A New Era

Northern Advocate, 31 October 1936, Page 3 (Supplement)

A New Era

British Industry

STABILISED PRODUCTION

The displacing of annual models by series models in the British Motor Industry. was dealt with interestingly recently in an article in the “Manchester Guardian.” The writer said that the magnates of the industry carried an enormous responsibility for the financial interests of their shareholders, the welfare of many thousands of employees, satisfaction of customers, prosperity of British trade in gerferal, and the supremacy of the British motor industry in particular.

“Those of us who have been interested in motor-cars for a quarter of a century can recall many concerns which have passed through the wildest vicissitudes; in spring it has been impossible to obtain delivery of their products; by autumn their directors have almost knelt to their bankers and the local rate collector for a couple of months’ respite. “Such anxieties were largely based in the past on the fact that design was fluid.' The next season models of all factories would show radical changes from the current model. Popular taste was fickle, though popular judgment was generally sound. A manufacturer might enjoy an almost crazy success one year, hitting the bull with his ranging shot at public taste. Next year he might score an outer, while two of his rivals, helplessly outclassed twelve months before, pierce the centre of the target. They would steal the bulk of his customers, and his own stuff would be almost unsaleable.

“The merging of many small firms into a few large firms, the expansion of petty plants into gigantic enterprises, and the advent of large-scale “flow-production” made matters worse for the moment. The manufacturer could no longer feel the public pulse by timidly launching 500 cars, and hastily telegraphing to all his suppliers to multiply their contracts by ten, fifty, or one hundred if the trial balloon soared nicely.- He was compelled to decide in advance how many cars he was going to budget for. There was no time, to let his agents sample the proposed design, still less to gauge public opinion amongst consumers.

Both the price and the specification depended to an astonishing degree on how many chassis he resolved to build. Against each chassis he had to allot so much for advertising, so much for machine costs; and when he placed contracts for components manufactured outside —carburettors, tyres, magnetos, and a host of lesser oddments —the contract price varied according as he ordered 5000 or 50,000. The whole process had become overwhelming. The men who have weathered years of controlling vast plants have developed a judgment of the finest quality. The penalty of a serious blunder was always to se their capital dissipated like a morning mist, their key men fleeing as rats desert a sinking ship, their labour unemployed or absorbed by their rivals, and the whole edifice of their life in ruins round their feet. “Their chief concern was, of course always that whimisical and coquettish factor, public taste. But public taste is not even a unit. Some of it values acceleration, speed, and a semi-sport-ing appearance. Some of it places comfort first. Some customers demand sheer reliability and extreme durability. Some consider* looks before almost anything. The day came when women began to own and drive in large numbers. As long as design was really fluid, guesses at public taste were always liable to miss the mark; at least one firm planted its feet on the ladder of fame and fortune simply and solely because it chanced to manufacture a saloon body which most people thought was far nicer than any rival.

“Again, a single accessory might abruptly cut sales by thousands. One year a large manufacturer decided that one of his sub-contractors was making too much profit on a component. He bullied the firm into cutting their price heavily; they retorted by reducing their quality. This component gave incessant trouble cn the first few thousand cars, and the make consequently acquired a poor reputation for reliability, so that many old customers switched to a rival make next autumn.

“However, these convulsions are slowly ending, and a more peaceful era has opened. Design has become stabilised. The costing processes associated with flow; production are by now well understood. Each big manufacturer has a network of agents who possess something approaching a stranglehold on his local clients. The new-season model has ceased to differ at all fundamentally from its predecessor. The sales manager can estimate within comparative narrow limits how many cars he is likely to sell within the next twelve months. He can budget for a large output, perhaps a fantastically large output in any case; and there will be plenty of time to make any small adjustments as he

watches the reception of the early cars in the batch.

“So at long last the ‘annual’ model policy is surrending to the ‘series’ model. A maker can lay down 10,000 of a model secure that they will all sell. If it proves a goldmine, and no essential conditions alter, he can double or treble the size of the ‘series.’ We begin to see an end of the old mad scramble in which every maker tried to snatch a week from his rivals in announcing next year’s car and to coax buyers by some cut in price or some work novelty. The industry is becomadditional equipment or some coaching stabilised on a basis of low price and sound value.

“The system of superseding ‘annual’ models by ‘series’ models incidentally benefits the workers in the factories. Thus, under the old system one famous British factory showed a percentage of production for the four quarters of a working year as 26.6, 30.2, 30.9, and 12.3, instead of the ideal regularity of turning out 25 per cent, of its total output of cars each quarter. There was a marked degree of ‘seasonal unemployment’ during the slack quarter, while 467,000 hours of overtime were registered in the busy quarters. Under the ‘series’ system the quarterly percentages of output approached the ideal of 25 per cent, much more satisfactorily, the actual figures being 21.6, 29.6, 25.4, and 23.4, whilst the hours of overtime sank to 267,000, a reduction of nearly 50 per cent. Moreover, since the entire staff were kept busy on a basis of 40 hours a week, a large number of additional workers secured employment of a regular character.”