Television digest with electronic reports (Jan-Dec 1954)

wHh Electronics Reports WYATT BUILDING ^ WASHINGTON 5, D C. • TELEPHONE STERLING S-1735 Trade Bepori December 11. 1954 ) GUT BACK TV OUTPUT? 'LET GEOBGE DO IT!'; "My inventories are clean, but I hear some reports that my competitors are loaded with merchandise. I'm in good shape, so I'm not planning much of a production cutback in the first quarter of 1955. I don't know what the others are planning, but if they're loaded, they'd better cut." That comment from one of top TV manufacturers, elicited this week in response to warning from a leading trade authority last week that current 11,000,000 annual production rate and slowly-rising inventories (now about 2,200,000) contain seeds of future trouble unless production is curtailed (Vol. 10:49), was typical of several reactions from industry's pace setters — all saying, in effect, if there's any TV production cutting back to be done, "Let George do it." Nobody was willing to be identified for the record about his plans for next few months, for obvious competitive reasons — but one very important manufacturer told us he plans to maintain his fourth-quarter production right through the first quarter, rising inventories notwithstanding. He said he'd do so "until there is a clearly discernible fall-off in my set sales at distributor and retail levels." Most other manufacturers we contacted agreed that only modest cutbacks are in prospect for first quarter. This despite fact that first quarter traditionally accounts for but 25% of year's TV sales, contrasted to 40% for fourth quarter. One set maker, saying he planned small output reduction, defended policy thus: "We're purposely building up our inventories a little now because we felt we were too low a year ago. We were actually short of TV sets in the first quarter of 1954, and we don't want to get caught again. Our planning is based on our belief that the good TV market will continue relatively strong early in 1955." ^ ^ ^ Production in first week of Dec, continued at high level, totaling 224,727, up from the Thanksgiving Week output of 173,968 and not far below all-time record 243,703 in week ended Nov. 19. It was year's 48th week and brought production for year to date to about 6,500,000, compared to 6,750,000 in same 1953 period. Radio production was 303,759 (119,858 auto) week ended Dec. 3, compared to 250,519 preceding week and 314,557 week before. For 48 weeks, radio production was 9,400,000 vs. 12,400,000 in 1953. (For story on radio sales, see Topics & Trends.) Retail TV sales continue at a brisk rate, though a gradual tapering off has been noted by trade statisticians since late Oct. peak. Stacked against 4th quarter of last year, sales look especially good — and prospect is that at least 6,800,000 TVs will be sold at retail this year, for all-time record. This would mean about 36,000,000 sold to nation's currently estimated 48,000,000 households in 1947-54. (RETMA this week officially reported 5,444,227 TVs sold at retail in first 10 months, 799,164 of them in Oct., vs. 4,922,128 in first 10 months of 1953.) =1= >i« i* * What's the business outlook for 1955? Economic pundits of all persuasions are coming out with all manner of predictions ranging from business leadeirs' forecasts of prosperity to dire predictions of recession by some union officials. Many forecast a year roughly comparable to 1954. Typical of such "moderate" viewpoints was a noted business letter's outlook for a good business year "but not boomy." Authoritative U.S. News and World Report sees it this way: "A spending mood is taking over again. You find the first signs of it now in an increasing demand for autos, appliances, TV sets, other things. You'll see this new mood spreading as time goes on. It all adds up to a big year ahead for retailers." Wall Street Journal canvassed cross-section of 3000 businessmen attending convention of National Assn, of Manufacturers this week, found them anticipating tough, competitive year, with sales equalling or barely exceeding 1954. 11