The New York herald., 1922-01-08
LOWER PRICES AID
MOTOR INDUSTRY
In 1921 There Were 1880, 900
Motor Vehicles Produced
in United States.
By ALFRED REEVES,

General Manager Nationa! Automobile
Chamber of Commerce..
Because automobile manufacturers re-
duced prices directly to the Anal con-
sumer. instead Of lowering them to the
wholesaler and retailer. the automobile
business Jared very much better during
1921 than was generally expected and
better than many other lines Of manu-
facture.
The increasing need for highway
transportation. coupled with price re-
ductions in tires. gasoline and other
permitted a production &C about 1885,
600 motor vehicles or only "a per cent.
less than the 2,305.o00 in the record
year of 1920. OF this 145.000 were
! trucks and about 1.5S5.o00 passenger
cars.
The decrease ir truck production was
proportionately greater than In passerS
ger cars, because OF the falling off in
the demand for transportation that
came in the decrease of general busi-
ness-a development that affected the
railroads to an equal degree.
These reduced prices have not been
without substantial losses to the manu-
facturers and the $4,000 motor car deal
ers, but II was deemed worth while be-
cause with final price adjustments about
completed the industry enters 1922 with
high prices and inventories liquidated,
labor more efficient, finances adjusted
and definite and economical production
programs under way. The adjustments
have been drastic, with comparatively
few motor companies showing any profit
for the past year, but in the opinion OF
economists and bankers the action taken
xgf1 la a
during 1922.
This year the export market Is ex-
pected to broaden. and with better high
ways and general better business condi-
tions the Industry should continue its
steady growth "a growth which Incl
dentally began in 1899 when 3.700 motor
cars were produced. The possibilities OF
the world markets are best shown by
the fact that in 1920 more than 17o.7oo
motor vehicles were exported to ia DIFF
ferent countries.
The 1921 registration figures show a
little more than 100000 cars and
trucks. which mean replacements OF
probably 100000 vehicles this year.
Tho keen competition for these re-
placements and the other potential mar
kets will bring out better cars and better
values than ever before.
A big job for the industry now Is to
keep these 100000 motor vehicles
properly serviced. and II is safe to say
that consumer satisfaction Is going to be
prime factor In the success Of any
company this year.
The 1850, 900 who purchased new mo-
tor vehicles this year have received the
benefits of the postwar readjustment In
prices and Improvement In service.
Wholesale price curves have been falling
generally, but In many businesses the
retailer has yet to take his loss In the
automobile industry. however. the re-
ductlons have all been made direct 10 the
consumer. It is this prompt liquidation
policy which gives promise OF an early
recovery i'm the automobile trade when
general business recovers. Dealers and
manufacturers do not look to see any
larger output In 1929 than in 1921.
unless world conditions take a rapid
change for the better. We cannot go far
ahead OF the general prosperity curve.
but we can lay and are laying basis
to get our full share OF the better times
when they arrive.
Ii will be a hard year for new COM
panies making either cars or trucks.
The inventory of customers shows, for
instance. that the industry has done
relatively little in the line of occupa-
tional selling. The cash register and
adding machine companies analyze
businesses and show where their ma
CT ines can be profitable. The same can
be done for motor transportation. The
automobile industry is just beginning to
realize. for instance. that there are In
the country $4,000 retail bakers, i,13S
boarding schools. 10000 Insurance
agents, $50, 900 doctors.
The retail baker requires a panel body
truck The boarding school needs a
Suburban" motor car or bus. The In
surance agent and the doctor should
have roadsters or small inclosed cars.
Each Of these and other occupations
present sales field requiring special
study. The outlook is promising both
for dealer and maker Locally the deal
en- can work for occupational sales. Ma
tionaily the manufacturer can take the
experience of one territory and pass II
on 90 another. II preparatory school
In Oklahoma buys n depot wagon" car,
this will be a strong point for a sale to
a similar institution In Georgia.
The industry IL also becoming increas-
ingly aware of the fact that II must sell
used cars as we'll as new cars.