Joe & Henry

From his West Coast summer home on Lake Tahoe, Shipbuilder Henry J. Kaiser last week long-distanced an old friend, Joseph Washington Frazer, president of Detroit's Graham-Paige Motors Corp. As reporters listened in, Shipbuilder Kaiser rumbled: "Congratulations, Joe." To which Joe replied: "Thanks for the flowers, Henry."

In this cozy fashion, Joe & Henry let out the best kept financial secret of the year. They have formed a new company, jointly owned by Kaiser interests and Graham-Paige, to invade the dog-eat-dog auto business. With Kaiser as board chairman and Joe Frazer as president, the Kaiser-Frazer Corp. will build two cars, the Kaiser and the Frazer.

The Kaiser. On details of this venture into the postwar consumer field, Kaiser was vague. The Kaiser would be a "large, yet lightweight car, startlingly different." But the final design has not been set. Neither has a plant been selected to make it nor dealers to sell it. But of one thing Kaiser was certain: the car will be built on the West Coast, will compete with the Ford and Chevrolet, presumably sell for about $1,000 (Kaiser has dropped the idea of making a jeep). With his usual enthusiasm, he promised: the Kaiser will be on the market early next year.

The Frazer. Detroit's automen smiled at this. Normally, it takes them 18 months to translate blueprints into a car. Nor were they worried by Kaiser's invasion of their bailiwick. Some of them already have their own West Coast assembly plants, all of them have a solid grip on the market. If Kaiser sells in the East, as he plans, he will be up against a $175 freight charge tacked to the price Of his car. Thus, old line automen may get their first competition not from the Kaiser but from the Frazer. Reason: the Frazer, which will sell for around $1,500, has already been partially designed; there is a plant available to build it, Graham-Paige in Detroit.

The presence of two of Floyd Odium's Atlas Corp. directors on the board of the Frazer-Kaiser Corp. started rumors that Atlas Corp., with its $13,000,000 in cash, was behind the new company. Odium denied it. Authorized capital will be 5,000,000 shares at $1 par. Half the stock will be taken by Graham-Paige for its stockholders. But all the rosy talk was enough to make Graham-Paige stock the most active stock on the New York Exchange last week, send it hippity-hopping up.

The Powerful Field. Last week, General Motors let out that it too is thinking about a new car, lighter, cheaper than Chevrolet. It plans to build a plant in Cleveland to produce it, possibly set up a new organization to market it. Nash Motors is also reportedly planning a new model with a wheelbase of only 86 inches (present Ford wheelbase: 114 inches). Willys-Overland also has a new small car up its sleeve. But no one was doing much talking--yet. Cracked one motorman with heavy irony: "We're not as far along as Kaiser and Frazer."

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