Word: detroits
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Dates: during 1970-1979
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...unsold cars. To get sales rolling again, the industry is now taking two expensive gambles. By the end of this month it will have spent millions in a program of cash rebates - ranging from $200 to $600 on selected models - designed to lure reluctant buyers. For the longer term, Detroit is committing billions to an overdue drive aimed at developing and producing whole new families of cars that will be far lighter, smaller and more economical to operate than practically any of the present models. Says Gerald Meyers, product group vice president at American Motors: "Hell, the people have been...
...sales upswing has pulled thousands of cars out of the vast Michigan State Fair grounds outside Detroit, which until recently was covered bumper to bumper by part of Chrysler's stock of unsold cars. Chrysler's backlog has dropped from 350,000 to 300,000. Some models have been in especially heavy demand. Orders for Ford's sporty German-built Capri, which lists at a basic $3,566 and carries a $500 factory rebate, have been so great that dealers are scouting round the U.S. to find cars and are warning buyers that they may have...
...risk Detroit is taking is that the public's car-buying fever will cool rapidly after March 1, when all the rebates will have ended. Moreover, says David Eisenberg, auto analyst at the Wall Street brokerage house of Sanford C. Bernstein & Co.: "If the programs are tremendously successful, it could well mean that Detroit is borrowing sales from future months." Eisenberg believes that if post-rebate results are disappointing, the automakers will probably have to cut prices permanently, even if that means they will have to swallow losses...
...Detroit lose its grip on the buying public? Last winter's Arab oil embargo "hit us right between the eyes," says GM Chairman Thomas A. Murphy. Consumers are still confused about what the energy crisis might do to gasoline prices and availability in the long term. At the same time, inflation has wiped out more than 5% of the public's purchasing power over the past year, while rising unemployment has also cut deeply into sales. The jobless rate stood at 7.1% in December, and it may turn out to be close to 8% for January, when...
...Detroit's basic trouble runs deeper and has been building longer than either the energy or the economic crisis; it is simply that the auto companies, rightly vaunted for their marketing skills, have failed in recent years to grasp and react swiftly enough to the changes taking place in their market...