G.M. Speaks Up

After twelve peacetime months in the red, the biggest U.S. automaker finally turned the corner. General Motors, said President C. E. Wilson last week, made a small profit in July, will probably show one for August. But things were far from good. For the year as a whole, G.M. would still be in the red. Charlie Wilson met the press in Detroit's Statler Hotel and told why. His plain talking was characteristic, and significant, for G.M.'s troubles are the troubles of most U.S. mass production industries.

Not till January 1948, said he, could G.M. and the other car makers hope to hit the rate of 6,000,000 cars a year they had expected to reach late this year. (Auto production this week was 76,106 cars, a rate of 3,900,000 a year.) One prime reason: worker efficiency is way down. In 1941 G.M., with 265,000 workers, turned out 55,000 cars a week; now, with 20% more workers, it is making only 25,460. Said Wilson: worker efficiency* was only 80% of its prewar level because of inexperience and workers who 1) feel that they don't have to work so hard any more; 2) fear that with materials shortages they will work themselves out of a job.

G.M. had other serious troubles: strikes in supplying companies, shortages in basic metals--pig iron, sheet steel and especially in lead (G.M. had only enough lead for storage batteries to carry through October).

Whose fault was it? Said Wilson: "If you want me to be real frank, I think it is the Administration's fault." The Government had made three changes in wage-price policies, kept management-labor relations in a state of strikes and utter confusion.

With costs hopping up everywhere, Charlie Wilson had only one solution: raise the price of G.M. cars $100 all around. (G.M. will soon ask OPA to okay this.)

Could the auto market stand such a rise? It probably could, in the present mad scramble for cars. Despite indications that only one in every four orders is a "solid" one, there have been few rejections of cars by customers. Mass turndowns because of price rises seemed a long way off. But many another industry, where the demand was not so great, could not take this easy way out. They had Charlie Wilson's troubles, but could not use his solution.

*In a survey of 1,000 representative manufacturers, Mill and Factory last week found that 55% of them reported labor productivity as less than before the war; another single-industry survey found productivity currently only 65% of prewar.

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