Motor Industry

The motor industry, generally speaking, is in the position of a squirrel in a cage. So far as profits go--it is very active but dubiously profitable. Production of cars proceeds at a good rate, but competition has so reduced retail prices that there is little satisfaction in it all.

Two of the leading manufacturers have recently precipitated more trouble by announcing further price cuts. This occurrence has thrown quite a blight over the plans of many car makers to raise prices next season to a point where larger profits, could be seen in the business. Instead, the coming issue will apparently be the survival of the fittest, with the probability that weaker concerns will either retire or consolidate.

Two factors, however, will govern the extent of this prospective elimination of the smaller car manufacturer. There will always be room in the industry for makers of specialty cars, who do not compete in the more standardized field. Secondly, a weak company today may nevertheless bring out next season's most popular car and put itself in a stronger position. The great success this year of the Chrysler car has done just this for Maxwell. On the other hand, the strong companies must each year bring out very appealing new models or lose their position in the industry, as Studebaker has discovered. The competition in the motorcar business is concerned not only with prices, but also with styles and fashions.