Albert Ballin

by Bernhard Huldermann

“May, 1904.

“Much though my time has been occupied by the Hungarian affair (the competition of the Cunard Line in Hungary), and great though the strain on my nerves has been on that account, I must say that much bigger claims are made on my time and on my nerves by the negotiations we are now carrying on with the Russian Government concerning the sale of some of our steamers. On Christmas Day I sent some representatives to Petrograd who were to approach the government in case it intended to acquire any merchant vessels for purposes of war. These gentlemen are still staying at Petrograd, where they have been all the time with the exception of a few weeks, and we have carried on some extremely difficult negotiations by cable which so far have led to the definite sale of the Fürst Bismarck and the Belgia. The Auguste Victoria, which is still in dock until the necessary repairs have been executed, has also been sold to Russia, and the prospects that the Columbia will follow suit are extremely good.

“The sales, of course, necessitate large alterations of the existing schedules, and they lead to a great deal of inconvenience. A particularly awkward situation has been brought about by the circumstance that the Fürst Bismarck has been chartered to the firm of Thos. Cook and Sons for an excursion from Marseilles, in which 500 members of a Sunday school are to take part, so that, in order to release her, it has become necessary for the Augusts Victoria to interrupt her usual trip to the Near East, and for the Columbia to take her place....

“Our big coal contract with the Russian Government has, in the meantime, been considerably added to. The execution of the contract, however, is causing me a great deal of anxiety, as the English press, notably The Times, is only too glad to make use of this circumstance as a pretext for rousing suspicions as to Germany’s neutrality. As our government is not taking up a very firm attitude, the effect of these articles, of course, is highly disagreeable. On Friday, September 23rd, I had an opportunity of discussing this matter with the Imperial Chancellor at Homburg. The Chancellor did not disguise the anxiety he felt concerning these contracts, especially as he had just then received a long telegram from the German Ambassador in Tokio advising him to proceed with much caution. I told the Chancellor that he need not study in any way the damage which our company might suffer; that we did not ask that any regard should be paid to our business interests in case these should clash with those of the country, and that, if the Government were of opinion that the interests of the country necessitated the cancelling of the whole agreement, I should be glad to receive instructions from him to that effect. Failing such instructions, of course, I was not entitled to cancel a contract which was in every respect a properly drawn-up legal instrument. At the same time I pointed out to the Chancellor that Germany, if he thought that he had reason to adopt such an attitude, would run the risk of offending both antagonists; for it was but reasonable to expect that, owing to the agitation carried on by the British, no action on Germany’s part would cause a change of feeling in Japan, but that it would be a fatal blow to Russia, whose Baltic fleet in that case would simply be unable to reach the Far East.

“From Frankfort I went to Berlin in order to discuss the question of the coal contract with the Foreign Office, which the Chancellor had requested me to do. I had a long conference with Richthofen....

“ ... October 1st, 1904. Meanwhile our negotiations with the Russian Government have made good progress, and practically the whole of my time is taken up with these transactions, which have given us a very exciting time. They compel me to go to Berlin pretty frequently, as I consider it both fair to the Foreign Office and advisable in our own interests that the former should always be fully informed of all the steps I am taking. Several of our gentlemen are constantly travelling from Hamburg to Petrograd, and conferences of our directors are held nearly every morning, necessitated by the telegrams which arrive from Petrograd practically every day. In order to be in a position to carry out the coal contracts, we have been obliged to charter a large number of steamers, so that at times as many as 80 of these are employed in this Russian transaction. Besides the old express steamers and the Belgia we have now sold to the Russians the Palatia and the Phœnicia, as well as nine other boats of our company, including the Belgravia, Assyria, and Granada (the remaining ones are cargo vessels, mostly taken out of the West Indies service), but as regards these latter, we have reserved to ourselves the right of redemption.... We have successfully accomplished the great task we had undertaken, although, owing to the absence of coaling stations, it was thought next to impossible to convey such a huge squadron as was the Baltic fleet all the way from European to Far Eastern waters. It safely reached its destination, because the previously arranged coaling of the vessels was carried out systematically and without a hitch anywhere, although in some cases it had to be done in open roadsteads. Its inglorious end in the Korea Straits cannot, and does not, diminish the magnitude of the achievement; and the experiences we have gained by successfully carrying out our novel task will surely prove of great value to the Government. This whole coaling business has been a source of considerable profits to our company, although if due regard is paid to the exceptional character of the work and to the unusual risks we had to run, they cannot be called exorbitant.”

A few statistics will show what the whole undertaking meant to the Hamburg-Amerika Linie from a business point of view. During the years 1904 and 1905 the company increased its fleet by no less than 21 steamers—partly new buildings and partly new purchases—representing a value of 22½ million marks. To these new acquisitions must be added the 19 steamers then building, of a value of 52 million marks, amongst them the two big passenger steamers Amerika and Kaiserin Auguste Victoria for the New York route, and other big boats for the Mexico, the River Plate, and the Far East services. A large fraction of the sums spent on this new tonnage—viz. no less than 24 million marks—represented the profits made on the sales of ships; another large portion was taken out of current earnings, and the remainder was secured by a debenture issue. Never again, except in 1913, has the company added such an amount of tonnage to its fleet in a single year as it did at that time. But the “re-birth” of the company did not only consist in this augmentation of tonnage, but also, and chiefly, in the entire reorganization of its New York service by the addition to its fleet of the Amerika and the Kaiserin Auguste Victoria. This event meant that the era of the express steamers was being succeeded by one characterized by another type of vessel which, though possessing less speed, was mainly designed with a view to securing the utmost possible comfort to the passengers. The two steamers proved exceedingly remunerative investments, and added enormously to the clientèle of the company. The profits earned on the Russian transaction also made up to a large extent for the losses incurred in the keen rate war with the Cunard Line then in progress. In spite of this rate war the company was able to increase its dividend to 9 per cent. in 1904, and to 11 per cent. in 1905.

Another event which took place in 1904 was the conclusion of a contract with the German Government concerning the troop transports to German South-West Africa, and the year 1905 witnessed the settlement of a short-lived conflict with the North German Lloyd. This conflict attracted a great deal of attention at the time, and the Kaiser himself thought fit to intervene with a view to terminating it.

When it was seen that German commercial interests in the Middle East had considerably increased, the Hamburg-Amerika Linie opened a special line to the Persian Gulf in 1906. The year 1907 is chiefly remarkable for a rate war affecting the services from Hamburg to the West Coast of Africa, of which until then the Woermann Line had considered itself entitled to claim a monopoly.

The African shipping business had been jealously nursed by its founder, Adolph Woermann, who had always tried hard to guard this special domain of his against the encroachments of all outsiders. However much Ballin and Adolph Woermann differed in character, they were akin to each other in one essential feature—viz. the jealous love they bore to the undertaking with which they had identified themselves. Both men, grown up in absolutely different environments, yet resembled each other in the daring and the fearlessness with which they defended the interests of their businesses. The one had trained himself to employ moderation and commonsense to overcome resistance where the use of forcible means promised no success; the other was a pioneer in the colonial sphere, a king in his African empire, the discoverer of new outlets, but broken in spirit and bereft of his strength when compelled by circumstances to share with others. When Adolph Woermann had died, Ballin honoured his memory by contributing to the public Press an appreciation of his character, which is perhaps the best that has been written, and which ought to be saved from being forgotten. This fact, it is hoped, will be sufficient justification for reproducing in this connexion a translation of Ballin’s article: