Foreign Relations of the United States: Diplomatic Papers, 1944, The American Republics, Volume VII

812.77/8–2144

Memorandum of Conversation, by Mr. William G. MacLean of the Division of Mexican Affairs

[Washington,] August 21, 1944.

Subject: Regulation of Freight Car Movement Between United States and Mexico.

Participants:	ODT:—Colonel J. M. Johnson, Director; Mr. H. F. McCarthy, Deputy Director; and Mr. Connor.
	Mexican National Railways:—Mr. Benjamin Méndez, Traffic Manager; and Mr. Raul Campos, Asst. Traffic Manager.
	Pemex:25—Mr. Rodolfo M. Fernández, and assistant.
	AAR:—Messrs. Buford, Chandler and Arnett.
	FEA:—Messrs. Brown, Gardiner and Scanlan.
	ICC:—Mr. Klinger [Clinger].
	CIAA:—Mr. De Camp and Major General Schley.
	State:—William G. MacLean, MA

Colonel Johnson opened the meeting with appropriate words of welcome to Messrs. Méndez and Campos of the Mexican National Railways, who had come to Washington as the result of exchanges of communications between the Department and Ambassador Messersmith and between the Office of Defense Transportation and the American Association of Railroads and Mr. Ortiz, General Manager of the Mexican National Railways. Colonel Johnson said that the object of the meeting was to consider the movement of railway freight cars between the United States and Mexico in view of the over-all war needs.

Mr. Méndez thanked Colonel Johnson for his welcome and made a very clear statement of the present situation, stating that the Mexican National Railways were embarrassed not only as neighbors but also technically speaking, because of the large number of American freight cars now in Mexico. He said that the National Lines, therefore, wishes to clear out many of the cars still there to bring the number of cars to a level which could be better handled, from which time it would be desirable to exchange cars on an equal basis.

Colonel Johnson then said that at present there were approximately 8,500 cars in Mexico, including refrigerator and tank cars, and Mr. Méndez immediately accepted that figure. Colonel Johnson said that at one time it had been mentioned that 5,000 cars would be a reasonable number, and Mr. Méndez immediately agreed and further stated that the Mexican Lines had been handicapped by too many cars in Mexico. Messrs. Johnson and Méndez agreed that Mexico would no doubt receive many more cars of merchandise if there were fewer cars in Mexico at a given time to clog the lines.

Colonel Johnson also stated that if the war in Europe was won at an early date, the ODT would then be faced with the tremendous problem of reversing the prevailing movement of freight and would have a greater volume than ever moving toward the Pacific Coast, which would make it increasingly important to secure every possible freight car. He said that it was this concern which made it necessary to regulate the use of American cars, not only between Mexico, Canada and the United States, but also as between shippers in the United States, including the War and Navy Departments and foreign governments to whom vast quantities of matériel had to be shipped by sea through certain base ports.

Mr. Méndez said he recognized these reasons as well as reasons of operating efficiency on the National Lines and that he was glad to say that the Mexican lines were now sending and would continue to send back cars over and above those sent in just as rapidly as possible. He said that it was difficult to determine off-hand what the correct number of cars in Mexico should be but that the National Lines definitely did not want as many cars as they now had. There was then almost immediate agreement that the determination of what material should be loaded for Mexico would be left to the Mexicans and that they would set up a sifting procedure in Mexico City. The results of the sifting would be communicated to Mr. Campos, who would remain here in Washington, who would inform Mr. Arnett of the American Association of Railroads what materials were to receive preference and therefore be licensed first.

Mr. Méndez said he had four points in mind in regard to this procedure:

(1) He would like to know what shipping permits were outstanding;

(2) It was planned to establish an office in Mexico City to determine what should be shipped;

(3) Mr. Campos will be informed daily of the determinations made and will communicate them to the AAR which would issue permits in conformance;

(4) Mr. Méndez said it would be helpful in this regard to establish an average number of cars which would be received from the United States during a month, and stated that cars would be sent out as fast as possible in excess of this number until possibly 5,000 cars were left in Mexico or possibly a much smaller number.

Colonel Johnson then reviewed the movement of cars since the restrictions were placed in force in June, and he and Mr. Méndez agreed that the objective would be to reduce the total number of cars to 6,000 by December 1, 1944.

It is interesting to note that Colonel Johnson established the objective of 6,000 rather than 5,000 as suggested by Mr. Méndez and that Colonel Johnson also took the initiative in establishing the December 1 date rather than an earlier one which Mr. Méndez had characterized as satisfactory.

Mr. McCarthy of the Office of Defense Transportation said that it would be very desirable to have all the machinery set up in Mexico before a change of system was announced, and it was agreed that this was a wise precaution. Messrs. Brown and Scanlan of the Foreign Economic Administration point out that the FEA had considerable interest in moving strategic materials to the United States and in moving machinery to Mexico to maintain the flow of these strategic items. It was agreed that this interest would definitely be kept in mind.

The meeting ended with an understanding that Messrs. Méndez and Campos would meet immediately with representatives of the AAR and work out a definite procedure which would then be submitted for discussion by the group present at the meeting described in this memorandum, the meeting to be called by Colonel Johnson as soon as the plan was completed. As indicated above, Colonel Johnson handled the situation very tactfully and there was apparently a complete meeting of minds on basic principles between those present.

25. Petróleos Mexicanos, Mexico’s Government-controlled oil industry.