Tuesday, December 27, 2011

A Promising Auto History Topic -- The Used Car Problem during the 1930s

During the Depression, auto manufacturers and other interests kept pointing to the issue of used cars and how that market was dragging down the numbers of potential new car buyers. It was labeled the "used car problem," and the subject of a considerable body of literature. This topic might be a good term paper or scholarly essay.

Here is one plan posed at the time, taken from a 1938 report on the Automobile Manufacturers' Association in a National Archives file:

"Typical of proposed plans for foreign disposal was one advanced by Lawrence R. Rich, Attorney, Cleveland, Ohio, in February 1938. Mr. Rich proposed that manufacturers purchase from dealers a million used cars of the more recent models. The manufacturers were to turn these over, at loss, to a government-owned or controlled corporation which should sell them at a loss (as the Government's contribution to the plan) to the Russian Government. It was pointed out that then manufacturers would be able to recoup their loss through sales of parts for the cars. The plan was presented to the Export Committee meeting in March at Mr. Rich's insistence but Mr. Bauer said it was not seriously considered because of he many obstacles to such a plan, namely the fact that freight on a used car is the same as that on a new car which makes it high in relation to value, difficulties in connection with valuation for tariff purposes, etc."