Small Cars

Report Outline
Year of Decision for Auto Industry
Reasons for Popularity of Small Cars
Attitude of Big Three Manufacturers
Tentative Plans to Make Smaller Cars
Special Focus

Year of Decision for Auto Industry

Hopes for Revival of Market for Big Cars

A SHARP RISE in sales of Volkswagen, Renault, Fiat, English Ford and other small European cars in the United States, coupled with mounting sales by American Motors of its Rambler lines, have forced the Big Three automobile manufacturers to reconsider their policy of annually increasing the size and price of their product. General Motors, Ford, and Chrysler are making tentative plans to include a small economy car among their 1960 models.

Despite extensive sampling to discover American likes and dislikes in motor vehicles, the manufacturers are still uncertain as to whether there is actually a large and profitable market for economy cars in this country. Frederic G. Conner, board chairman of General Motors, said of G.M.S small car plans on Oct. 13: “We are moving forward but are still weighing the pros and cons. We are taking a hard look at the whole small car idea. All I can say is that we have not yet reached the point of no return.” It is a virtual certainty that if one of the Big Three does go into small car production, the other two will follow.

Final decisions probably will have to be made within a few months. What they will be is likely to depend in large part on the attitude of the public in the meantime toward the 1959 car models. Dealers in every part of the country have reported a brisk demand for the new cars, and the economy of the situation would seem to favor a continuing strong demand. The bumper crop of 1955 models, already paid for, did not show up as anticipated in trade-ins earlier this year. About four million cars have been scrapped during the year. And consumer income has declined only minimally in the now-vanishing recession.