Automobile Prospects

Psychology as well as economic principles plays an essential part in the American automobile industry. Faced with overproduction, huge secondhand stocks, and sharp price competition, many car companies are seeking their individual salvation by tempting the public with new models and thus encouraging continued heavy buying.

This tendency toward new models is only a phase of the severe competition in the business. One company announces a novel appliance or feature. If it gains public favor, all the other companies hasten to adopt it too. Once a new model is finished and on the market, each concern starts planning feverishly on its next model. Hence, the industry as a whole is very "spotty"; while one large Detroit company has virtually shut down, another is planning for greatly increased production.

The pioneer stage of the motorcar business is past. Now the changes in models are not so much genuine mechanical improvements as "selling points." This Spring the balloon tire and the four-wheel brake were novelties; now they are practically standard equipment. With the present new crop of "latest models," the chief feature consists in selling eight-cylinder cars in the moderate price field, and selling sixes at or under the existing prices for fours. The last Buick is such a six-cylinder model. What tomorrow's "new feature" will be, no one knows, least of all the manufacturers themselves.