Evening star. [volume] (Washington, D.C.) 1854-1972, 1927-03-18
AUTOMOT|VE TRADE
| IS WATCHING FORD
Answer or Partial Solution
/ Expected to Be Given
Next Week.
BY j. C. ROYLE.
Special Dispatch to The Star.


Special Dispatch to The Star.
NEW YORK, March 1S,-The auto
mobile trade is on tiptoe to learn what
Henry Ford is going to do. Few, ii
any of the factors of the trade expect
him to sit quietly and see the mar
kets he has dominated gradually slip
away, and there is small question
that some of those markets have been
most successfully invaded by others
The men most closely in touch with
the situation anticipate a slashing
price cut as his first move and they
fix next week as the time for its an
nouncement.
Dispatches from Detroit declare
that machinery, molds, bodies and
equipment for the production of a
six-cylinder car, which will sell fully
equipped at around $500 are being rap
idly assembled.
With regard to this, as with myriad
other rumors, there is no contirma
ton, although it is known that Edsel
Ford has been in favor of the pro
duction of new models.
New Model Runoreh
The production of a new model,
however, is what is worrying com
petitions for the moment. introduce
ton of a new line of cars is a long
winded business. First, thousands OF
agents must be supplied with show
cars. The foreign branches of the
Ford Co. alone would require thou
sands of units. Then sufficient cars
have to be made or in process of man
ufacture to fill orders.
1t is the prospective price cut that
Is causing the most uneasiness. There
l.ar tn air q
General Motors Corporation is allow
ing Chevrolet dealers $50 for each
Ford car taken as a trade-in and
junked. This report, even II 1t were
true-and it is not-iS highly illogical.
The idea of the rumor was that Such
a policy would result in the scrapplng
of a million Ford cars and cost Gen
eral Motors $50, 900 600, damaging the
most active Ford competitor to that
extent. Nothing could please General
Motors better than to do just that.
They would willingly pay $5O,0O0,OO0
in order to sell approximately SID
100000 worth of Chevrolets to mil
lion Ford owners. 1t would give
Chevrolet the greatest year it ever has
hoped to have.
Many people in the automobile trade
seem to expect a direct drive by Ford
against General Motors. This is
scarcely feasible, even if Ford were
disposed to make such a move. Gen
eral Motors has cars in six different
price fields. Ford could only possibly
attack them in two, Chevrolet and
Cadillac, with which the Lincoln car
made by Ford would come in eompe-
tition. Ford has other strong competi-
tors besides General Motors, includ-
ing Durant, WHY'S and the Dodge Co.
Chary of Trade-ins.
The fact of the matter is that deal
ers Of all sorts are being exceedingly
cautions in taking F'ords in trade be-
cause of the likelihood of a price cut
or the presentation of new model
The new model, if it is produced at
the price suggested, would show little
variation from the present Ford
range, since the Ford sedan sells here
for $500.
Another report is that for the past
year Ford has been turning many of
his real estate holdings into cash and
piling up cash reserves from sales of
cars and parts from stock, thereby
accommodating a war chest of about
$500 ,000,0 900. For good many years. 1t
is known, Ford has had bank accounts
throughout the country aggregating
$500, 600 200. He has had no need to
marshal cash reserves and there is
no evidence that he has done so.
Some competitors take the stand
that they don't care what Ford does
and that if the public does not want
Ford cars at present prices it will not
want them at lower price. None
theless, they are anxious. There is
no doubt Ford could cut prices deeply
without sacrificing his profit margin
entirely. Some anticipate a cut as
large as SITS on some models.