Ceiling for Autos

There will soon be an OPA ceiling on new passenger car prices. That was the upshot of a breezy meeting held this week between OPA's Cyrus McCormick and 81 important auto dealers. But the automen were not worried. The ceiling formulas proposed were satisfactory, and nothing was said about used cars.

Even before the meeting, automobile dealers were a cocky lot. For more than a month they had been dazzled by an unexpected show of Government friendliness. At a series of "informal luncheons" held in a few key cities, OPA had convinced dealers it was on their side in their old, old fight against selling pressure from the factory.

Cyrus McCormick had in effect told the dealers their role in the emergency was to make all the money they could without working too hard. His general suggestions: 1) sell new cars only at full list price, 2) stop overtrading, 3) build up the service end of their business.

Except that he told them OPA would not tolerate deliberate price gouging, Mc-Cormick's advice was just what their own

National Automobile Dealers Association had been telling them and just what they wanted to hear.

OPA had good reason for these how-to-make-money sessions. In automobiles, OPA's biggest aim is to reduce new car sales, thus save materials for defense. That is why it barred brightwork. Now it wants dealers to avoid any price-cutting that would boom sales.

The dealers have been taking the advice. Their patriotic indifference to factory sales quotas is one reason October sales were 39% below last year. But they have been stocking new cars so fast that their inventories are over 300,000 units, a new high for the season. They did this in expectation of a terrific spring demand--a market in which they might get prices above list. Hence OPA's wish to confer with them about a ceiling this week.

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