Henry Melville Whitney - Shipping and Industral Interests

Shipping and Industral Interests

Upon his father's death on October 24, 1878, Whitney was elected his successor as president of the Metropolitan Steamship Company, retaining the position of agent at Boston.

Whitney established the West End Street Railway Company with himself as president in 1886 as a combination of the five street railways of the Boston area. He introduced the use of electricity as the road's motive power in 1888, replacing its 10,000 horses, and by 1900 it comprised a rapid transit system second to none.

In 1889 Whitney and Frederick Stark Pearson, chief engineer of the West End Street Railway Company, formed the Whitney coal syndicate with Benjamin Franklin Pearson of the People's Heat and Light Company of Halifax, Nova Scotia. The group purchased one coal mine and obtained options on others south of Sydney in eastern Cape Breton Island. Premier William Stevens Fielding and the Liberal provincial administration favored Whitney's entry into the coal business because his steamships and street-railway electric generators consumed large quantities of coal. The Whitney syndicate was offered an unprecedented 99-year lease at a fixed royalty; the group exercised its options, acquiring most of the existing bituminous coal mines of eastern Cape Breton Island and co-opting such local figures as John Stewart McLennan and David MacKeen. This process took some months, and Whitney was not ready to consolidate operations at Sydney until early 1893.

Meanwhile, in June 1890 the Metropolitan Steamship Company placed the new iron steamer H.M. Whitney in service between Boston and New York. The 2,706-ton, 288-foot vessel was built by William Cramp and Sons at Philadelphia. The H.M. Whitney was flagship of the Metropolitan fleet until she was run down and sunk by the steamer Ottoman in Boston harbor on September 28, 1892. No lives were lost, and the H.M. Whitney was later refloated and, after reconditioning, returned to service.

On February 1, 1893, the Dominion Coal Company Ltd. (DOMCO) was incorporated with Whitney as president, B.F. Pearson as secretary and F.S. Pearson as chief engineer. Early investors in this enterprise included Whitney's younger brother, William C. Whitney; his brothers-in-law, Henry F. Dimock and Charles T. Barney; and Almeric H. Paget, who later married William's daughter Pauline.

The new company quickly effected numerous efficiencies and improvements, and production was quadrupled within a decade. There were, however, costly mistakes, prominent among them the tendency to become locked into low-price contracts (such as to Whitney's companies), thus missing a large market at higher prices. By 1901 some 90 per cent of its output was committed to such low-price contracts. The company made a large public offering of stock, which tumbled in price when Whitney failed to get the American import duty on coal removed or at least reduced.

Similar problems were encountered by People's Heat and Light after it was incorporated in 1893 with Whitney as president and B.F. Pearson as secretary. Although People's Heat and Light had the advantage of low-cost coal, it was plagued by substandard materials, limited technical experience, and stock-market speculations, with the result that the company, in the words of Kyle Jolliffe, "collapsed under the heavy weight of its own debts" in 1902.

Back in Boston, Whitney established the New England Gas and Coke Company for the purpose of manufacturing and distributing illuminating gas and railroad-grade coke. In January 1896 Whitney announced the organization of the Massachusetts Pipe Line Gas Company. The new concern would purchase gas from New England Gas and Coke, which in turn purchased its raw material from DOMCO. A new contract between DOMCO and New England Gas and Coke was signed on September 30, 1897, and by mid-1899 a new gas plant was in operation in Everett, Massachusetts. The arrangement led to the unfortunate public perception that the contract had been intended to enhance the value of the companies' stock.

Whitney expanded operations at Sydney with the organization in March 1899 of the Dominion Iron and Steel Company Ltd. (DISCO), which had financial backing in both Canada and the United States. Whitney was joined in the new enterprise by his long-time business friends - F.S. Pearson, B.F. Pearson, W.C. Whitney, C.T. Barney, H.F. Dimock, A.H. Paget and J.S. McLennan. The promise of federal bounties, together with concessions from the Liberal provincial administration of Premier George Henry Murray, enabled DISCO to begin work in June 1899 on the largest integrated steel mill in the British Empire. Located on the south side of Sydney Harbour, which Whitney said offered more advantages than anywhere else in the world, the mill was completed in 1901. Iron ore was mined by DISCO on Bell Island in Newfoundland and shipped to Sydney.

Competitors in Britain, France, Germany and the United States were initially concerned. However, continuing problems of management and cost control led to Whatney's early withdrawal from the project. Later in 1901, Whitney and his associates sold majority control of DOMCO to James Ross of Montreal and their minority share of DISCO to Ross and several other Canadian interests. Whitney resigned as president of DISCO in 1902 and as a member of the DOMCO board in December 1903. Although he remained on the DISCO board until 1909, his focus was redirected to New England. James H. Plummer of Toronto gained control of DISCO in 1903 and DOMCO in 1910, placing them under the Dominion Steel Corporation in 1910.

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