Foreign Relations of the United States: Diplomatic Papers, 1945, The British Commonwealth, The Far East, Volume VI

811.79641/10–2045: Telegram

The Chargé in the United Kingdom (Gallman) to the Secretary of State

London, October 20, 1945—4 p.m.
[Received October 20—2:50 p.m.]

11009. Gallop of Foreign Office and Cribbett, Deputy Director General of Civil Aviation, asked us to call this morning and expressed serious concern over Panam’s (Pan American Airline) recently announced trans-Atlantic rate.¹³ Cribbett expressed belief that no company could operate profitably at this rate and that Trippe¹⁴ was determined to use Panam’s substantial reserves to force both his American and British competitors out of trans-Atlantic run. He read telegram from Masefield¹⁵ to indicate that other American operators and Department were also seriously concerned over Panam’s rate. He stated that British Govt was urgently seeking means of dealing with this problem.

His proposal, which was made only orally, was that United States Govt agree to denunciation of 1937 exchange of notes. He stated that 1937 agreement would be superseded, without interruption of services, by interim arrangement which would provide frequencies of five weekly for Panam and three for Export. It would also provide for agreement on rates (repeat agreement on rates). He also expressed willingness to proceed as quickly as possible in negotiating permanent agreement. He and Gallop both expressed British Govt’s reluctance to denounce 1937 agreement unilaterally and strong hope that we would be sufficiently disturbed by Panam’s rate either to join in denouncing agreement or publicly to acquiesce in British denunciation. We did not comment other than to express opinion that unilateral British denunciation would have regrettable effect on American public opinion. They indicated that no action was contemplated to prevent Panam inaugurating service next week but they hoped steps could be taken and announced before end of next week. Your urgent instructions will be appreciated. In this connection, see our 11008, October 20, 4 p.m.

Cribbett remarked incidentally that while the Government was publicly committed to stating its aviation policy on November 1,¹⁶ no agreement within Cabinet on aviation policy was in sight.

Gallman

13. Pan American Airways, Inc., had announced intention to fix its New York-London rate at $275.
14. Juan T. Trippe, President of Pan American Airways, Inc.
15. Peter Masefield, Civil Air Attaché, British Embassy.
16. For text of statement on that date by Lord Winster, British Minister of Civil Aviation, see Parliamentary Debates, House of Lords, 5th series, vol. 137, col. 623.