The Economy: The Rattles in the Engine

• Share

(6 of 10)

As if the consumer did not have enough to be wary about, along came the safety issue. At auto dealerships throughout the country, phones jangle with calls from worried buyers, who ask whether their old cars are safe—and who say that they will put off buying new ones in order to see what safety features the '67s will offer. Detroit has sped up its introduction date of the '67s by one or two weeks, to late September, and most of the models will have such features as collapsible steering wheels. To be sure, the auto industry has its outspoken defenders, among them W. B. Murphy, president of Campbell Soup and chairman of the 100-member Business Council, which advises the Government on business-policy matters. Said Murphy last week of the safety squabble: "It's of the same order as the hula hoop—a fad. Six months from now we'll probably be on another kick."

Beyond question, the auto industry could have done more earlier for safety's sake. Though they spent millions to improve safety, the automakers gave it a back seat to styling because they were persuaded that safety did not sell. They also argued that accidents were caused primarily by bad roads and worse drivers, emphasizing the obvious fact that a driver with five martinis under his belt stands a strong chance of committing automotive suicide. Now, however, the automakers recognize with some pain that safety does affect sales: last week Henry Ford II, chairman of Ford Motor Co., blamed the entire sales slump on the public and political furor about safety. On the positive side, the manufacturers now can be sure that safety features will sell cars from now on. The safety debate has thus performed a considerable service.

Blowing the Whistle. Only a few weeks ago, automakers were still talking enthusiastically about their prospects while dealers were beginning to hurt. Complains a major Midwestern dealer about his unguided missives from Detroit: "The factory says, 'Congratulations, you have just had the best April in Pontiac history!' Well, I just didn't have it, and I can't find any others who did either." When Detroit's sales in April slipped 5% off last year's rates, the industry's backlog of unsold cars shot to a record of 1,582,844 cars, or a 53½-day supply, compared with 441 days at the same time last year. Only then did the industry's controllers blow the whistle on the production men. The automakers eliminated overtime, put some factories on short weeks, and trimmed their second-quarter production plans by 101,000 cars—from 2,553,000 to 2,452,000.