Evening star., 1929-12-08
AUTO PRODUCTION
TO Be REGULATED
Cram Says Supervision Will
Prevent Abrupt CurtaiI-
ment in 1890.

A more regulative supervision of pro-
duction will be enforced during 1880 by
manufacturers to preclude the recur-
renee of such abrupt curtailment of
output as has been necessary in the
last half of the current year, accord
Ing to B. H. Cram, president of Grams
Automotive Reports, Inc. New and
used car stock in the field will be
Kept, as far as possible, within pro-
portionate limits from the first of the
year so that during the closing months
they will not be found unwieldy.
The current year has proved conclu-
sively number of things, hitherto
more or less matters of conjecture. Al
though in the Substantiation of these
facts both manufacturers and dealers
have been caused some discomfort, the
mask OF false optimism enveloping the
production end of the industry has been
removed and manufacturers, now seeing
the situation in its true light, should
be able to outline programs for the
immediate future with greater aSsur-
ance OF security, both to themselves and
the dealers.
Industry Given Warning.
First, the industry has been shown
that, after all, there is an approximate
limit to the number of new automobiles
the markets of the United States and
Canada can absorb in one year. The
limit at present appears to be about
100000 units, including replacement
and export. OF course the actual num-
Der Is variable, depending upon the
fluctuations of general economic and
business conditions from year to year,
with resulting variations in purchasing
power. Registrations for 1929 may ex-
ceed the above figure slightly, but this
TaT1rnGoTfc RI rDf
industry's history and the sales figure
attained through the Straining of every
effort.
This estimate is made in considera-
ton OF the fact that it is impossible to
flx an absolute limit to the number of
cars that may be sold. The above
hgure in years to come will be revised
upward as the population increases,
highway construction continues and
improved manufacturing methods make
1t easier for the public to buy. For the
present, however, a market absorbing
about 100000 units represents the
peak, and this figure certainly will not
be exceeded in 1880, although it very
we'll may be in few years hence.
Conservative Trend Necessary.
Second, the effect of the unprece-
dented production on the dealers also
indicates that the trend must be more
conservative for while If they are to
remain in business. Few dealers will
break any earnings records this year.
Indeed, those who finished the year on
the protlt side of the leger probably
VIII be considerably fewer in number
than in 1928. The drastic retrench-
ment in output schedules of manufac-
turerS during recent months and
strenuous sales efforts have been the
means whereby the dealers have been
able to reach even their present status
OF new and used car stocks.
Although manufacturers considera-
tlon OF their dealers generally is salts
factory, the production policy existing
this year almost overwhelmed the
dealers before they or the manufac-
turerS, to all appearances, realized what
was wa happening. The practice of forcing
dealers to take more cars than they
reasonably ought to sell in their respec-
tive territories is one which exists in
frequently, yet 1t does exist.
In the sweep of the early months of
the year many dealers were over
loaded, although in most instances it
was not done deliberately but because
both dealers and manufacturers placed
too much confidence in the markets
ultimate consumption. Saddled with
improbable sales quotas, they have
since been forced to struggle desperate
ly to emerge successfully from the
stocks with which they were burdened.
Change FOreseen in 1880.
These various developments which
the current year has brought forth
preSage a change in program for 1880.
The underlying causes for virtually all
conditions that exist may be found in
production, or rather over-production.
Therefore, the coming year will witness
no general attempt to establish a new
all-tirne output record. Getting under
way slowly after the national automo-
bile shows, output will gain momen-
tum more gradually than in 1929. The
peak of production may be expected to
occur some where near the third quar-
ter. instead of earlier as during the
current year. Sensational Step-ups in
schedules from week to week will be
few and a policy of caution will be the
general rule. with greater care exercised
in stocking dealers to prevent over
loading.
It is much too early to venture
prediction as to the output volume for
1880, but it may safely be reckoned
at figure considerably lower than the
final amount for 1929. With close to
$500, 900 units apparently assured for the
current year, 1t seems reasonable to say
that next years production should be
estimated at levels comparable to those
Of 1923.