Drawings of a prototype commuter car and the GM J-car by Larry Tople and a photograph of the Ford Erika that accompanied an article on the auto industry in yesterday's Washington Post were reproduced by permission of Car and Driver magazine. Credit was inadvertently omitted.
Detroit has always enjoyed fooling the American public, and the public has always enjoyed being fooled. This waa an axiom of the good old days in the auto industry, and a reflection of the fact that Americans are not always rational about cars.
Take, for example, the Cadillac Seville. According to John Z. DeLorean, a retired General Motors executive, the 1975-79 Seville "was essentially a very heavy, beefed up [Chevrolet] Nova." General Motors made several thousand dollars of clear profit on each of the Sevilles it sold.
When he was running GM's Chevrolet division in the early 1970s, DeLorean found that a Chevy Caprice cost $300-$400 less to build than a Cadillac DeVille, but the DeVille sold to the public for $3,800 more.
Ford's Granada, which was introduced in 1974 with ads comparing it to a Mercedes-Benz, actually consisted of a new body atop the innards of the old Ford Maverick.
Gimmicks like these helped Detroit make a lot of money. Traditionally, the industry sold small cars at small profit margins, counting on those Cadillacs and other big models to earn the real profits. In fact, a customer who today buys a stripped-down Ford Pinto is probably costing the Ford Motor Co. money. Add some of the accessories that most Americans seem to prefer, and the car becomes profitable -- but only marginally.
One aspect of the coming revolution in the auto industry is the strain it will put on traditional buying habits. For many, as Lee Iacocca of Chrysler has put it, buying a car is a personal statement. But as big, eight-cylinder cars disappear (and eight-cylinder engines will not survive the '80s), people are going to have to accept new kinds of cars to make those statements for them.
Detroit hopes and assumes that one of the laws of the business will remain immutable: that 60 percent of the public will continue to stick loyally to a single American make. According to marketing executives here, such loyalty takes much of the anxiety and cofusion out of buying a car.
The marketing men have a small anxiety of their own: that the current rush to small cars just might not continue. Who's to say that Americans won't get used to $2 gasoline and decide they still want relatively big cars.
"The milkman in Kansas City still dreams of a full-sized Cadillac," a marketing executive at GM observed.
But, of course, Kansas City milkmen are a small portion of the car market. The younger Americans who have fled to foreign makes in droves are a much bigger part of the market, and Detroit has no clear strategy for bringing them back to American-made cars.