The Market for Automobiles

Report Outline
Involved Projects for Automobile Sales
Growth of the Automobile Industry
The Motor Vehicle Export Market
A Market Approaching Stabilization
Special Focus

Involved Projects for Automobile Sales

Automobile manufacturers are now preparing plants for the introduction of new models later in the fall. Thus far, 1938 has been one of the poorest seasons in the recent experience of the industry, with registrations of new passenger ears and trucks in the first six months almost exactly 50 per cent below the corresponding period in 1937. The total number of new vehicle registrations from January through June was the smallest since 1933. However, new car sales showed a contra-seasonal increase for July over June, and a number of factors provide a more favorable outlook for the future.

Aside from the general improvement in business conditions, the chief reason for optimism is a marked reduction in dealer inventories, both of new and used cars. On August 1, according to Ward's Automotive Reports, dealers had approximately 210,000 new cars on hand, or an average of about six per dealer. This represented a decrease of 60,000 units during July, and Secretary of Commerce Roper has estimated that August figures will show a further decrease of 80,000 units, leaving dealers with an average of four new ears each on hand. Inventories have been reduced steadily since last December, and factories which have recently been partially or completely out of production are resuming activities. However, there was a sharp decline the last week in August, due to closing of the Chevrolet plant.

The National Automobile Dealers Association states that on August 1 dealers reporting had on hand an estimated 37-day supply of new cars, and a 44-day supply of used cars. There was a noticeable stiffening in the price of used cars, leading naturally to an improvement in prospects for the new car market.