BRITISH CAR PRICES LIKELY TO STAY HIGH

Bay of Plenty Beacon, Volume 13, Issue 38, 7 January 1949, Page 4

BRITISH CAR PRICES LIKELY TO STAY HIGH

(By Reece Smith, New Zealand Kemsley Empire Journalist) Coventry, Dec. 8. Increased production only will bring down the price of British cars. No more steel with which to get this increase is promised or in prospect. Therefore prices are likely to stay pretty well where they are for a year or two yet. This according to executives of one >of Britain’s largest motor groups, at present funning its plant at about 60 per cent capacity through shortage of steel. A pure example of steel's importance in Britain’s economic recovery, and something of, a blow to motorists holding off in the belief that popular car prices cannot remain in the stratosphere much longer. The executives would not name one factor which, more than any other, had contributed to soaring car prices. Labour and.., raw material costs had risen in parallel. Unlike shipbuilders, who confess 1952 will see the end of their boom, the motor industry admits it can only guess as to when the seller’s market will fill ■ up. For the moment every car produced has a buyer waiting, though it is recognised that many order books are padded with orders duplicated on other books. J

Sales organisations complain • their greatest current trials are the fluctuating import policies of so many countries, with New Zealand not the least offender. For the present however, if New Zealand suddenly clamps down on all imports, consignments can easily be diverted to other markets where there is just as ready a sale, and whose money is equally Wtelcome. In several cases British car design has been changed to catch customers addicted to American stylings. At the same time there are ample models on the line, mostly high priced, which are . smoothly modern and evidently British. British manufacturers are split over whether or not their American market has any future. Some say that if American manufacturers, who happen to know their home market, thought Britain was digging a permanent foothold they would swiftly set about eradicating it. A compromise view is that America will always offer some sort of scope for British specialties, Such as sports cars, while American models carry on with the hack work.

At the other extreme are experienced men who hold the whole British motor industry to be on shfting sands, due to be sucked under just as soon as the tide of American production fills the present void. These men say there is no type of car which the Americans, with the infinitely greater production, cannot sell more cheaply than the British if they turn their mind to it. 1

Price will be the first thing to slow down sales. And that leads back to steel, and lack of it.