SKF – The company that keeps the war industry rolling
The military industry needs steel ball bearings. Without them, gun turrets can’t rotate, tanks stand still, ships don’t sail and planes don’t fly.
During the Second World War, 80% of the world’s steel ball bearings were manufactured by the Swedish company SKF. Fortunately for the warring parties, i.e. the Axis powers and the Allied nations, Sweden was neutral, and Sweden happily supplied ball bearings throughout the war to both sides. SKF was largely controlled by the Wallenberg family, and Sweden’s ambassadors and consuls abroad did not infrequently promote the interests of SKF or other companies in the Wallenberg sphere.
A pro-Nazi activity
The biggest customer through the war was Germany, and SKF was closely tied to the Nazi hierarchy and the German war effort. For example, SKF chairman and founder Sven Wingquist was one of Sweden’s industrialists who liked to mix with Herman Göring and the pro-Nazi Duke (the abdicated King Edward VIII) and Duchess of Windsor (Wallis Simpson). Among other things, SKF had an agreement with Germany that if more ball bearings were needed than could be produced in SKF’s German factory in Schweinfurt, they would be supplemented with ball bearings from SKF’s factories in Philadelphia or Sweden.
Furthermore, one of the directors of the American SKF, Hugo von Rosen, had close ties to Hermann Göring, who through his marriage to Carin von Kantzow was considered a member of the family. Von Rosen had orders from Stockholm to preferentially supply ball bearings from Philadelphia to Nazi-controlled companies in South America, regardless of the need for this vital product in American industry. SKF in Philadelphia, for example, more often than not had problems fulfilling the orders it received from the US armed forces, including for the extremely important “Pratt Whitney fighter jet engines”. During the war, von Rosen also sent American industrial secrets to Sweden via diplomatic mail from the Swedish Embassy in Washington, to prevent them from being intercepted by British or American intelligence. Diplomatic mail from neutral countries was fortunately excluded from wartime scrutiny.
Von Rosen also exploited this fact by setting up a subsidiary that shipped 600,000 American-made SKF ball bearings a year to South America on ships registered in neutral Panama. The bearings were then forwarded from Rio to Sweden on Panama-registered merchant ships and therefore easily sailed through the Allied naval blockade unmolested. From Gothenburg in Sweden, the bearings then had only one more short journey to German factories.
Profit on both sides of the war
Documents preserved after the war show that the British government ordered special “Navicerts”, documents that exempted the Panama ships from seizure or search. The British were also dependent on SKF ball bearings from Sweden, as Britain’s plant was destroyed by the Luftwaffe early in the war. The Swedish envoy in London during the war, Björn Prytz, who during the First World War served as head of SKF’s subsidiary in the USA until 1919, and then first became CEO of the parent company and then chairman of the board until 1938, may have had something to do with it.
However, this “hands-off SKF” message apparently did not reach General Henry ‘Hap’ Arnold, the commander of the US Army Air Force, who ordered massive bombing raids on SKF’s Schweinfurt factory on 14 October 1943 in an operation called “Pointblank”. Arnold was, however, particularly incensed when the bombing raids were met with such stiff resistance that Arnold’s conclusion could be no other than that the Germans must have been forewarned. Of the 361 heavy bombers that took part in the attack, 60 were lost. Eleven bombers that returned to base were found to be so badly damaged that they were scrapped, and 162 had minor damage.
“I don’t see how they could have prepared the defences as they did if they hadn’t been warned in advance,” an enraged Arnold told the London News Chronicle five days later.
What Arnold didn’t know was that just a week before the attack, the director of SKF in Philadelphia, William Batt – who incidentally also served as vice chairman of the War Production Board and as head of Bosch’s US branch since 1938 – and several other leading US defence officials flew from London to Stockholm to meet with Sven Wingquist and other SKF officials to secure further supplies of ball bearings for the US war industry there. The US mission in London was particularly frustrated that the Swedes had more than tripled their sales of ball bearings to Germany since the outbreak of war, and one of the US generals, Carl Spatz, slammed his fist into the table of the US ambassador to Britain, John Winant, while shouting:
“Our entire bombing campaign has been nullified!”
The American ambassador to Sweden, Herschel Johnson, also protested to Sweden’s foreign minister, Christian Günther, but received only a cold statement that SKF was only fulfilling contracts signed before the war agreements were approved by the US government. “Officially, the Swedish government said it feared that Germany could invade Sweden and seize SKF’s factories if it refused to supply them. However, the cumulative history of the last 200 years speaks a completely different language. It was, as always, about doing business at all costs.
The UK also rejected the US demand for SKF products to be blacklisted, as the UK also needed SKF ball bearings, and blacklisting would inevitably mean an end to Navicert approval for the aforementioned cargo ships. The US therefore finally tried to compensate SKF for lost revenues by stopping exports to Germany. US officials flew to Stockholm and struck a deal worth $8 million with none other than Marcus Wallenberg at the negotiating table. Under the agreement, SKF promised to sharply reduce the supply of ball bearings to Germany, but this unofficial agreement also meant that after the war SKF would keep all its German assets, and that any SKF links to the Nazis would be forgiven and never investigated or exposed in public.
In the US, however, some outraged SKF executives had already leaked to the American press that SKF had strong links to the Nazis and had secretly sent ball bearings to the enemy, and as a consequence unions began calling for strikes against their Nazi-collaborating bosses. However, this small rebellion came to a hasty end the second the secret deal with SKF was signed in Stockholm, after the US Treasury Department issued a statement saying that SKF was completely cleared of any “alleged collusion” with the enemy.
However, deliveries of ball bearings to the Germans continued all the way to the end of the war in 1945. SKF in Sweden circumvented the agreement by sending German-addressed ball bearings via neutral countries such as Spain, Portugal and Switzerland. After the war, SKF resumed control of its plants in Germany, and no further action was taken against its managers von Rosen, Batt or, for that matter, Wallenberg. SKF is still the world’s largest ball bearing manufacturer, employing 48 000 people and with an annual turnover of $7.8 billion.