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Report from the Editor

General Motors Corp. accomplished something in the first 10 days of May that no other automaker has been able to accomplish since the heyday of the Model T.

by Roy Wiley
June 1, 1962
Report from the Editor

 

3 min to read


General Motors Corp. accomplished something in the first 10 days of May that no other automaker has been able to accomplish since the heyday of the Model T.

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The giant automaker, which has been breaking sales records with monotony this year, accounted for 61.6 per cent of all the cars sold in the May 1-10 period. The performance-spectacular even for GM-marked the first time that the company's market penetration ever topped 60 percent, or three-fifths of the U.S. market, and bettered the market penetration of the Ford Model T set in 1921.

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Immediately after the sales figures were announced, the hue and cry went up "to break up General Motors." Many of those who joined in the chorus were the same bleeding hearts who a few years ago blasted Detroit for producing cars that the consumer didn't want-the same people who are now being proven wrong by the functional cars rolling out of Detroit.
I'm against breaking up General Motors. While I don't necessarily believe that "what's good for GM is good for the country," I feel that breaking up GM would accomplish little more than to increase the federal government's already-too-big role in private enterprise. If there wasn't a GM, there would be another giant-a Ford or a Chrysler.

Actually, since the departure of George Romney from the auto scene, there is really little concern in the auto industry about GM's bigness. Romney, while president of American Motors, declared that no automaker should be allowed more than 35 per cent of the market. Most auto executives that I know will admit privately that GM usually has it over them in some are-styling, engineering or merchandising, but never in all areas. They say that it's a rare phenomenon that GM has everything going for them this year. "Wait until next year," is their answer.

Ben Phlegar, noted Associated Press writer, recently quoted Henry Ford II, chairman of Ford Motor Co., as saying that GM was entitle to every sale it could make, adding candidly, "they are damned tough competition." While the auto industry is not overly concerned with GM's bigness-other than finding ways to beat them down-the federal government is.

It is common knowledge that the justice Department has a special investigating unit formed with the intent of breaking up the nation's largest manufacturing company. Pending federal suits already accuse the automaker with attempting to monopolize the manufacture of buses and diesel locomotives. Another suit seeks to void its purchase of the Euclid Road Machinery division. Other grand juries have sifted through activities of the AC Spark Plug division and of General Motors auto sales tactics. A bill pending in Congress would put GM out of the car financing business. And Chevrolet, the kingpin of GM, was indicted last year for allegedly conspiring with two California dealer associations to stop the sale of Chevrolets by discount houses.

This government probing has upset GM officials. The company never announces its sales or earnings--$374,000,000 net in the first quarter-as records. It just releases figures. The government probing should also upset other businessmen. Nothing can do more damage to the American economy and way of life than government intervention.

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As Thomas Babington once said: "Nothing is so galling to a people, not broken in from birth, as a paternal government or, in other words, a meddling government, a government which tells them what to read and say and eat and drink and wear."


Topics:Operations
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