825.77/284: Telegram

The Secretary of State to the Chargé in Chile ( Scotten )

85. Representatives of the Pullman Standard Car Export Corporation called at Department today regarding prospective order for 21 coaches. From recent experience on locomotive business lost by the Americans to the Germans it is unlikely American prices will be competitive because of German export subsidy, reported to amount to as much as 60 per cent. In view of similarity of amount of subsidy and the amount of spread between official and export rate, and also severe competition from Germans not experienced in other South [Page 395] American countries and sudden decision railways to close negotiations this year, the question arises whether there is any discrimination against United States in exchange rates at which Germans are negotiating business. Please confer at once with Wessel Duval, representatives of Pullman, and if in your judgment discrimination seems probable, discuss the matter informally with appropriate Chilean authorities and ask that there be no discrimination against American interests which desire to compete on even terms with other foreign interests in Chile.