[David_Hayward (RIP)]

The Exchange Requirements Committee had been set up in September 1939 to regulate the outflow of British currency reserves.

Let's then pick up the story!

...The Ministry of Supply was beholden to the ERC for approval of any foreign acquisitions including for forces overseas and that included both Canadian and US. [‘North American’] purchases. The attitude expressed by the Minister of Supply can only have inflamed Ottawa when a short time later it appeared that the British government had interfered and reneged on a large contract for vehicles in favour of Ford of Britain . In January 1940 the Canadian Minister of Finance complained bitterly through the High Commissioner in London to the Secretary of State for the Dominions, Anthony Eden, and the Chancellor of the Exchequer that a Ford of Canada order for 2,300 trucks to be supplied through Ford in Bombay had been curtailed [although in fact halved], because of lack of Canadian dollar exchange. To make matters worse Ford at Dagenham had been contracted to provide the vehicles, thus resulting in aggravation of the India-Canada imbalance of trade, and an adverse effect on Ford of Canada. One Civil Servant succinctly announced ‘I am afraid that it is the diversion of the balance of the orders to the Ford Company in England which is the real source of irritation in this case’ . The response also summed up the situation perfectly:

This is an awkward business. There is already a long history, since the outbreak of war, of sensitiveness on Canada’s part and of friction with her in regard to reductions in Canadian exports to this country which have been necessitated by war conditions; and she has argued that her war effort must be adversely affected by interference with her internal economy.

After much discussion at high level the Duke of Devonshire and the Chancellor wrote to explain that the vehicles were for the mechanisation of the army in India, part of a pre-war process, and the British ‘taxpayers’ were footing the bill [NOTE THIS SLOTS IN WITH THE REFERENCES IN PAGE 2]. Although a proportion of the requirement had been placed with Canada, the rest was intended to obviate the need for redundancies in Dagenham. It was acknowledged though that the matter could have been dealt with more sensitively; this was regrettably indicative of the concerns over dollar exchange that resulted in the blinkered belief in domestic production being able to satisfy requirements, lack of appreciation of continuing Canadian economic assistance to the UK and the need to keep the Canadian industries rolling with consecutive orders in addition to Canada’s own.

Large numbers of Canadian Fords were indeed procured by the British for delivery to Bombay but this was then rescinded possibly because the Indian Army had brought to Egypt a quantity of Chevrolets [1940 Models at least] which then became the responsibility of the WD. That in turn meant the ERC had to agree to a Ministry of Supply request for dollars to purchase spare parts for them from GM Near East and also RAOC, RASC and other units that were using Chevrolet trucks as well. Payment in Egyptian Pounds in Egypt required immediate purchase of [US] dollars by Near East and therefore technically this required dollar exchange consent. The reason for this is that all transactions between GM subsidiaries had to be made in dollars through New York, and that required dollar purchases. [FORD DID THE SAME, POSSIBLY THROUGH DEARBORN ALTHOUGH THEY MAY HAVE HAD A NYC OFFICE]. Apart from the £10,000 for the spares for the latter’s vehicles, a running contract of expenditure up to £14,000 per year was agreed to with ‘GM Limited’ {sic.) as required by the Army in Egypt. The sum was agreed by the ERC. because there was no hope of supplying small quantities of spare parts for these vehicles with ‘any degree of efficiency’.

However by August 1940 and with the entry of the Italians into the war, the Mediterranean was closed to US. shipping; GM Near East could no longer obtain supplies and GM. required purchases for the Army to be made through the British Purchasing Commission in New York. Impressments increased the number of Chevrolets being used, and $137,000-worth of spare parts covering 5 months’ requirements was purchased from local agents. Further purchases of spares were required and $130,000 was requested to be authorised to purchase 8 months’ worth of stock, at say $16,000 per month, or $200,000 per year. ERC consent was then requested for the immediate purchase of spares to $130,000 and for purchases to cover monthly demands for spare parts.

I hope that gives you some idea how much more money these trucks cost to run once they arrived.