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22nd. February, 1911.
546
I beg to acknowledge the receipt of your
letter of the 10th. February enumerating three leading princi-
-ples.
As regards the first, we agree that the
number of trains to be run shall be such as will meet the
requirements of through express passenger traffic.
The second principle laid down is that the provision of rolling stock shall be in proportion to mileage. Though, with the reservation that engines and employees on the train shall be changed at Sam Chun, this can be carried out, my opinion is that, as the number of the different classes of passenger coaches varies, and as the cost of manufacture of such coaches also varies rendering increases or reduction in the quantity of rolling stock very difficult, it would be better for each section to charge rent for rolling stock in the proportion of one to four. There is sure to be an easy method of calculat- -ing the apportionment, the details of which I beg to be furnish- -ed with. If it can be carried into effect, we shall be happy to
adopt it.
As regards the third principle, namely, our proposal to charge third class passengers one cent for every English mile, this rate is one-third less than our charges for slow trains on our own section. I note that you agree to adopt
our rates for temporary trial.
The rates charged by you (on your local traffic) have not been reduced at all (in á connection with through traffic). I hope that you will make reduction similar to ours so that we can compete with steamers for passengers; other- -wise the reduction made on our section alone would have no
beneficial effect. I beg to request that you will take this
question of reduction into your consideration and apprise me of
your