The outlay for tools and tackle would, I think, also be greater than he seems to anticipate, and on the whole I cannot but come to the conclusion in my own mind, and I should not act rightly if I did not communicate that opinion to you, that the first outlay will be fully as large and probably larger by adopting the plan of making our own engines than by employing a manufacturer. It is true we shall have some valuable and costly tools and shops included in this outlay, and a fine establishment formed, which may be rendered fully competent in point of means to continue the manufacture of engines for others, and to keep up the repairs of any number of engines which the Company are likely to have at work. My only fear would be that of the risk of the undertaking being too great for a newly-formed establishment. The making of the vessel itself is no mean effort, and to superadd the construction of the largest pair of engines and boilers yet made, and upon a new plan, is calculating very much upon every effort being successful, and particularly upon the continued assistance of those who have hitherto attended to the subject; as it must be well known to the Directors that if Mr. Guppy, for instance, should be prevented from giving his time as he has hitherto done, or if Mr. Humphrys should, from illness or other causes, leave us, the manufactory would be brought to a stand, and the loss would be serious. I have no wish to deter the Company from becoming their own manufacturers--I think it a course which must ultimately be adopted if the Company thrive--but I should have much preferred that it had been adopted gradually, that we had commenced with a vessel, and then proceeded with boilers and repairs; and, as our establishment became formed and matured, and when we might no longer depend entirely upon the engineering talents and assistance of one Director, who may be unable to attend to it, or upon the health of one superintendent who, as yet, is alone in possession of all our plans and ideas, and at present is alone capable of carrying them out, we might then have ventured upon making the engines perhaps for the third vessel. Circumstances may, however, render it necessary that we should proceed more expeditiously, and I am only anxious that the Directors should be aware of the difficulties that we may have to encounter, and that they should not form expectations as regards economy in which they may be disappointed. The result of the best consideration I have been able to give to it is, that the question does not seem to be one of cost. In that respect, according to my view, the two modes of proceeding would be nearly balanced, but it resolves itself into the following question:--Is it better in our