Evening star. [volume] (Washington, D.C.) 1854-1972, 1938-08-07
Reports Back Assertions
Drop in Output Hit Low
Several Weeks Ago.
UPTURN IS AT HAND,
OBSERVERS BELIEVE
Industry Is Not Believed Likely.
However, to Have 100000.
Unit Year Soon.
BY DAVID J. WILKIE,

rAsSOS4deeo 1000 AhAuCldi "I!tSEs
DETROIT, Aug. Second quarter
earnings statements of the motor car
industry's leading producers are being
scanned currently with more than
ordinary interest in trade and financial
circles.
In the main they give substantiation
to the assertions of many authorities
in the industry that the decline in
motor vehicle distribution that began
last autumn reached its bottom sew
eral weeks ago.
Leading in trade interest, of course,
were the statements Of General Motors
and Chrysler, both of which showed
a heavy drop as compared with last
years income, but an encouraging in
crease for the second quarter of this
year over the first three months. Gen.
eral Motors, leading volume producer
Of the industry. showed second-quarter
net earnings of $24, 1886, O02, compared
with a f1rst-quarter income of So
234,0l7, while Chrysler reported So
59e,630, against $2,109,s69 for the
first three months this year.
Ford Rise Indicated.
Ford earnings are not published
in the same periodic form as are those
OF the other motor makers. because
the Ford stock is held wholly in the
Ford family. At the same time pro-
duction reports indicate that Mr..
Ford, in common with his major COM
petitors. has experienced an increase
In the second quarter this year.
Less favorable were some of the re-
ports from so-called independent
producers. Generally. however, the
assertions Of trade observers that an
upturn in the business of the auto
mobile industry is at hand is borne
out by the figures 50 far made avail
able.
None Of the motor makers con-
cealed the fact that the years first
quarter was discouraging as compared
with 1887 trends. All pointed out,
however, that last year saw the pro-
-auction OF more than 5,lo0,000t cars
and trucks, volume equalled or ex-
ceeded only once before in the indus
try's history. The years assemblies
were only 100000 below the peak
reached in 1929. with the difference
that most of them were sold while in
1929 more than a million units were
carried over in the following year.
Major Upsurge Not Expected.
None of the industry.s executives
looks for major upsurge next year;
If the aggregate output rises to g.
100000 or 100000 units most pro-
ducers will feel that real progress has
been made in the recovery movement
they say the motorcar industry always
leads.
The general impression in trade
circles is that the industry will not
have another 100000 unit year for
some time to come. It has been the
experience Of the industry that almost
every sudden major upturn in car
output has been followed by some
thing OF a slump. Ordinarily the ex-
cess production has been absorbed at
the expense of but one year Of de-
Ginning output.
1t is along this line of precedent
analyzing that producer and distrib-
utor are thinking at the moment in
looking for fair but not heavy upturn
next year. An increase of 100000
units in production next year would
make favorable showing in the f.
nancial statements of all producing
units of the industry, say these au-
thorities.