H.J. at Work

Mobilization Boss Charles E. Wilson and Industrialist Henry J. Kaiser donned asbestos gloves and protective goggles. Then, before 600 guests who had been flown to New Orleans from all over the

U.S. for the event, they stepped up to a giant, red-hot ladle, tugged at the 20-foot handle and poured a mold full of aluminum--the first produced in what will be the biggest U.S. aluminum plant. When Kaiser's plant is completed in mid-1953, it will turn out 200,000 tons of aluminum annually, more than the entire U.S. industry produced in 1939.

The plant had a special significance for New Orleans, which does not have much heavy industry. Kaiser is the first to run an aluminum plant on Louisiana's natural gas. Now that he has shown the way, New Orleans hopes that other industries will follow. For his new plant, Kaiser got a well-deserved pat on the back from Wilson. He had raised the $115 million for aluminum expansion from private sources, got the plant going in only ten months, and doubled its planned capacity in the process.

Millions & Millions. Once in debt to the Government up to his eyeballs, Henry Kaiser has now paid off more than $244 million. Of all his enterprises, ranging from autos, cement, magnesium and steel to aluminum and houses, only his auto company, Kaiser-Frazer, is still in debt to the U.S. It owes $51 million. Kaiser has little trouble getting money from private sources. He has recently arranged for: i) a $17,-500,000 preferred-stock issue to finance the rest of his new aluminum plant, and 2) $65 million in new private financing to add a third blast furnace, a ninth open-hearth furnace and 90 new coke ovens to his Fontana steel works in California.

Private investors are willing to plunk such huge sums into the Kaiser empire because, with the exception of K-F, it is making money fast. Fontana in the past five months alone has boosted ingot output by 16%, made more money in October than in any other month on record. Its earnings ($2,500,000 in the last quarter) are running 30% ahead of last year, v. a decline for the rest of the steel industry. Kaiser's aluminum company is also netting more after taxes than last year, despite a 60% increase in its tax bill. Kaiser's explanation: "Efficiency." His aluminum net for nine months is equal to 12.5% of sales, v. 7.6% for the two other U.S. producers. But not even "efficiency" was sufficient, in the case of his Permanente Cement Co., to overcome higher taxes. Earnings are down 20% this year.

Boxcars & Backlogs. Kaiser is once more working and talking like the miracle man of World War II. Last July he reopened the Government-owned magnesium plant at Manteca, Calif., already has it back to full capacity of 20 million lbs. a year. Kaiser-Frazer, which lost money in the latest quarter, is busy with defense work. At Willow Run, K-F will turn out its first C-119 "flying boxcar" this month, its first Chase assault transport plane (the C-123) by mid-1952. K-F:s engine division is producing engines for North American's T-28 trainer, and at its plants in California, K-F is turning out wing flaps and waist sections for Lockheed's Navy patrol bomber, castings for Boeing. Says Henry of K-F: "Do you think I'm worried? How could I be when I see well over $500 million in defense backlogs? As for earnings, I can't be bothered to worry about accounting mechanics--pushing figures back & forth. Why, after this [rearmament] trouble, I see ribbons of cargo planes in the sky."

Nor is Kaiser worried about overexpansion in his other enterprises. "Take aluminum," says he. "They have come up with undreamed-of uses for aluminum. I ask, why not aluminum bridges? I see every bridge in America made out of aluminum." If this vision is somewhat hard for others to see, there is a good explanation. Says Henry: "Since you can't be clairvoyant, you've got to be optimistic."

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