Second Thoughts at Ford

Only a fortnight ago, Ford Motor Co.

publicly conceded that it was gearing up for mid-1962 production of the U.S.'s first "compact compact," the 99-in.-wheelbase Cardinal, thereby confirming what Detroit gossips had been saying for months (TIME, March 9). But when Ford at the same time warned that "changes in market conditions may cause these plans to be altered," it was not, as many thought, indulging in idle talk. The fact is that Ford is having long second thoughts about the Cardinal, may well decide not to produce it in the U.S. at all.

What worries Ford is that U.S. auto buyers have recently shown a tendency to switch back from small economy cars to the old standard or medium-priced models.

U.S.-made compacts, which captured a record 38.4% of the auto market last August, hold only a 33% slice of it so far this year. Meantime, overall sales of small foreign cars, with which the Cardinal would directly compete, have shrunk to only 3.9% of the market--and in this area the dominant position is held by Volkswagen, which Ford regards as an uncommonly difficult competitor to dislodge. Beyond this, Ford fears that the Cardinal might make many of its sales at the expense of the Falcon, just as the Falcon ate into the Galaxie's sales and the new Fairlane has cannibalized both the Falcon and Galaxie markets.

Ford is still suspending judgment on whether to produce the Cardinal in the U.S. But if the switch to bigger cars gains any more momentum, the company will almost surely cancel its plans to assemble Cardinals in Louisville, Ky., and instead satisfy whatever U.S. demand there may be for the car by importing the two European versions, which are to be produced in Britain and Germany. Probable date of the final decision: some time before early summer when, in order to include a U.S.-made Cardinal in its 1963 line, Ford would have to okay parts production by suppliers.

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