The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1923-04-23
COUSINS WRITES
Of MOTOR
TRADES
Finds Danger Signals Flying
and Warns of Possible
Over-Expansion.

Herewith Is the first of a series
of three articles on the automobile
Industry and ats outlook. Because
of the extraordinary prosperity OF
fen motor ntGnMf GctuTers last
year, some Wall street brokerage
houses haze started a campaign to
bull further the prices of Gutonso-
bile shares, 1Ohem they haze Gp-
pcrently reached their highest
prices. COnservGtivism is neces-
Sdry an investing I motor Oone-
PGlty stock ut present.
By w. S. COUSINS.
copyright, 1928. by Cosmopolitan News
Service.l
NEW YORK, April 23.-Is auto
mobile production, which this year
1s expected to establish new rec
ord, being accelerated too fast?
Is expansion of plant facilities go
ing =. cad at too fast a pace?
win the next jolt of the nations
prosperity wagon come from a
blowout in the automobile industry?
These are pertinent questions and
no satisfactory answer may be
gained without canvassing the chief
factors in the automobile industry.
Are there sign osts pointing to
q DETECTION in the motor industry,
such as came in all industries in
1920 when the silk shirt bubble was
punctured?
automobile manufacturing should
Iak To- he v1nak uySll
bring it about?
Some Bad Signs.
1t may seem impertinent to set
forth queries of this character at
q time when the whole automobile
manufacturing industry is going
ahead at top notch, unable to pro-.
duce cars fast enough for the trade
and unable TO get adequate freight
facilities for cars that are ready for
delivery.
But while the industry is going
apace, all sails set for continued
prosperity, there have been some
very bad signs recently which merit
attention.
One Is the fact that the small
number Of big automobile producers
have been and are very prosperous
anu ILLS HAS SANOn opportunity Luz
stock promoters to do a bit of
financial pyramiding for weaker
motor companies.
Another salient fact is that auto
mobile manufacturers may be
caught between the millstones of
higher costs for materials, neces-
stating higher prices for their cars,
with the possible reaction that will
follow any price increase. Within
q couple months 1t is fully expected
q number Of motor manufacturers
will have to decide whether they
shall assume the risk of making
price advances for their cars, with
the possible-yes, notwithstanding
off in business.
Not An Alarmist.
This series of articles is written,
not to present an alarmist view of
the motor industry, which is one Of
the foremost in the country and de-
nnands all due respect and en-
couragement, but to protect the
thousands of investors whose mail
Ii clogged at present with alluring
Wall street circulars booming motor
stocks.
When so-called investment houses
sign their names to estimates of
from thirty TO forty million motor
cars, operating in use in this coun.
try within the next ten years, and
to advise the purchase of stock on
that basis, it is clearly time to call
q halt.
The production records for 1922
show a total output of passenger
cars and trucks in the amount of
2,577,765. But it can by no means
be inferred that over 100000 cars
were added to the total vehicles in
operation. General Manager Alfred
Reeves, of the National Automobile
Chamber of Commerce, estimates
that at least 100000 cars are
needed each year for replacement
which alone absorbs 66 per cent of
the new gas wagons turned out last
year. All things considered, 1t is
simple matter of arithmetic to
calculate when the total number