Reason & Realism?

As American Motors unveiled its first compact convertible at its 1961 auto preview last week, President George Romney announced another innovation that rattled the U.S. auto industry. In a direct challenge to one of Detroit's most hallowed traditions, American Motors will make no more annual model changes in its hot-selling (26% of Rambler sales) Rambler American, which has been restyled for 1961. Romney, also promised no ''abrupt or whimsical" changes in other models.

"Forced obsolescence has worked the greatest depreciation of the car owner's investment." said Romney. "And it has become owner's become one of the most expensive factors in manufacturing cost and product quality. In the superficial change process, it is difficult to escape a sense of appalling waste. Refreshing change is one thing, but incessant change has a touch of idiocy.''

Romney hit at the "common contention that change beneficial or not.'' increases sales volume by forcing buyers into the market more often. That may have been true in the industry's earlier days, he said, but today things are different. Because more Americans can now afford new cars, total car volume is less dependent on the waning used-car market. New cars now last longer, require less maintenance cost; with more two-and three-car families, the depreciation costs run so high that owners keep their cars longer. Result: auto volume is "geared more closely to scrappage rates, population increases and the growth of the economy as a whole." The prophet of the compact car, Romney also predicted that in the 1961 model year, compacts will account for half of all new car sales -- and that Rambler's 1961 sales will jump more than 26%. "The era of the dinosaur* in the auto business is drawing to a close," he said, and so is "unbelievable waste and ostentation in the most important and most conspicuous product of our economy." To Crusader Romney, the shift meant not only a turn to function instead of frills, but a sign that the national psychology is leaning to ward "reason and realism."

The sort of model changes that Romney approves of were announced last week by Volkswagen, partly in answer to the success of the U.S. compacts. The 1961 Volkswagen has 27 changes, mostly mechanical, but few of them are obvious to the eye. Engine power has been boosted to 40 h.p. from 36 h.p., and the Volks has a new carburetor, a new automatic choke and a bigger luggage area. Unlike Detroit. Volkswagen makes its mechanical changes throughout the year, has yet to make a major model-styling change on what is essentially a 1938 design.

* Romney enjoys cluttering his desk with model dinosaurs to illustrate his point that big cars are outmoded (see cut).

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