Compact's Impact

Every automan knows that the compact cars have boosted overall auto sales, but no one has been sure just what effect they have had on the market for standard-size cars. Last week Detroit had enough figures to show that the compact has been an unreserved blessing for some, a mixed blessing for others. Imports were feeling compact competition, were down from 11.5% of car sales in August 1959 to 8.7% last month. Items:

P: Ford's Falcon, bestselling of the Big Three compacts, seems to be feeding off the regular-size Ford market. Ford's sales in January and February totaled 223,000 cars, up 3,000 from 1959's first two months, but 69,000 of those sales were Falcons. Result: sales of the regular Ford fell from 209,000 cars in January and February of 1959 to 143,000 this year. The Falcon now accounts for 33% of the Ford division's business.

P: Chevrolet's Corvair, though not making the impact of the Falcon, appears to have found a new market all its own. In January and February last year Chevrolet's sales totaled 230,000 cars; this year it has sold 267,000 cars, but only 35,000 of them were Corvairs. Thus, the regular Chevy is selling at about the same rate as last year, while the Corvair, accounting for 13% of the division's sales, is all extra business.

P: Chrysler's Valiant is selling well, but comparisons have been thrown out of kilter by the surprising success of the company's middle-size Dart, which now accounts for 85% of the Dodge division's sales. For Chrysler Corp., this means an expansion of its market (its sales are up 48% over last year, when a glass strike crippled production), but it also means headaches for Plymouth. Many Plymouth customers are switching to Darts, buying them so fast that last month the Dart actually outsold the Plymouth, onetime mainstay of the company.

Although overall car production this week is scheduled for 9% above last week, some plants, e.g., Buick, Plymouth and regular-size Ford, have trimmed production. Since the end of the steel strike, factory output of cars has been too high even for sales running 12% ahead of last January and February. Dealer inventories are about 950,000 new cars, more than a 50-day supply, compared with the 44.4-day supply at this time last year.

Despite this, Detroit's sales projections for the year took on a firmer though by no means unanimous tone. Ford now expects a 6.6 million-car U.S. year, including 500,000 imports. Said Chevrolet Boss Ed Cole, just back from a two-week nationwide tour of dealers: "I am sure that 1960 will see sales in the U.S. in the area of 7,000,000 cars." American Motors' George Romney. whose plants are running round the clock to meet orders, still stuck to his prediction that car sales will run between 7,000,000 and 7.5 million this year--and that one in every three sales will be a small car.

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