AUTOS: Used Cars Wanted

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Only eight months ago used-car lots in many sections of the U.S. were packed with unsold cars on which the prices were plummeting. In San Francisco one dealer surveyed his bumper-to-bumper lot and wailed: "This is the first time a customer can buy a one-year-old car at 50% of its cost when new." But by the end of July the whole picture had changed to what the Automotive News called a used-car shortage of "near-drastic proportions." Accordingly, prices were rising.

In Chicago last week, dealers were dropping "Used Cars Wanted" signs into their showroom windows; in Seattle, Dallas, Omaha and Detroit, salesmen were unable to satisfy consumers' demands for good '53-'55 models. The National Automobile Dealers Association estimated that U.S. used-car inventories, from "creampuffs" to "dogs,"* were one-third below normal.

One reason for the scarcity was the fall-off in new car sales (down 12% from a year ago), which meant fewer trade-ins. But another factor was the growing demand, especially in the suburbs, for two (or more) cars in every driveway. Said a New York dealer: "Seems like everybody in the family wants a car these days."

Competing with the used-car dealers for choice '53-'55 models are new-car dealers, who, instead of placing their trade-ins at wholesale auctions, are selling them in their own lots to make up for sagging new-car profits. A good used auto often brings a dealer as much profit as a factory-fresh '56 model. Said one Boston Ford dealer: "You take a car that we buy for $1,000. We fix it up a bit, then sell it for $1,200 to $1,250. Our profit runs $100 to $150. That's about as good as we've been doing on our new cars."