The New York herald., 1921-01-13
MOTOR INDUSTRY
PAST BOOM STAGE
Automobile Manufacturers
Will Follow Stable Lines
of Growth Hereafter.
by GEORGE NJ. DICKSON.

President National Motor Car and We
hicle Corporation, Indianapolis. Ind.
The wild and hectic boom period OF
the automobile industry seems to be
pretty well over. Announcements of
doubled and tripled factory capacity
that were so general only year ago
are now conspicuously absent
The present producing capacity OF the
industry seems such that II can take
care of any demand for some time TO
come without material additions or plant
extensions.
For the first time in automobile his
tory the manufacturer is able to esti-
mate his market with reasonable GER
tainty and to formulate a programme
from which the item of speculation has
been practically elmira rated.
Just as in the glove. hosiery furni-
ture and other lines of business. manu-
facturers know about how much OF their
product the market will absorb year
after year, so automobile manufacturers
will know henceforth what Is their nor
NAL proportion Of the total market and
be able to lay their pans accordingly.
Undoubtedly the industry will still
continue to grow and expand. but this
expansion will proceed with caution and
conservatism, at about the same or
slightly more rapid rate than Is main
tanned by other lines of esta blished In
dustry. whose growth is definitely re-
lated to the worlds total increase In
wealth and population. neither tagging
behind nor outstrippng II very far.
Until recently, most automobile manu-
facturers saw before them practically
unlimited market. and consequently
strained their resources and credit facil-
tiles to the utmost in expanding to meet
the seemingly inexhaustible demand
True, the industry experienced de-
pressions from time to time, resulting
In the conclusion on the part Of some
that the point of saturation had been
reached. Each time, however. It was
found that the check had been only tenn
porary, and, upon recovery. expansion
proceeded with renewed Yigor.
It has been evident all along. Of
course. that the process could not con-
'inue indefinitely. Just as a rapidly
growing boy eventually arrives at man
hood, the youthful automobile industry
was destined to reach its maturity some
time
That day seems to have come.
The automobile industry to-day Is the
second largest in the world. In strength
nd power 1t has assuredly arrived at a
mans estate. with a total production for
1921 of more than 100000 passenger
cars and trucks. q
Henceforth. the industry may be COM
pared to colossus who has arrived at
his full powers. instead OF to a young
giant who amazes every one by his daily.
sensational growth. Though the indus
try will continue gradually to enlarge its
power and activities. in the main it Will
be concerned with holding what 1t has
already won.
The replacement business. manufac-
turing new cars to replace those worn
out in service will soon be sufficient to
keep the industry running at prac-
tically normal speed. and this. with the
inevitable new business that VIII come.
will keep the present capacity OF the In
dustry productivity and profitably en-
ployed as long as the demand for auto
motive transportation exists.
To quote few facts and figures, 1T
is estimated that the life of the aver
age motor car or truck built half
dozen years or so ago is about five
years. In 1916, more than 1,J0O,OOO pas
senger cars and trucks were manufac-
tured. most of which will have to be
replaced in 1921. In 1922, 1t is estimated
that this business will total 100000
cars and trucks with q proportionate
Increase every year following, until
within the next six OF seven years II
will probably have reached 2.25oV0 per
annum.
There are, of course, many areas on
the worlds surface where the use OF
the automobile is still quite limited. and
certain optimists have interpreted this
as an opportunity for the automobile
industry to continue indefinitely its
sensationally rapid growth and expan
sion.
II must be remembered. however, that
these countries afford no field compar-
able to the United States in wealth
and In the enterprise of their popula-
tions, and that before they can become
markets equally as great as the United
States, they must rise to the same plane
of economic development.
The automobile has spent many years
In catching up with other commodities,
but 1t seems to have become staple
at last
r-v~ yHr, MAN A1rNInTrNYnTC aftYY TIT