs, largely because of the $105,000,000 it still owes RFC, are far higher than Geneva's. So Kaiser's most practical move was to ask the railroads which serve him to give him the same reduction as Geneva had gotten from its carriers. He wanted lower rates on all steelmaking materials brought to Fontana as well as on his outbound shipments...
...help of two potent allies. Attorney General Tom C. Clark filed suit to keep Big Steel's Columbia from buying Consolidated on grounds that it would give Steel a virtual monopoly on West Coast steelmaking and fabricating. The RFC, worried about its huge investment in Fontana, also asked the ICC to hold up the Geneva reduction...