FOREIGN TRADE: High Tension

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At first, it was a simple business deal. Seattle's municipal power system needed six transformers and the city had asked for bids. When the bids were opened on Dec. 16, Britain's Ferranti, Ltd. was low with $571,632. But it had failed to meet specifications, so Seattle threw out the bid—and was shocked to find itself at the center of some international high tension.

British businessmen would not believe —or did not know—that the bid had been rejected on technical grounds. City Purchasing Agent Paul R. Hendricks explained that the British firm had not met the city's engineering and delivery requirements; it could not furnish blueprints for twelve months instead of the 120 days specified. Furthermore, Seattle was not sure about other details. Ferranti had written its contract in the technical jargon of the British Institution of Electrical Engineers, had merely appended a glossary of I.E.E. terms, leaving Seattle to try to figure out the specifics of the bid for itself.

Last week Seattle awarded the transformer contract to General Electric Co. At $751,000, G.E.'s bid was higher than Ferranti's as well as the bids of another British firm, which had also failed to meet specifications, and one U.S. firm. G.E. won out, said Hendricks, because Seattle thought it would do the best job.

But European newspapers played up the Ferranti story as a prime object lesson to "prove" that the U.S. was not practicing what it preached. Biggest complaints came from continental businessmen who have resented ECA's constant pressure for freer trade and from Britons who have persistently ignored the requirements of the U.S. market. They complained that Americans were not permitting free competition in the U.S. by Europeans. Sir Cecil Weir, chairman of the British Dollar Export Board, even hustled over to ECA's Washington office to protest that Seattle had discriminated against Ferranti.

At week's end, after an investigation, ECA concluded that all such charges were eyewash. Said ECA: "The British didn't meet the specifications, that's all."