The Ambassador in Chile (Bowers) to the Secretary of State
[Received December 16—1:32 a.m.]
305. Raúl Simón, manager of Grace22 in Chile, has informed me that the German Condor Air Line is attempting to obtain authority for a service between Santiago and Arica and that he felt that extension of such authorization by the Chilean Government a serious threat. While my Military Attaché is inclined to discount this possibility (lack of German flying equipment) and even to consider that Simón’s approach to me may not be unconnected with Panagra22 subsidy discussions in Washington, I wish to point out that the present Panagra Santiago-Arica schedule is entirely inadequate and scarcely better than once a week since there is a 5-day gap in the twice a week service. When Harris23 of Panagra was here recently he admitted that Panagra should have a three times a week service between Santiago and Arica and that unless they did the Germans would capitalize the present opportunity.…
In any case, however, I desire to emphasize that in my opinion the present Panagra service between here and Arica is altogether unsatisfactory and cannot but create an opportunity for German interests to endeavor to capitalize. Successful opposition to German proposals in the premises would, of course, be greatly facilitated if I had specific information on what Panagra is prepared to do, and how soon, to remedy the defects in the present schedule.