Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-07-05
AUTO INVENTORIES
SHARPLY REDUCED
No New Model Plan Has
Helped RetiIers to Dispose
of Stocks.
BY DAVID J. WILKIE.

Written for the Associated Press.
DETROIT. July I'm the midst Of the
quiet period" that has become more or
less of q tradition in Midsummer, the
automobile industry continues ia
ponder over the effect on the retail
division Of the move decided upon by
many manufacturers to bring out no
new models in June, July and August.
Although the policy, agreed to and
adhered to by many Of the industry'a
leading companies, was looked upon as
q means Of circumventing q Midsum-
mer falling on in retail distribution,
the Summer months Of the recovery
year." seemingly are destined to be no
different than those Of previous years.
In other years most Of the new models
have been OF the assembly lines and
in distributors hands during the mid
year season. The effect, in q general
way. has been to influence potential
buyers to withhold their purchases un-
til the new lines could be examined.
Fair Trial Prevented.
Sponsors of the Midsummer model
policy point out that q combination OF
circumstances has operated to prevent
fair trial of the plan. Potential buy
ers. they say, have withheld purchases
because Of unemployment and conse-
quent curtailed income. Moreover.
they explain, some manufacturers, with
their new models already on blueprints
and factory re-tocling begun, were
unable to hold back the new cars until
November and December, as the plan
originally contemplated.
Despite its only partial observance
anS che fact it apparently has failed to
favolably affect the retail trade, the
plan has helped materially in reduc-
ing dealers inventories, so that when
additional new models are brought out
in the latter months Of the year, retail
distributors handling these makes
should be in better shape for stocking
new cars than they have been for
many months.
The reduction of inventories, both in
the factories and in the sales rooms.
has been an objective of the automo-
bile industry ever since 1t was jolted
into the realization in the Fall Of 1929
that it was travelling with the produc-
ton accelerator tied down and its brake
bands worn out. Figuratively the in
dustry is back on the paved highway,
and while 1t is moving at reduced speed,
the reduction of inventories, the cur
tailment of production costs, the elimi-
nation of wasteful practices both in fac
tory and in sales room justify the state
ment heard frequently during the last
few months that, viewed from every
angle, it is functioning like new car.
With the tapering on Of output and
retail demand during the last few weeks
q disinclination to estimate the indus
trys total output for 1881 appears to
have developed. Earlier in the year
predictions were heard Of q total pro-
duction in excess of 100000 units.
This has been revised downward, how
ever, and later guess placed the fgure
at $500, 900. Whether the actual out
put will even approximate that OF last
year seemingly depends upon what the
early Fall months bring in the way OF
retail demand.
Outlook Is Better.
Regardless of what the ultimate total
shows, 1t appears safe to say the in
dustry at the end of 1881 will find itself
in decidedly better shape from every
viewpoint than 1t was at the close OF
dition will be due to the fact that, az
cepting normal retail stocks, every car
produced will have been sold. This
will have been accomplished as result
Of the careful restriction Of supply ia
demand.
Looking into next year and even the
year after, some authorities in the in
dustry profess to see an absolute level,
ing on of the production peaks and
valleys to the point where output-and
coincidentally employment - will be
more nearly uniform and steady the
year around. While in other quartert
some question has been raised whetheI
this can be accomplished In an indus.
try as widespread and as competitive
asthe making and selling Of automos
biles, there appears to be little dis.
agreement with the statement that the
| industry never again win be permitted
| to get oft Of hand as it did In the
uncontrolled drive for production rec
d.