Ford opens fire
After a period in the doldrums, the world's car makers had a good year in 1963. Just over 1,600,000 cars left British motor plants, a quarter of a million more than in 1960, the previous record year.
The pattern was the same in other countries, some doing better than British manufacturers, others not so well. German output went up to about 2,500,000, French to almost 1,500,000, Italian to 1,100,000. In the United States, the biggest producer of all, over eight million cars left the assembly lines.
Exports generally followed the same trend. British sales abroad totalled over 600,000, French a little less than this, whilst Germany disposed of more than a million.
The demand for cars continues very strong. But supply, and more important, capacity to supply, is rapidly catching up. Over-capacity has probably already been reached in the British industry, and cannot be far behind in most of its competitors. The result can only be more and more hectic competition, and this has already announced itself.
The first shot has been fired by Ford, who have cut the price of their Anglia by £30. This brings it well below the price of its more comparable competitors, the Vauxhall Viva and the Hillman Imp, and only about £30 above the B.M.C. Mini-Minor. But the latter is already well down to a price which leaves little scope for further cutting, and the two others have still to repay the high cost of their new plant.
All of them will probably be able to take care of themselves during the high demand of the spring and summer, but there could well be the first nasty crunching sound sometime about the autumn when sales normally turn downwards. The managing director of Fords has made no secret of their intentions. He told the Sunday Times motoring reporter quite bluntly a little while ago—“We are setting out to get a bigger share of the small car market, and we shall get it. Wc don't mind where the biggest share comes from just so long as it comes to us.”
Ford are probably in the best position to make the running. With a £35 million profit in 1963, and the big reserves of their American parent behind them, they could no doubt afford to take a lower profit, perhaps even no profit at all on a model like the Anglia, most of whose tooling costs must have been well written off by now.
The same thing will be happening abroad before long. What with competition between private firms at home, and a free-for-all between countries on the international field, it looks like developing into a very interesting situation.
The biggest of them all
Whilst on the subject of cars, let us not forget the biggest maker of them all — General Motors of America.
They also had a good year in 1963. Their workers produced almost 5 million vehicles, more than the whole of British and German production together. Of these, more than a million went for export.
General Motors, of course, make lots of other things besides cars. From all their activities they did more business and made more profit than any other firm in the United States and probably in the world. Total sales in 1963 amounted to the colossal figure of between 16 and 17 thousand million dollars (almost £6.000 million) and their profits to 1,500 million dollars (about £500 million).
No wonder somebody once said that “What's good for General Motors is good for America." For American capitalism, of course)
And one quite small
Still to do with cars, we like the report in the Economist recently to the effect that the Italians have just closed their frontiers to imports of Soviet cars. These cars are not apparently assembled in Russia, but exported in pieces to Belgium and distributed from there (Belgium, although it has no car industry of its own, has in fact become the biggest assembler of foreign cars in the world).
It must be quite a sight to see all those bits and pieces coming in from so many places—Standard-Triumphs from “free enterprise ” industry in Britain; Renaults from a nationalised industry in France; Moskvitches from state-capitalist Russia. Wc get to sec everything in time.
Stan Hampson
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