The Richmond Virginian. (Richmond, Va.) 1910-1920, 1913-02-16
He Argues Against
Selling Below the
Cost Of Machine

Unfortunate financial embarrass-
meBt has forced "a number OK wen
known automobile manufacturers to
market their production at figures
which in many instances win not
cover the cost Of manufacture some
of tho cars now offered at an abnor-
mai reduction are makes that have
been given national publicity for the
past two or three years. and have !es-
fablished a reputation which couiG
now be capitalized to advantage HAD
the growth OF the companies been
gradual building UP rather than an
attempt to spring at once to the fore
front. without the usual attention
given TO organization and is resultant
economies,
The object of this article is not.
however. 10 discuss the depiorahle
condition Of certain Institutions, but
rather a resume of how this condi-
ton Of affairs affects the sale of motor
cars manufactured by old established
companies.
A prospect may have in mind the
purchase of q we'll known make OF
motor car, the price of which is the
same as the list price OF the car that
Is being sold at a sacrifice, but the
dealer or agent for the dereiict makes
a reduction of Is or 90 per cent from
the list price. his argument being
that his company had consigned big
shipment TO some foreign country and
a revolution, earthquake or similar
catastrophe prevented the shipment;
one method of disposing of his stock
ia through certain dealers who handle
ssx.t Af n
These dealers then advertise the
fact that they have just secured a
consignment of well-known automo-
biles which were originally ordered
by the Balkan representative of one
Of Americas most successful motor
car companies, but on account of the
recent crisis in that country the or
der was cancelled.
The slaughter now commences. Re
putable dealers for that particular
car are face to face with a disagree
able and unbusinessitke condition
and competitors are forced TO see
drawn into the net of the second
hand dealer, who has profited by
the so-called Balkan situation. The
The prospect, attracted by the unusu-
ally low price, has forgotten to in
quire about the service the factory
is supposed to give and has no
thought for the future when he s. VII
require repairs and parts and the N my
little attentions that a factory an
give. His purchase may give wy
satisfactory service, but when he
wishes to sell his car and get a tw
one he finds that the company w kh
manufactured the car originalh Ia
in the hands of a. ret eiver or is nut
Of business entirely, nd he eve iu-
ally loses as much On the transac ion
as he .riginally M ed by purchasing
at cost,
This season has witnessed tha par
tial dissolution of several widely al
vertised concerns. each of which has
hundreds of thousands of dollars Inc
vested In motor cars and materials.
Five or six hundred such cars for
sale In q city means a composition
of common sense against the ir1f1e-
diate prospect of saving q few hum
dred on the part of the purchaser by
investing In bargain sale" nutomo-
bile that will eventually turn out to
be IL white elephant, and also means
that hundreds of prospects have been
taken from the legitimate channels
of trade, which causes a certain
amount OF stagnation that would have
fallen to the lot Of the bargain sale
manufacturer had his car been sold
with even O small margin of profit.
This situation will not nave a last
Ing effect on business conditions but
Ii la viewed with more or less dis
taste by many reputable dealers who
eagerly invite fair competition, but
are unable to meet bargain sale
! prices. The wedding out process has
started in earnest, and in one or two
( seasons more 1t is safe to assume
that every manufacturer who is then
engaged in business will have proven
/ his right as n survivor purely upon
& tz.a rSs x4I - IL
production and not upon his ability
merely to finance and advertise
motor car company whose product
4 will not sustain its own weight be-
cause Of poor business management
Fitting n Gasoline Float
! Every driver feels the need of a
! float for showing the hnirhf of the