Evening star., 1950-12-09
Auto Makers Refusal
To Drop Price Raise
May Bring Controls
By james Y. Newton

By james Y. Newton
Refusal of two large automobile
manufacturers to suspend newly
announced price increases means
that the industry probably will be
one of the first to be placed under
price and wage controls, Federal
stabilization officials indicated
today.
Both General Motors and the
Ford Motor Co. told Alan Valen-
tine, economic stabilization direc-
tor, that they cannot comply with
his request to withhold price in
creases set up for 1851 model cars.
The increases range from about 5
per cent on GIN cars to from S
to per cent on Ford products.
Mr.. Valentine and Price Direc-
tor Michael V. Di Sale warned
that they had the authority to
roll back prices which are found
to be unnecessarily high. And they
also warned that they can apply
controls to individual industries.
There was no doubt but that the
warnings were aimed directly at
the allt0mOhile industry
Increases Immediate.
GIN President C. E. Wilson
ordered the first of the scheduled
price increases-from $50 to $50
on Chevrolet models-into effect
Immediately. He then answered
Mr.. Valentines request for sus-
pension of the increases.
I'VE regret that we find it i'm
practicable to accede to your
sudden request to withhold or
withdraw the reasonable pricing
of our new 1851 model automo-
biles," Mr.. Wilson telegraphed.
He said he thought the increases
in Chevrolet prices were reason
able, considering what has hap
pened to wages and the way raw
materials prices have skyrocketed
with increases ranging from 7
per cent to 300 per cent since our
1850 cars were priced.
Mr.. Wilson said that steel prices
were increased recently by 7 per
cent and that the Government on
December 6 raised the price of
synthetic rubber.
Office Withholds Comment.
Government officials COM
mented that Mr.. Valentines re-
quest to manufacturers to hold
the price line was not nearly so
sudden as GINS decision to raise
prices.
Officially, Mr.. Valentines Office
withheld any direct comment as
to the reasonableness of the auto
price increases pending a meeting
here next Wednesday. But it
was obvious. nevertheless, they
considered the increases as too
high.
Both GIN and Ford accepted
Mr.. Valentines invitation for a
discussion of the automobile-p price
situation here next week. Eight
other manufacturers of cars also
will take part in the meeting.
They have not announced price
increases.
President Henry Ford II also
telegraphed Mr.. Valentine that,
1--WE cannot comply with your re-
quest"
Rising Costs Cited.
Mr. Ford said the increases OF
his. company's understanding
from $3.50 on Fords to $165 on
some Lincolns-went into effect
all over the country on Thursday
He said that the company S
annual costs since the start of
the Korean war last June have
risen more than 500 million on
passenger cars land they are still
going up
An appeal to industry and labor
for voluntary help in battling in
fation was issued earlier at a
news conference held by Mr.. VAL
entine, Mr.. Di Sale and Cyrus S.
Ching, chairman of the new Wage
Sterilization Board.
The three officials indicated
that the widely rumored general
freeze on prices and wages was
not imminent. Mr.. Di Sale said
that from so to 80 days would be
required before he could make the
necessary plans and recruit a staff
Of sufficient size to administer and
enforce such controls.
Wage Rollback Discussed.
But they also indicated that
controls may be clamped on Sc
lected industries where the threat
of imitation is greatest much before
that. Mr., Di Sale said he still
hoped that it would not be neces-
sary to regiment the Nations en-
tire economy.
Mr.. Ching and Mr.. Valentine
even discussed the possibility of
rolling back wages, as well as
prices, something very few experts
believe to be practicable.
Meanwhile, there was increasing
pressure in Congress and else
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