Foreign Relations of the United States: Diplomatic Papers, 1944, Europe, Volume IV

740.00112 European War 1939/10470: Telegram

The Ambassador in the United Kingdom (Winant) to the Secretary of State

London, April 3, 1944—8 p.m.
[Received April 4—4:40 a.m.]

2713. From the Ambassador and Riefler. Reference Department’s 1986, March 16 and Embassy’s 2460, March 26 and 2329, March 22.⁶¹

1. Waring⁶² has now arrived from Stockholm and we have examined the ball-bearing problem with him. We have seen Stockholm’s 1054, March 28 to the Department⁶³ and have taken the contents into account. There have also been further conferences between the Ambassador and General Spaatz⁶⁴ and between Foot, Hägglöf and Riefler. In view of the circumstances as we now see it the ball-bearing situation appears as follows:

2. No action should be taken to deprive us of the advantages we now enjoy which limit Swedish exports of ball bearings to enemy Europe during 1944 to around 29,000,000 kronor. Every effort should be made, however, to improve on these advantages to the maximum extent possible. Such additional advantages, rated in decreasing order of importance, would consist of (a) further decreases during 1944 in aggregate deliveries of bearings to Germany below the amounts set forth in the existing Swedish-German contract (b) cessation or reduction of immediate deliveries from Sweden to Germany during the next few months and postponement of deliveries of these deferred amounts to the latter part of the year, (c) impediments to the delivery of special types of bearings, such as bearings for airframe assemblies, (d) an even spacing of deliveries throughout the year to one-twelfth of the annual quota each month, and (e) restrictions imposed by the SKF company limiting German ability to shift orders once placed to types more immediately in demand as our bomber offensive progresses.

3. We have received Swedish Government assurances with respect to (d) and (e) above. We feel we can place considerable reliance upon (d) beginning with the second quarter of 1944, but we are less certain of the practical meaning of the assurance we have received under (e). Our uncertainty arises out of the difficulty of knowing how materially this assurance may hamper the enemy. We are exploring the subject further and are requesting details of orders placed by the Germans with SKF.

4. The Swedish Government has told us that they cannot go farther than this to meet our wishes, that they feel bound to live up to their agreement with the Germans which was concluded in strict accord with their prior agreement with us and that they are duty bound to try to see to it that SKF lives up to contracts made in accordance with its agreement. (Reference Embassy’s airgram A–402, April 1.⁶⁵) At the same time, Hägglöf has admitted that the Swedish Government has no legal means of forcing compliance upon SKF. He has also let us know that the Swedish Government is extremely anxious to receive Spitfires (although they are not prepared to break their agreement to obtain them), that SKF is anxious for further orders for ball bearings, and that a German trade delegation is due to return to Stockholm about the middle of this month. In view of the heavy pressure (including lavish offers of supplies) which the Germans have imposed in their attempts to get ball bearings during recent months, we feel that action must be initiated at once, prior to the arrival of the German delegation in Sweden, and that such action should be directed primarily at the SKF company. It should also include inducements, calculated to restrain the Swedish Government as far as possible to “formal” position in carrying out their commitments to the Germans. We propose, in consequence, the program outlined below. While it does not attempt to obtain our objective under (a) above, i.e., an absolute decrease in total bearing deliveries during 1944 below the contract limits, we think it has a chance of obtaining our objective under (b), i.e., the deferring of deliveries to latter half of 1944.

5. (a) Should the SKF company fall in with our plans, the British Government will arrange to begin to deliver Spitfires to the Swedish Government. It will be understood that these deliveries will stop should the Swedish Government adopt more than a “formal” position in carrying out its commitments, vis-à-vis, ball bearings to the Germans.

(b) As the SKF company appears to place considerable importance on its prospects of trade with Russia, both in the immediate future should Finland withdraw from the war, as well as during the post war period, the British are asking the Russian Government to indicate to the Swedish Government and to SKF in no uncertain terms that Russia’s attitude with respect to future business relations with SKF will be conditioned on the extent to which SKF meets our wishes with respect to its current deliveries to Germany. We recommend that the Department act immediately on parallel lines.

(c) MEW, with our concurrence, has directed Mallet, on an informal and personal basis (keeping Johnson informed), to contact Marc Wallenberg⁶⁶ to sound out the SKF company as follows: (1) we may be prepared to place large orders with SKF for 1944 and 1945 delivery to us providing that SKF makes no contract with enemy Europe for 1945 and ceases current deliveries of all bearings to Germany for a period of 3 months; (2) we might be prepared to place smaller orders if SKF cannot eliminate current deliveries but is able to cut them by, say, 50%. The SKF company would not be asked to break its contract with Germany but merely to defer deliveries under that contract until late in the year. It would also be asked to indicate what could be done to impede German access to special types of bearings such as air frame bearings. (Wallenberg would be informed that we place great importance on the attitude of SKF toward these proposals, that we feel the company by increasing its capacity to manufacture small bearings has deprived us of part, at least, of the advantage that should have accrued from the preemptive orders which the British placed last year, that the United Nations will be in a position to influence a great portion of Europe’s business after the war and that company may well find itself in difficulties if it does not conform to our present request.)

6. Marc Wallenberg appears the best initial contact for this move. We understand that his bank holds a considerable volume of shares of SKF, that his brother Jakob is on the SKF board, that he is personally strongly pro-United Nations, and that he enjoys intimate contacts with the Swedish Government.

7. We feel that speed is essential and desire the Department’s comments, including (if it concurs) authorization to go ahead, as soon as possible. Should the informal response from Wallenberg indicate that the above approach is feasible we would like funds in hand to strike a bargain. Because of the fact that the British are providing the Spitfires and that they also provided the funds for the preemptive program last year (2,000,000 pounds in all, although some of the purchases had a supply aspect), we recommend that American funds be used for the contracts outlined above. Generals Spaatz and MacDonald⁶⁷ join us in recommending that at least $20,000,000 be made available for this purpose as soon as possible. [Winant and Riefler.]

Winant

61. Telegrams 2460 and 2329 not printed.
62. William Waring, of the British Supply Ministry.
63. Not printed.
64. Gen. Carl Spaatz, Commanding General, United States Strategic Air Forces in European Theater of Operations.
65. Not printed.
66. Marcus Wallenberg, Vice-Managing Director of Stockholms Enskilda Bank.
67. Gen. George C. MacDonald, Director of Intelligence of United States Strategic Air Forces in Europe.