Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-10-02
AUTOMOBILE TRADE.
READY FOR UPTURN
Surplus Stocks Sharply Re-
duCed Through Cut in Pro-
duCtion Schedule.
BY DAVID J. WILKIE,
Associated Press stan Writer.

DETROIT, October 2.-Just a year
ago the automobile industry, going at
top speed in an effort to set new
one-year production record, discovered
that it had manufactured in nine
months more passenger cars and trucks
than it ever before had made in a
full year. 1t had turned out more than
4,800,0G0 vehicles.
Storerooms of dealers we're filled with
new cars and the protests of retailers
that they were being overstocked be-
came more and more insistent. 1t was,
as most automobile production en-
gineers now will admit, production gone
wild.
Although the industry was going too
fast to shut off production suddenly,
the sharp contrast in conditions today
as they affect retailers generally tells
how effectively the brakes were applied.
Dealers storerooms generally have been
cleaned out Of new merchandise and
it may be said that the industry has
placed itself in the best possible posi-
ton to take full advantage of the in
evitable upturn in consumer demand,
whether it comes within the next few
months or whether it is delayed until
next Spring.
Inventories Reduced.
AS a general proposition the automo-
bile industry, first to feel the effects
of business depression, also Is the first
to recover from it and thus lead in
the revival of general industrial condi-
tions. Because inventories have been
reduced almost to the smallest possible
workable minimum, and because some
lines have shown encouraging improve
ment in certain sections of the country
the feeling has become more or less
general that the worst phase OF the
depression has been passed.
A markedly different relationship be-
tween manufacturer and distributor In
the future is one Of the developments
looked for by most retailers as result
of the experience of 1929-30 In the au-
tomobile industry. In the past the
dealer, as a rule, was left pretty much
to work out his own destiny; he took as
many cars as the producer chose to
ship and If they were more than he
could handle their disposition was his
own problem. Moreover, he had certain
sales quota requirements to meet or lose
his dealer franchise.
In in this connection the dastic steps
taken by some automobile manufac-
turers back in 1920 and 1921, sometimes
called the industry's "leanest" years,
are recalled. One prominent manufac-
turer, reported at the time as facing a
financial crisis, placed his plant in ca
pacity production and shipped cars to
dealers throughout the country, inform
ing them that the cars must be paid for
upon delivery, that they must accept
as many cars as the factory decided to
ship or lose their agency franchises.
Many dealers failed, but most of them
pulled through and the manufacturers
strategy averted financial difficulties for
his company.
In the Introduction Of controlled"
production/the manufacturing division
of the industry initiated the beginning
of a new policy between producer and
retailer and by producing fewer cars
than the dealers sold during the past
year carried out a promise to these re-
tailers that production in the future
would be governed by demand. Barring
something entirely unforeseen CON
trolled" production has come to stay in
the automobile industry and the manu-
facturer has assumed larger respon-
sibility in the ultimate placing Of the
product.
New Models.
The new REQ Royale is making its
initial public appearance this week but,
contrary to custom, is being shown pub
licly first at the Paris Salon de PAuto-
mobile, opening today. First public
showings in the United States will be
made a week hence. The Paris show
heretofore has been regarded as the
greatest exhibition of motor cars in the
world. This year however, it lacks an
exhibit by General Motors, that corpo-
ration having withdrawn as a protest
against the space allotments.
Three new Fights and six by the
Nash Co. also are expected within the
next week or two.
The Parkard Motor Car Co. announced
today that an airplane equipped with one
of its Diesel motors had flown the en-
tire distance of the recent national air
tour, 1895 miles, at a total cost of
$37.15 for 437 gallons of fuel oil. Ac-
tual flying time for the distance was
given as SO hours and 80 minutes.
1t also was announced that several
minor changes have been made in the
motor since it was first brought out by
the late Capt. L. M. WoolSon. The en-
gine'S speed is understood to have been
increased by slightly changing the tim
ing and it Is claimed the objection that
the fuel oil exhaust had made riding
Mt o1cn hoe hoay1