The Bottom for TV?

For the television-set makers, who have been plagued by falling sales and big inventories, Admiral Corp. had some more bad news last week. The fourth biggest TV maker, Admiral held a warehouse sale for dealers to unload its 1957 sets at cut-rate prices before its new models come out in mid-June.

Admiral's sale was part of the industrywide drive to clear the shelves. After a disappointing Christmas, the industry's inventory of sets was 19% above a year ago. By May, thanks to production cutbacks, hard selling and price cutting, inventories were under last year's.

But the clearance had a painful effect on profits. Grumbled Motorola Vice President Robert Galvin: "In the last two years the industry has sold 14 million sets without anybody making a nickel." Agreed Admiral's Chairman Ross Siragusa: "We the manufacturers, you the distributors and our dealers have been the greatest philanthropists in the United States."

Fight to Survive. The set makers troubles stemmed from the harsh struggle for position and survival in an industry that has long since passed the stage of easy growth. Since 1954 the number of manufacturers has dropped from 101 to 32, of whom ten or twelve do most of the business. Each time a producer quit, the efforts to liquidate his inventory touched off another shuddering round of price competition among the survivors. In addition, the whole TV price level slid downhill with General Electric's introduction of portable sets priced substantially below table or console models. Though portables were hailed as opening a brand-new market for the gadget-minded and the second-set crowd, they actually grabbed off 40% of the first-set and replacement market for a time.

Despite these troubles, the industry felt that the worst was about over and that prices could be boosted to make up for some of the recent increases in material and labor costs. Said Sol Polk, Chicago retailer: "Today there is no greater value than a television set. I'm selling sets for less than I think I can replace them for in six days." Throughout the industry, business was picking up. Magnavox, in a strong position because of its policy of sticking to higher-priced table models and consoles, reported its first-quarter unit sales were up and 20% over last year. G.E. had trimmed its line of portables from nine to six, table models from seven to six, and beefed up its higher-priced console models from eight to 13. In the rising optimism Motorola, Admiral and others were boosting their whole price line a minimum of $10 a set.

New Tube. Hope of the industry for 1958 is the new wide-angle picture tube pioneered by Sylvania. By widening the projection angle from 90DEG to 110DEG, the new tube cuts 4 to 6 in. off cabinet depth, up to 50% off bulk. Herbert Riegelman, G.E. TV general manager, calls the new "slim line" the "industry's first opportunity for planned obsolescence," hopes that the new flatter sets will bring TV back into the living room as the old bulkier set is relegated to the playroom.

The upward trend in television-set prices brought only smiles from Radio Corp. of America. RCA had hoped that its $500 color set would bring the big breakthrough for color TV. But when black-and-white prices slid as low as $100 on some new portables, color lost out. With black-and-white prices going up, closing the price gap on color, Vice President Robert Seidel said RCA color sales this year were running two to one over 1956. Sylvania's President Don Mitchell estimated that 1957 color sales by the entire industry will run from 200,000 to 250,000.

The Institute of Appliance Manufacturers last week confirmed that 1957 so far has been a poor year for other appliances too. Estimating that 1957 will register an overall 5% to 10% decline in the sale of major appliances compared with 1956, the institute disclosed that in the first four months of the year some drops were even sharper. Sales of free-standing electric and gas ranges were down 21% and 10% respectively. Combination washers and dryers were down 24%. wringer washers 30%, electric dryers 26%, gas dryers 10%. But because of shifts in consumer likes, some newer lines showed strength. Sales of electric built-in ranges were up 27%, gas built-in ranges up 41%.

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