Germany and Oil

Discussions on the economic history of the nations taking part in WW2, from the recovery after the depression until the economy at war.
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Lars
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Post by Lars » 22 Aug 2007 09:02

Actually the limiting factor was more labour according to Wages of Destruction. Lack of manpower, led to not enough coal, lead to not enough steel production and not enough goods to sell abroard - just to mention one cycle (man power --> coal --> steel).

It is also evident form the Wages of Destgruction that the Nazis set out with one big self inflicted wound in 1933/1934. They raised the wages in agriculture artificially which benefitted the farmers but led to less that optimal labour allocation use of the German economy. This meant that workers who would otherwise have migrated to the cities stayed on unproductive farms.

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Post by Bronsky » 22 Aug 2007 09:41

It's not easy to point the finger at the biggest self-inflicted wound. From the point of view of economics, rearmament is a huge self-inflicting wound, sucking in productive resources and turning out unproductive assets (which usually end up as twisted scraps of metal, adding insult to injury).

Given how rearmament was decided upon, and therefore the autarky policy, it's not entirely certain that the Nazi agricultural policy was that bad. After all, the country had a severe food problem and relying on imports wasn't a reliable option. Unproductive farmers at least fed themselves and turned out a small surplus of a valuable commodity (valuable only in the context of rearmament & war economy of course).

That's not to say that the policy was sound or couldn't have been improved upon: the British wartime agricultural policy is a good example of what could be done; on the other hand there was far more slack in the prewar British agriculture.

If we look at the resources involved in producing synthetic fuel, we have construction workers, scientific expertize, a lot of miners who are digging up coal that will be used in the oxygenation plants at a very wasteful rate, the personnel of the plants themselves, and of course transportation of both commodities. Mining coal doesn't require significant resources being transported to the mines, whereas synthetic oil required a lot of coal being transported to the plants. That means yet more coal, transportation and manpower wasted.

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Post by phylo_roadking » 22 Aug 2007 19:09

on the other hand there was far more slack in the prewar British agriculture


Slack in the sense that not all possible land could be cultivated; a third more land was brough under cultivation 1939-45, but it was "marginal" land", and in many parts of the UK was let lapse back into rough grazing shorty after the war. This process is actually stepping up now, with the EU money available for "set-aside" land - a lot of farmers with this marginal land - thin soil, steep hillsides, bad drainage - are being paid to take it out of cultivation again rather than have to be given support and subsidies to use it!.

However, a lot of the older generation will equally remember the grey. stodgy, non-rising concrete that was bread made from British-grown wheat! Before the war, the land under cultivation was raising crops and livestock far more suitable for them in the main that a lot of what various government ministries directed should be grown during the war to fill gaps normally covered by imports. The government also paid farmers to bring this extra land under cultivation, via the Land Purchase Annuity scheme; they gave long-duration loans at ridiculously low interest for farmers to buy up marginal land and cultivate it. Before this, farmers simply couldn't afford to do so. Also, only mechanisation in agriculture alowed the extra land to be brought under the plough, especially during wartime; the sheer manpower wouldn't have been available, British agriculture in 1939 was still 65% horse and steam powered! So it could be argued that while there was slack in some directions, in others British agriculture was right up against its limits.

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Post by Jon G. » 22 Aug 2007 20:42

Britain was only about 25% self-sustainable in food as opposed to Germany's ~84% so already going by the numbers alone there was more slack to pick up in British agriculture. Managing the remaining 75% was essentially a different problem, connected to the German U-Boat blockade and the battle of the Atlantic. Britain couldn't realistically attain 100% food autarchy, but the dependence on overseas imports could be reduced by rationing, convoying and meticulous management of shipping space - IIRC from 22.5 million tons of GRT needed for food imports in 1939 to just 6 million tons needed in 1943.

Marginal land is fine for pastoral agriculture, but raising animal products is irrational from a rationing perspective, so most countries (also Germany) encouraged switching to grain growing - it's when you try to convert poor soils into grain fields that problems sometimes arise.

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Post by Paul Lakowski » 27 Aug 2007 21:48

If you read Diest its clear that Von Blomberg as CinC , through Liese tried to initiate mass production of armaments in 1934 in anticipation of the wide breadth need of arms for each service branch. The coordinated approach would have featured multi year fixed price contracts for armaments where the burden of economy was forced on to the industry. They would have found the cuts in manhours economy of resources and therefor cost needed to make the profit. This as Tooze points out in his subsquent articles, is how the germans mobilized their economy when push came to shove during the war.

While its true to say Armaments spending became the entire focus of Hitlers spending programes from the mid 1930s on, its not accurate to call this a war economy, certainly not in the same sense as was being fashioned in the UK/USSR./USA at that time. Their military industrial capacity was increasing in leaps and bounds even if annual peace time production was not. They already had multi year fixed price contracting and set up shadow companies to be initiated during war time, while Stalin reportedly had numerous hugh civilian factories built that had deliberate alternative war time functions. When needed hugh leaps in production were possible.

But Hitler was against mass production from the start and thus forgo any real chance of a war economy until he finial learned how to deligate power out of nessecity during the war. Had Hitler empowered his CinC [VonBlomberg] from the start instead of playing all services off against each other and guarding his power base through paranoia, German could have easily doubled out put in the last half of the 1930s, leading to a further doubling/tripling of production within one year of the war starting.

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Post by Bronsky » 28 Aug 2007 10:43

phylo_roadking wrote:Slack in the sense that not all possible land could be cultivated; a third more land was brough under cultivation 1939-45, but it was "marginal" land", and in many parts of the UK was let lapse back into rough grazing shorty after the war.


Well, whenever one refers to slack in an economy, the same thing applies. There was slack in the oil production sector in that only the most profitable sources were being used prewar, with some "marginal" sources left largely untapped.

However, when the most productive sources became out of reach or maxed out, the Germans had to turn to the marginal one. Still, output increased. That is slack.

The same holds true of other economic sectors usually referred to as including fair amounts of slack e.g. the prewar US heavy industry, or the parts of the German economy converted to direct armament production after 1942.

phylo_roadking wrote:However, a lot of the older generation will equally remember the grey. stodgy, non-rising concrete that was bread made from British-grown wheat! Before the war, the land under cultivation was raising crops and livestock far more suitable for them in the main that a lot of what various government ministries directed should be grown during the war to fill gaps normally covered by imports. The government also paid farmers to bring this extra land under cultivation, via the Land Purchase Annuity scheme; they gave long-duration loans at ridiculously low interest for farmers to buy up marginal land and cultivate it. Before this, farmers simply couldn't afford to do so. Also, only mechanisation in agriculture alowed the extra land to be brought under the plough, especially during wartime; the sheer manpower wouldn't have been available, British agriculture in 1939 was still 65% horse and steam powered! So it could be argued that while there was slack in some directions, in others British agriculture was right up against its limits.


Total arable area went from 12,906,000 to 19,273,000 acres between 1939 and 1944 and output also increased despite a reduction of the regular male labor force by 5%.

From Milward, "War, Economy and Society" p.249: The averege pre-war diet in Britain derived about 37 per cent of its energy from livestock products, at the end of the war only 30 per cent. This represented a savig of as much as 20 per cent of the acreage needed to provide the civilian diet. ... The use of the equivalent land unit for human rather than animal food therefore produces an enormous economy in land at the expense of a change of diet. Economies in land use can also be effected by changing the pattern of crops. The calorific yield of potatoes, for example, is over twice that of wheat. But livestock can have advantages in the variety of food which they produce. Furthermore some cattloe and many sheep graze on land which cannot be tilled. The problem of maximizing the calorific output of the available land was therefore a complex one involving adjustements in the balance of crops as well as conversion from livestock to arable farming..
Land was, of course, not always the scarcest factor. In the economies of some of the major combatants labour was at least as scarce. Where labour was the scarce factor the comparative advantages of various crops were different. For instance in the United Kingdom wheat provided two and a half times more food value per man hour of labour than potatoes. Dairy cows required roughly five times the amount of labour that pigs requires to produce a comparable food value. A case coule be made out for the argument that for the United Kingdom the scarcest factopr was the available shipping space for imports, and that the maximum economy in the cubic capacity of the necessary imports was the major influence on the balance and pattern of domestic agricultural production. Although sugar beet, for example, gave an even higher calorific yield per acre than potatoes, to do so it required five times the volume of fertilizer that a grain crop grown for fodder required. One thousand cubic feet of shipping space devoted to sugar would have yielded 83,000 calories, to fats over 100,000 calories, to wheat 56,000 calories and to eggs in shell only 12,000 calories.
"

As a result, the pig population was cut by 50% and chickens by 33%, while dairy cows increased (though due to declining yields, milk production actually declined during the first three years of the war). I assume that sheep remained pretty much the same, requiring neither much in the way of manpower nor competing for fertile land. On the other hand, that one must have been pretty near maxing out anyway, so no slack there.

As a result (Milward, p.253): "The total net output of calories from British agriculture rose from 14,700 million in 1938-39 to 28,100 million in 1943-44. If the calculation is made on a gross rather than a net basis the success is perhaps more striking, because about 4,000 million of the annual pre-war calories depended on imported feeding stuffs, seeds and livestock whereas in 1943-4 only 1,000 million did."

Jon G. wrote:22.5 million tons of GRT needed for food imports in 1939 to just 6 million tons needed in 1943.


Note that some of that reduction came from the switch away from raw to processed foodstuffs in British imports. These were more expensive in monetary terms, but took up less shipping space e.g. for a given calorie value canned meat is remarkably compact but more expensive than shipping fodder for British cattle. That particular switch was only possible after lend-lease made imports of US processed food affordable. I remember reading estimates for how much shipping was saved in that way, but forget where at the moment so tracking the source down would be too time-consuming.
Last edited by Bronsky on 28 Aug 2007 10:53, edited 1 time in total.

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Post by Bronsky » 28 Aug 2007 10:52

Paul Lakowski wrote:While its true to say Armaments spending became the entire focus of Hitlers spending programes from the mid 1930s on, its not accurate to call this a war economy, certainly not in the same sense as was being fashioned in the UK/USSR./USA at that time. Their military industrial capacity was increasing in leaps and bounds even if annual peace time production was not. They already had multi year fixed price contracting and set up shadow companies to be initiated during war time, while Stalin reportedly had numerous hugh civilian factories built that had deliberate alternative war time functions. When needed hugh leaps in production were possible.


That's an interesting take. Where do you draw the line between war economy and no war economy?

The US didn't have shadow factories, what happened was that after mid-1940 the US government directly paid for (in various guises) the infrastructure required to expand production in addition to ordering large amounts of equipment.
The British had shadow factories for the air force, but spread their tank orders around on a more or less ad hoc basis AFAIK. So I'm not sure that hard and fast rule can be identified here.

Regarding pricing, the British rearmament was largely conducted, at least until 1939, by letting the manufacturers fix their price. More complex systems were only introduced after 1939, and the US also only went that route by late 1940, helped by British & French experience.

So I'm curious what constitutes a true war economy in your eyes.

Paul Lakowski wrote:But Hitler was against mass production from the start and thus forgo any real chance of a war economy until he finial learned how to deligate power out of nessecity during the war. Had Hitler empowered his CinC [VonBlomberg] from the start instead of playing all services off against each other and guarding his power base through paranoia, German could have easily doubled out put in the last half of the 1930s, leading to a further doubling/tripling of production within one year of the war starting.


It seems to me that some production could have been increased, at the cost of something else e.g. cutting the Kriegsmarine steel allocation on the basis that Plan Z was a waste of materials would have released the necessary resources to produce more tanks. So the problem would be strategic priorities rather than the organization of the war effort per se. The Allies wasted huge amounts of resources that way as well, only the Soviets out-specialized everyone else.

Also, a lot of German resources were still tied into infrastructure investment in the early war, like building additional factory floor space or making it possible to use low-ore content German iron mines. Some of these were instrumental in making the later production increase possible (i.e. when the extra factories came on line), others turned out to be largely a waste of resources (like the iron mines) but 1/ it couldn't have been anticipated and 2/ that wasn't a procurement problem as opposed to spending resources in pursuit of a strategic deadend.

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Post by Paul Lakowski » 28 Aug 2007 22:17

So I'm curious what constitutes a true war economy in your eyes.


Multi year contracts based on agreed upon prices controlled by a central governing body/committie, which is what Liese through Blomberg was driving at in 1934.This could be followed up by 'licence production' to spread the work load over the industry . The Luftwaffe was doing this for some programmes in 1935.


Lutz Budraß , Jonas Scherner , Jochen Streb "Demystifying the German “armament miracle” during World War II.
New insights from the annual audits of German aircraft producers."

http://www.ata.boun.edu.tr/ehes/Istanbu ... _Jun05.pdf.

Under Hitler the move to fixed priced multi year contracts didn't surface until mid 1941 for most services, but 1937 for the Luftwaffe. All those multitude of armaments programmes with very low production runs probably doubled the cost of armaments production over all through out this period.

As for resources its accurate to say that Nazi wasted hugh amount of labor resources and funding on political projects like Autobahn and party buildings etc, but in addition most armaments projects allocated resources in an inefficent manner. According to Overy each plane contract awarded allocated 16,000 lb of aluminum per plane no matter if it was a fighter with frame of 2000-4000lb or a bomber with an airframe of 8,000-12,000 lb. The companies were not made accountable for this and channeled the excess resources into products for the civilian market place.

Before Speer got in power, roughly only 1 ton out of every 10 tons steel allocated resulted in armaments, while after a couple of years of waste reduction drives, this ratio was lifted to 4 tons armaments for every 10 tons steel allocated. With out an overseeing body/committie to govern control of resources funding etc this is the kind of wastefull missmanagement that can occure. The above mentioned article seems to point the finger squarely at the lack of industrial incentives built into the contracts, which is a political decision.

Doubling KM is easily acheived by redirecting the ship building strategy from a long term build into a short term priorty programme. In the historical build programme , roughly 1/2 the ships built through the mid to late 1930s were support ships not essential strategic combat role of fighting the UK. This is important since the bulk of those support ships could have been 'adquately' filled by overhauling/modernising 'obsolete' warships and converting civilian vessels to fill such support roles. If the KM were following the plan that war would not occure unitil the mid 1940s, then this is un likely to occure, but if the strategy had always been how to defeat the UK from the start with possible war breaking out as early as 1940, then the historcial build program becomes lavish waste of resources.

Hitler kept the cards and the reigns of power close to his chest , which crippled Germanys chances almost as soon as the war began.

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Post by Bronsky » 29 Aug 2007 08:38

Thanks for the insight. I was aware of the article you mentioned. Some points:

Paul Lakowski wrote:
So I'm curious what constitutes a true war economy in your eyes.


Multi year contracts based on agreed upon prices controlled by a central governing body/committie, which is what Liese through Blomberg was driving at in 1934.This could be followed up by 'licence production' to spread the work load over the industry . The Luftwaffe was doing this for some programmes in 1935.


There is no magic solution.
Fixed prices, if low, can either encourage the industry to go large so as to reap the benefits of economies of scale, or it can discourage it from further investment. If high, fixed prices will encourage initial investment and therefore output, at the cost of discouraging productivity gains later. That is what happened with the aluminium allocation.

'Variable' prices are either terribly wasteful of public funds (that was the WWI experience) or, if based on a 'cost plus' formula, discouraging economies of scale.

Eventually, the Allies used a fixed price system subject to periodic revisions so as to force economies of scale.

'Market' prices i.e. relatively small series and letting the supplier fix its own price (within certain limits) is how the British Army and the Wehrmacht procured tanks. So if Germany wasn't a war economy (according to you), can the same accusation be levelled at Britain?

Paul Lakowski wrote:Under Hitler the move to fixed priced multi year contracts didn't surface until mid 1941 for most services, but 1937 for the Luftwaffe.


Hm, shipbuilding would be an obvious exception given the lead times involved and the long term sub program, ditto with artillery AFAIK. Many other areas of weapons procurement weren't susceptible to multi year contracts due to the rapidly changing strategic situation, leading to changes in the balance between ammunition and equipment.
Germany built a ton of ammunition prior to the 1940 campaign, then it found it had too many and cut back, only to find itself short a couple of months into Barbarossa.

I'm not sure that this is not being a war economy, as opposed to faulty planning. For a comparison, the US usually earns the war economy badge, yet look up how the initial amphibious shipping building program took a hit when a crash DE building program was substituted in mid-42. As a result, a lot of resources were wasted (though the US could afford that far better than Germany) and the Allies had a ton of ASW escorts but were crying for more LSTs in mid-'44.

Examples like that can be found in every country, the question would be whether Germany was particularly inefficient compared to the other belligerents, and how much that was due to its particular posture. Besides the United States, Germany was after all the only power to build the whole range of military equipment, it could never specialize. It had to build surface warships (though that one took a big hit), aircraft, artillery, tanks, rifles, ammunition, etc. The Soviet Union specialized on aircraft and ground forces weapons, abandoned naval construction and 'outsourced' (through lend-lease) production of a lot of raw materials as well as most of the support stuff (radios, medicine, transportation, etc). Britain 'outsourced' much of its tank & vehicle production (over half the tanks used by British forces in Europe after D-Day were lend-lease), let the RN slip behind as a blue water navy, and even in aircraft procurement whole branches (e.g. transport aircraft) were abandoned to lend-lease.

These factors also have to be taken into account IMO.

Paul Lakowski wrote: All those multitude of armaments programmes with very low production runs probably doubled the cost of armaments production over all through out this period.


So just to understand your point correctly, you consider a highly-mobilized but poorly-managed economy not to be a war economy, as opposed to a less-mobilized but better-managed one?

Paul Lakowski wrote:As for resources its accurate to say that Nazi wasted hugh amount of labor resources and funding on political projects like Autobahn and party buildings etc, but in addition most armaments projects allocated resources in an inefficent manner.


IIRC from what Overy writes the autobahn program didn't compete with armament because at the time when the large construction projects took place the German armament industry wasn't able to pick up additional orders anyway, it was still too small.

Later on, one can argue that Organisation Todt wasn't effective enough (the same criticism has been levelled at Beatherbrook's Ministry of Aircraft Production in the Battle of Britain) but there is little question that it was working for the war effort.

Paul Lakowski wrote:Before Speer got in power, roughly only 1 ton out of every 10 tons steel allocated resulted in armaments, while after a couple of years of waste reduction drives, this ratio was lifted to 4 tons armaments for every 10 tons steel allocated.


Tooze makes just the opposite point, and notes the strong corellation between steel allocation and armament output. His thesis is that Speer's alleged productivity gains mask increased steel allocations from other sources. He is well-aware of Overy's thesis, and I suppose that as a relatively young author he didn't want to have his masterpiece branded a polemical work which is what would have happened had he directly picked up a fight with Overy. Nevertheless, it would have been nice to see that point further elaborated upon. Maybe it will be in the future.

My own impression is that Speer did speed things up, though not as much as he claims, and a lot of the improvements that took place under his watch would have happened anyway as the normal result of processes initiated before him e.g. big infrastructure projects coming to an end, additional industrial capacity coming on line, etc.

Paul Lakowski wrote: With out an overseeing body/committie to govern control of resources funding etc this is the kind of wastefull missmanagement that can occure. The above mentioned article seems to point the finger squarely at the lack of industrial incentives built into the contracts, which is a political decision.


I'm not going to argue your definition of war economy, my previous (and above) questions are just to make clear that I understood your point correctly. I obviously disagree with your definition as I currently understand it, because among other things the whole WWI war effort largely becomes a non-war economy. But that would be off topic.

For now, all I will note is that the important political decision as far as a war economy is concerned is to be or not to be a war economy, i.e. how much resources will be devoted to war. In that respect, Germany scores very highly. But that's just my opinion, others may disagree.

Paul Lakowski wrote:Doubling KM is easily acheived by redirecting the ship building strategy from a long term build into a short term priorty programme.


I'm not sure that will be enough, as the Germans were critically short of key facilities required to expand warship construction. So it wasn't just a case of too many resources being tied up in support vessels as opposed to bottlenecks in warship construction, namely shortage of key specialists like welders and project managers for 'high-tech' stuff, radio, high-grade steel and other non ferrous ores, etc. These resources were mostly not needed for the support fleet.

Also, it seems to me that support ships are less expensive on a per unit basis than warships, so even if half the ships built were support as opposed to combat ships (which I don't know, do you have a breakdown? Maybe post this in a specific thread?), that wouldn't necessarily provide the funds to build that many more warships. This is just guessing, I could be wrong on that point, the point that I am confident about is the key resources shortage in the above paragraph.

Paul Lakowski wrote:Hitler kept the cards and the reigns of power close to his chest , which crippled Germanys chances almost as soon as the war began.


Quite frankly, Germany's chances were always crippled, as a quick look at the raw demographic and economic data indicates. Germany wasn't a great power, and it simply had no chance once it started taking on the world's three largest economies i.e. USA, USSR and Britain + Commonwealth. That point has been made for a long time.

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Post by Paul Lakowski » 30 Aug 2007 04:16

I have problems with Tooze work, as in this article.

http://www.hist.cam.ac.uk/academic_staf ... -reich.pdf

In the accompaigning exl file he disolves various armaments catagours into units that can be indext to gauge net armament production by tonnage. The process is far too abstract to be reliable and trusted. It needs details to flush it out. For example in warship building he groups Destroyers ;Torpedoboote ;Minesweepers; Vboot & landing craft all into one catagoury , while Sboot; Rboot and KFK in another. This makes no sence. Destroyers and Torpedoboot were very fast expensive 1800-3600 ton warships with advanced radar and ASDIC plus expensive high pressure propulsion systems, while Mboot/VBoot were cheaper slow moving ~800 tons warships using coal fired triple expansion engines , while the ultra slow 200 ton landing craft had small 390 hp diesel engines!

Since the KFK/RBoot/SBoot all used diesel engines and were 100-200 tons, grouping the Landing craft into that catagour, makes much more sence. But including the Vboot is retarded. They were not built, but converted from captured vessels and 500 were converted with maybe a couple dozen new built as U-Jaggers. No were near as involved as building new warships of similar size. Depending on the conversion and base shipping conversion of older ships can take 1/3 to 1/6 to as much as 1/12 of the effort manhours that go into new warship construction and often only a small amount of resources. How this is integrated in his articles is vague and unclear.

In the period indicated Last Quarter of 1939 to last quarter of 1944, we have
15 Destroyers @ 3700 tons
21 x torpedoboote 1935/37 @ 1050 tons each
15x Torpedoboote 1939 @ 1750 tons
48 x Mineboot 1935 built @ 870 tons each
131 x Mineboot 1940 built @ 775 tons each
17 x mineboot 1943 built @ 820 tons each
20 x 830 ton Vboot built & > 550 converted @ ~600-800t.
1000 x AFP @ 200-300 tons
total roughly 965,200 tons. However this assumes the Vboot are new construction , which they are not.

If the converted Vboot are treated as 1/3 new production thats 670,400 tons
If the converted Vboot are treated as 1/6 new production thats 598,500 tons
If the converted Vboot are treated as 1/12 new production thats 561,900 tons

Tooze figure is 354,900 tons based on 24 quarters or 1.065 million tons total, clearly his calculation is off. How many other mistakes are embedded in his calculations. Its all calculation based on his formula.

Re some other points .

All support ships were built to the same standards as major warships with same propulsion systems and armaments and in many cases the same sensors. Costs were similar too. I include Rboot/Sboot [75 @ 60-150 tons]Minesweepers[25 @ 880 tons], Fleet tankers [5 @ 22,000 tons] , Fleet tenders [6-7 @ 3000-5600 tons] and training ships [3-4 @ 1800-10,000 tons]. Its more a question of ship yard availablity resources and labor to build warships. Attention has to be paid to total naval construction tonnage and total engine power out put & Armaments totals, as this is a better indicator of what is possible.

Special attention has to be paid if armored ships are involved like crusiers aircraft carriers or battleships ,since the armor tonnage available is very limited. Big gun industry however has more flexabilty [IE industrial effort devoted to naval gun construction is very similar to coastal gun battery construction and is only deviated alittle from railway gun construction etc].

If you look at costing, the 21 Torpedoboot 1935-37 varied in price from 7-9 million RM a piece for a 1000 ton warship with a single 4" gun and 1/2 dozen torps and 1/2 dozen light flak. These where built through the late 1930s and early 1940s. When the much larger Torpedoboote 1939 followed in production, its price was only 5.7 million RM a piece for each of 15 built through 1944. This warship was much bigger and better @1750 tons armed with 4 x 4" guns 1/2 dozen torps and 1/2 dozen to dozen light flak. The first was built through 'cost plus' financing while the other was built in 'fixed price' contracts.

The Shifting priorities in ammo production etc were a direct result of Hitlers terrible mircomanagment of the socalled war economy. Beridice Carrol points out in "Designed for Total War" , that between early 1939 and mid 1940 , Hitler demanded the top priority in armament production changed 8 times , leaving the poor industrialist at the point of rebellion cause no sooner had they replanned for one priority when they had to replan for another. Overy has a good example of a bomber wing plant that wasted 300,000 man hours constantly retooling from one project to another and then to another and another etc and getting little produced in the mean time.

The reason ammo had to be boosted so badly is because Hitler Skrewed the german army when he expanded it in the late 1930s, scuttling the efforts to build up from an ammunition inventory of matter of weeks to months, as had been planned from the early 1930s. But throwing out the strategic plan and expanding the army from 75 divisions to 103 divisions, before the war, also force the Heer to dilute its armaments/ammo inventory instead of transforming those divisions into stronger motorized divisions as the original plan called for.

Once the Wehrmacht found itself in a shooting war, that Hitler assured them they would never be, they demanded the ammo production needed to procecute a war as opposed to rearmament program. A prewar plan had been agreed upon [Production Pan Wehrmacht] that prioritized armaments if war emerged at a given time and it was based on what was deficent at that time and what was most producable. So many weapons had to be cancelled in order for the Wehrmacht to build the basic armaments/ammo they needed most....which were supposed to be part of the overall rearmament programme.

Clearly we will just have to agree to disagree on this topic.

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Post by cummings » 30 Jan 2008 16:28

I would like to know the German Oil production figures for 1945.- Does anyone have any available data?

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Post by Jon G. » 04 Feb 2008 14:03

I haven't seen any reliable figures for 1945 German oil production. Most tables and summaries etc. I've seen contend themselves with a 'data incomplete' or 'NA' entry for 1945.

German oil production in 1945 was definitely small, although not non-existent. By that time, the synthfuel industry was in ruins, and most external oil sources (not just Romania, but also eg. Poland) had been captured by Germany's enemies. One of the last oil sources outside of the Reich was the Hungarian oil wells near the Balaton lake. Apparently Hungarian oil had chemical properties which made it particularly useful for aviation gasoline. Operation Frühlungserwachen in March 1945 was launced in part to protect the Balaton oil fields from the advancing Red Army.

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Re: Germany and Oil

Post by tramonte » 14 Jun 2018 15:28

"However successful synthetic oil may have been at granting Germany some degree of petroleum independence, the technology did not come cheap. Capital and construction costs for the average F-T plant were on average RM 30 million. Production costs for synthetic oil and refined fuel products were also exponentially higher than that for natural crude.The average manufacturing cost for a barrel of synthetic oil was between RM 32-45 ($13-18) and processed fuel values averaged 23-26 pfennig per kg (approximately 31-44 cents per gallon). In comparison, a barrel of crude oil traded for 93 cents on the U.S. commodities exchange in December 1939 and in the same month a gallon of regular gasoline sold for 13.4cents at the average New York City service station.

Early funding for synthetic development was primarily derived from capital investment by the companies themselves or from private investors and banks. However, by 1939 the costs of production grew untenable for private industry and the German government began absorbing more and more of the cost. A report in March 1939 stated that of the RM 132 million ($328.6 million) already spent on synthetic fuel that year, the government contributed an estimated RM70 million ($174.3 million) in the form of manufacturing equipment purchases. The high cost of production did little to hamper Germany’s continued investment and reliance on the synthetic petroleum industry. By the eve of war in 1939, annual German synthetic production had grown to 16.7 million barrels. During its highest year of production in 1943, Germany produced 42 million barrels of synthetic petroleum; far exceeding the 34 million barrels of crude oil domestically produced or imported during the same period."

Source: TURNING POINT: A HISTORY OF GERMAN PETROLEUM IN WORLD WAR II
AND ITS LESSONS FOR THE ROLE OF OIL IN MODERN AIR WARFARE
Shawn P. Keller, Major, USAF
AY11 Spring Independent Elective
Advisor: Dr. Michael May
"Military history is nothing but a tissue of fictions and legends, only a form of literary invention; reality counts for very little in such affair."

- Gaston de Pawlowski, Dans les rides du front

gracie4241
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Posts: 70
Joined: 03 Aug 2018 16:16
Location: USA

Re: Germany and Oil

Post by gracie4241 » 03 Aug 2018 19:00

The drive to the Caucasus WAS THE ERROR. It grossly lengthened the german front out of all proportion to available resources(divisions) for NO achievable result. They captured Maikopf(?) on august 9 and derived not a drop of oil from it.There is NO reason to believe Grozny or Baku would have yielded a different result(sabotage), not even counting the fact that there was no logistical foundation for shipping it to Germany-it was tilting at a windmill. The goal should not have been to ACQUIRE the oil, but DEPRIVE stalin of it(and the food etc ).This was doable, by following the original BLUE plan phase 3 of a coordinated assault toward the Volga(" at or around Stalingrad") by Army Group a and B. Sealing off the "roof"of the Caucasus from the remainder of the Soviet Union, along with the existing possession of the Ukraine would have lost Stalin 70% of his coal,85-90% of his oil, and 50-60% of his food supply, along with large iron and manganese deposits ! He was SUNK! And the germans would have had a river based defense line they could hold. That this was THE WAR WINNER needn't depend on my argument, but on Stalin himself( see text Basic Order 229 on July 27, 1942 a/k/a as "No Step Back").He clearly states that any further loss of his raw material base was KAPUTT. Chasing this Moscow mirage of that idiot Halder was a throwback to the old "decisive battle" mantra harkening to Sedan 1870(or the Marne 1914).Hitler was 100% right that his generals knew nothing of economics-they didn't. Why he deviated from the essence of his own plan with Directive 45 I cant fathom

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