STATE OF BUSINESS: Trouble in Detroit

The gloom, that has encompassed auto dealers around the country for several months settled in Detroit last week. This time it was not just the independents who were being hurt. Chrysler Corp., hard hit by the slow cleanup sale of its 1953 cars, laid off some 9,200 workers. Nash has already announced an eight-day shutdown to help dealers trim inventories; Studebaker is shut down until early next month; Hudson and Packard cut their work forces. Still unaffected are General Motors and Ford Motor Co., both of which are planning higher output of their cars in the first quarter of 1954 than in the same period of 1953. The Ford-Chevrolet race for supremacy appeared to be starting its second lap, and Buick, planning a 10% increase, was gunning for Plymouth’s third position.

What worried automakers most was the fact that price-shaved 1953 cars were competing with new models on many showroom floors. Two months after the 1954 Dodges came out, dealers still had new 1953 Dodges on hand. Total number of unsold new cars in dealers’ hands on Nov. 20 was 559,000, highest in history for that time of year. Unless most of those are sold, the auto industry will fall short of its expected sale of. 6,000,000 cars in 1953; even worse, it might slow down sales of 1954 models next year.