ON CREDIT

Wanganui Chronicle, Volume LXXXIII, Issue 19784, 7 March 1927, Page 9

ON CREDIT

PART-PAYMENT PLAN WORKING OF SYSTEM IN U.S. Is payment by the instalment plan economically sound? Has Ihe instalment system reached danger-point in the United States, and will it not help to precipitate a general slump when hard times arrive? Those matters were discussed exhaustively by members of the World Transport Motor Congress, in New York. It is admitted that 75 per cent of the motor cars sold in the United States arc sold on credit, and that the system entails the existence of 300 financial concerns specialising in the part-payment plan and financing through the assistance of banks. It was authoritatively stated that of the total income of the United States only 11 per cent, related to purchase by the purchase plan, and the category included almost everything saleable, including land. As to radio sets, pianos, mangles, vacuum cleaners, and other “straight merchandise,” the figure is 4 per cent., while two per cent, only represents automobiles. These statistics, it was contended, must convince the pessimists that they are wrong. It was . admitted that without mass consumption there could be no mass production, and without mass production it was suggested that America would be in rather a poor way. The instalment system of payment reached the peak in 1925, but it is expected that the total for 1926 will be just as high. Leaders in the trade predicted a glorious future for the automobile industry and “international peace;” to quote Mr. Charles Clifton, tho president of the National Automobile Chamber of Commerce, “The spread of good roads makes for good business and the peace of the world.”