Day of the Babies

Turin's Valentino Exhibition Palace was ablaze with chrome and bright-painted metal. On view at Italy's oldest and biggest auto show were the pride and joy of the world's automakers: 64 models from twelve nations, including General Motors' opulent Cadillac, Czechoslovakia's tanklike Tatra, Britain's 150-m.p.h. Aston Martin racer. But the stars of the show were not the big, the swift or the beautiful. They were the small, neatly styled economy cars that spark the biggest boom Europe's automakers have ever known. This year the industry will produce better than 4,500,000 small cars--and export something like 45% of them to eager customers in every corner of the globe.

Filling the Chinks. Unlike Detroit's designers, who change styles each year, Europe's small-car men hardly touched their existing models this year. Instead, they concentrated on bringing out a fleet of brand-new cars to fill in the gaps in their lines and expand their growing markets still more. Italy's Fiat brought out an 81-h.p. hardtop two-seater to compete in the $3,200 price class with Britain's popular Austin Healeys, added a new baby line called the "Jolly," with four wicker seats and a price tag of about $1,000. France's big-selling Simca has a new line of medium-priced ($1,445 to $1,968) sedans in 144 model and color combinations. Renault, which has sold 1,000,000 baby cars in the last ten years, is moving into the sports-car class with a snappy two-seater called the Floride at $2,023. And everyone from Citroen to Britain's Austin is jumping into the station-wagon market with low-priced cars that combine the features of conventional sedans long popular with Europe's buyers with the roominess of businesslike carryalls.

The new models are just frosting on the foreign carmakers' cake. The older cars sell so well that almost every producer is ahead from 10% to 30% this year. With a new 350-acre plant at Mira-fiori, Italy's Fiat is making 1,400 cars daily, up about 40% from last year. In France, Simca alone expects to turn out 210,000 cars in 1958, v. 170,000 in 1957, while the industry as a whole will top the 1,000,000 mark for a 100% increase in the last four years. Biggest jump of all: West Germany, which made 958,967 cars in 1957, will boost production to 1,500,000 units in 1958.

Selling the World. Booming domestic markets account for some of the expansion, e.g., Volkswagen has an eight-to-ten-months waiting list at home. But the bigger push is for exports, which gobble UP 57% of Volkswagen's production, 75% of Porsche's, 40% of Fiat's, 33% of Renault's output.

The strongest customer is still the U.S. In September foreign cars reached a record 10.3% of the total market, almost triple last year's 3.5%. Estimates are that exports to the U.S. will hit 350,000 cars this year, climb to 500,000 in 1959. Britain's Vauxhall already sells as many cars in the U.S. as it does in Britain, and Italy's automakers, who shipped a mere 61 cars to the U.S. ten years ago, expect this year to sell 25,000 worth some $30 million.

More surprising than sales to the car-minded U.S. is the growing export competition within Europe itself. Italy's biggest customer is not the U.S. but Germany, where Fiat's tiny, inexpensive (around $1,000) 600 series has jumped into fourth spot in sales, seventh place last year. Competition is so intense that Fiat recently chopped prices from 2% to 15% clear across the board on its passenger and commercial line. Not to be outdone, Volkswagen lopped $300 (to $1,750) off its de luxe sedan. But the cut was for the Italian market only.

Beyond Europe and the U.S., small-car makers are learning to tap markets in developing nations around the world where economy is more important than power or size. Foreign cars account for 41% of Puerto Rico's car imports. German cars jumped from 14,000 to 22,000 in the first six months of this year in South Africa, from 7,700 to 13,000 in Australia. Tiny Kuwait has bought 1,100 German autos.

Even Japan is hustling to get into the race. Though the industry produced only 42,597 passenger cars last year, automakers plan big things. Toyota Motor Co., which makes a sturdy Toyopet sedan (30 miles per gal.) for $2,222, has shipped 800 cars so far this year, including 150 to Hawaii. Japan's other major producer, Nissan Motor Co., with a smaller Datsun sedan (40 miles per gal.) for $1,762, has sent out another 800 to Hawaii and the West Coast. The reception was so enthusiastic that the two companies see a U.S. market of 500 cars a month next year.

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