Catching Up with Detroit

WESTERN EUROPE

While the average American consumer is working toward his second and often his third car, most Europeans are still working toward their first. They are working hard: Europe's overall auto sales rose 7% last year, when record years in Britain and West Germany offset slumps in France and Italy. As the annual run of international auto shows began last week in Frankfurt, Europe's 1966 model year headed toward further gains. If, as in the U.S., the new models brought few big surprises, there were striking signs that European automakers are betting heavily on some lessons from Detroit.

Triple Lure. Tens of thousands of auto buffs last week thronged Frankfurt's six cavernous exhibit halls to view the offerings of 69 manufacturers from 15 countries, including those of the big four U.S. auto companies. With scarcely an exception, the foreign firms went all out to adopt the triple lure that U.S. automakers have used successfully for years: more power and luxury features, greater model variety.

Germany's ten manufacturers showed off 30 basic models that come in 155 different versions, all with higher horsepower than before. Notable among them: Opel's completely restyled fastback Kadett, which borrows some of its lines from the Ford Mustang, and NSU's Spider, the only car in the world powered by the Wankel engine. Twelve companies in the U.S., Britain, France, Italy and Japan are now experimenting with the engine (which was developed in 1954 by Felix Wankel, a German engineer). The Wankel replaces conventional pistons and cylinders with a triangular rotor, has only two major moving parts and weighs much less than conventional engines. Other engineering trends showed off: a swing toward a combination of disk and drum brakes even in some of the lower-priced cars, reduction in the number of lubrication points, wider use of double carburetors to provide better fuel mixtures.

Bavaria's Hans Glas, which built its success on the tiny, utilitarian Goggomobil, displayed a flashy new luxury coupe that has the sleek, low lines of Italy's Lancia, does 125 m.p.h. and costs $4,500. Daimler-Benz introduced a new Mercedes, the 250 S, which still bears a strong family resemblance but is longer, lower and rounder. Italy was represented by a glittering array of high-priced Ferraris, Maseratis and Alfa Romeos as well as by the nimble, lower-priced Fiats. As always, the Rolls-Royce exhibit drew large crowds. They may have been looking at a dying swan. The rumor in Britain is that at the London auto show next month the company will unveil a new Rolls with a lower, less boxy profile, disk brakes and independent suspension for the rear wheels.

Escaping Tariffs. In the number of cars produced--if not in profits, quality or technology--the European auto industry is closing in fast on Detroit; last year it turned out 7,545,000 cars v. the U.S.'s 7,745,000. Europe's automakers hope not only to sell more cars at home but to increase exports, on which they depend heavily for profits. Germany produces more cars than any of its neighbors (2,650,000 last year), sells more than half of them abroad. Second-ranked Britain last year exported 36% of its 1,870,000 cars.

Increasingly, companies are developing foreign markets--and escaping high tariffs--by exporting parts, rather than whole cars, for assembly abroad. Britain's Rootes is building an assembly plant in Iran that will produce 5,000 vehicles a year, mostly Hillmans and Singers; British Motors Corp. is readying a plant in Spain with a capacity of 1,000 Mini cars a week. France's Citroen produced 26,000 cars in Spain last year, will double its output by 1967. The most aggressive exporter to underdeveloped markets, especially behind the Iron Curtain, is Italy's Fiat. It already collects lucrative fees by licensing Yugoslavia to produce 40,000 Fiats a year, maintains a sales and service network in Czechoslovakia and Bulgaria, and recently agreed to supply the Soviet Union with technical know-how and parts. Fiat has similar agreements with Egypt, India, Spain, Morocco, Iran, South Africa and Argentina.

Room for Everyone. As competition among European companies has increased, so, paradoxically, has cooperation and consolidation. Volkswagen and Daimler-Benz work together on domestic sales and production problems, are extending cooperation abroad in more than 100 countries. France's Citroen, which absorbed Panhard earlier this year, cooperates with Peugeot in purchasing and production; the two companies are expected to merge completely in two or three years. There is more than enough room in the European market for everyone to grow. In Sweden, Europe's most motorized country, there is one car for every four citizens, in Holland and Italy one for every ten. In the U.S., by contrast, there is one car for every three people.

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