In the meantime, he pointed out that he thought we were a great deal more apt to make #@ savings in our unit costs through an increase in the production than they are and that he thought that we could give them something on the extra guns to help them make the effort required to increase their installation. He wished to assure us that it will not be considered as a precedent for next year and that he would consider next year's prices according to the circumstances at that time. He indicated that he would out this in writing. I might mention one further argument which might interest you. le said he could only consider his present margin satisfactory a basis for increasing his investment in the installation if » had a guarantee of say &0,000 automatics per year for 5 years. did not think, however, that you would feel that certain of your sales analyses, As Laloux indicated himself, I believe accept the terms which we have offered automatics. considerable that them they will finally at least for 10,000 JI also believe, however, that it reluctance at the present prices will be with and that this reluctance in turn will have a very definite bearing upon their actual performance as far as deliveries are concerned. l1 do not mean that the program will be sabotaged; it will be honorably undertaken. But you know that no considerable rise in our production can be achieved without the occasional necessity of some energetic measures both with respect to their personnel and to their equipment. The more profitable the matter is, the less patient the direction is likely to be with excuses for delays and the less hesitant about hurting the feelings of their subordinates. Also the more effective our own action can be. As you know, a good deal of our time each day is spent in remonstrating and cajoling in an effort to obtain timely deliveries, but this is not our factory. We have only the power of persuasion and it becomes increasingly difficult to overcome indifference to low margin work. I entirely agree for a price increase that their tendency to run to their (and we have been fortunate customers compared with their other clients) instead of first exhausting every possibility for increased efficiency in their own backyard is basically fallaceous. There is no need to convince me of the desirability of high volume -— I have been consistently for it -- nor of the danger of new competition if we do not fill the demand. I would also agree that we would be stronger with another source of supply; our own factory, or a substantial interest and voice in F.N.s this is a subject which we have talked about before and I hope that it will be the subject of a thourough discussion during my forthcoming visit in Ogden,