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Car Forum / Antique and Collectibles / Studebaker / August 2006Packard bought Studebaker?
Wikipedia (on-line encyclopedia) says "Acquired in 1954 by Packard Motors Company of Detroit, Michigan, Studebaker became a division of the Studebaker Packard Corporation from 1954 to 1962. In 1962 it reverted to its previous name, the Studebaker Corporation." I always thought it was the other way around-- does Wikipedia need a correction? thanks, Jim Packard had the money. South Bend had the larger customer base and, now, had a full line, even if the "Pachard" cars were "dealer commitment" cars. That's the legal way it happened. Karl j...@tracksidephoto.com wrote: > Wikipedia (on-line encyclopedia) says "Acquired in 1954 by Packard > Motors Company of Detroit, Michigan, Studebaker became a division of [quoted text clipped - 4 lines] > > thanks, Jim > Packard had the money. South Bend had the larger customer base and, > now, had a full line, even if the "Pachard" cars were "dealer [quoted text clipped - 11 lines] > > > > thanks, Jim >From my recollection, Karl's assessment is correct. Being a teacher of Business and History, Karl's explanation fits the meaning of the business term: Merger. Ergo, Jim, I think you would be correct in setting Wikipedia straight. Just my 2 cents worth. FlatheadGeo Wikipedia has it correct, Jim. Packard bought Studebaker. Financially, Packard was the stronger of the two and really was hoodwinked by the bean-counters that [mis]represented Studebaker's financial condition. Bob Palma > Wikipedia (on-line encyclopedia) says "Acquired in 1954 by Packard > Motors Company of Detroit, Michigan, Studebaker became a division of [quoted text clipped - 4 lines] > > thanks, Jim Packard was the healthier of the two as everyone has said so far. Some unusual dynamics set the merger in motion, and this is a possibly oversimplified thumbnail sketch of the situation that brought the two unlikely partners together. Packard in the 1950's had become totally reliant on Budd for it's bodies. In 1953, Chrysler bought Budd. In 1954, Chrysler notified Packard that Budd would no longer supply bodies to Packard as of 1956. Packard was healthy, but not healthy enough to build it's own spanking new body plant. There was no viable independent alternative source for Packard bodies. Investment bankers and investors saw underutilized body making capacity at Studebaker, so the idea for the merger was born. Intentions during the merger were to build real Packard bodies in South Bend. Those never came to realization because of financial constraints. Packard did purchase Studebaker. But Studebaker held the trump card in the fact it could build bodies. Wikipedia is correct. The whole thing was kind of a shotgun, flip-flop wedding that helped neither side. > Wikipedia has it correct, Jim. Packard bought Studebaker. Financially, > Packard was the stronger of the two and really was hoodwinked by the [quoted text clipped - 9 lines] >> >> thanks, Jim I hadn't heard the Budd part of the story before. So in a manner of speaking Chrysler helped kill Packard? Jeff DeWitt > Packard was the healthier of the two as everyone has said so far. Some > unusual dynamics set the merger in motion, and this is a possibly [quoted text clipped - 30 lines] >>> >>>thanks, Jim must have been the diamler benz part! they were still po'ed after the war! <G> Jim Turner or: We have the Avanti because of Packard. Not a bad trade off if you ask me! > I hadn't heard the Budd part of the story before. So in a manner of > speaking Chrysler helped kill Packard? [quoted text clipped - 35 lines] > >>> > >>>thanks, Jim > Packard was the healthier of the two as everyone has said so far. Some > unusual dynamics set the merger in motion, and this is a possibly [quoted text clipped - 4 lines] > In 1953, Chrysler bought Budd. In 1954, Chrysler notified Packard that > Budd would no longer supply bodies to Packard as of 1956. It was not Budd that supplied bodies for Packard; it was Briggs. Walter O. Briggs died in 1952, and the family wanted to sell out. On October 23, 1953, Chrylser bought all 8 Briggs body plants. Packard was able to negotiate a 5-year lease for the Conner Ave. plant with an option-to-buy, but they could not afford it, so as you said, the merger with Studebaker made some sense at the time. If you are able to pick up a copy of The Fall of the Packard Motor Car Company by James A. Ward, (ISBN 0-8047-2457-1) do so. Its good insight as to how the events worked out for Packard in the postwar years. Craig Thanks for the assist Craig. Not bad memory on the years. Messed the name up on the body company I know there's been some hard feelings by Packard purists over the years toward Studebaker. Despite being in the black financially, Packard was officially finished as of 1956 if the S-P Merger would not have taken place. Was the move to buy Briggs a calculated way to get rid of Packard? I've never seen it debated. Chrysler again played the role of spoiler in 1987 with the AMC acquisition. If Chrysler was the villain, it's been paid back in full since Day One of DCX in 1998. >> Packard was the healthier of the two as everyone has said so far. Some >> unusual dynamics set the merger in motion, and this is a possibly [quoted text clipped - 17 lines] > > Craig > Thanks for the assist Craig. Not bad memory on the years. Messed the > name up on the body company [quoted text clipped - 5 lines] > > Was the move to buy Briggs a calculated way to get rid of Packard? I would say no to that. Tex Colbert from Chrysler was at least willing to give Nance the option to lease it for the first five years, which was the cheapest option for Packard to buy time. With Colbert in control, he could have done nearly anything, from forcing Packard to buy the Conner Avenue plant immediately, putting further strain on Packard financially, to selling the body dies alone and force Packard to build their own new building. Remember Packard already spent a pile of money tooling up for the new V-8. Other factors were against Packard (and all the other independents) such as the bad 1954 sales year. But again, its debatable about how long Packard would have lasted by itself as the Packard division did show a profit in 1955, and just may have given the bankers some confidence if it was still on its own without Studebaker. One of those 'we will never know' things. Craig I've > never seen it debated. Chrysler again played the role of spoiler in 1987 > with the AMC acquisition. If Chrysler was the villain, it's been paid > back in full since Day One of DCX in 1998. > > Thanks for the assist Craig. Not bad memory on the years. Messed the > > name up on the body company [quoted text clipped - 20 lines] > > Craig Craig is right on that. I had posted this on another topic and just a little more food for thought. Read the book,"The rise and fall of the Packard Motor Car Company" 1. Nance was in South Bend in 55 and 56. 2. AMC wanted to use the Studebaker V-8 and Nance said no, then wanted to use the Nash six for cars and AMC said no. There was to be a sharing of parts but it only went one way at first then not at all. 3. Packard sales collapsed in 56 by 67% over 55. 4. The companies may have made it if they had one or two more years to work it out. 5. Packard sales dropped from around 90,000 in 53 to 28,000 in 54. Studebaker 150,000 in 53 to 85,000 in 54. What most people do not realize that all the seeds of doom were planted in 1950 when all the independents share was at 15% of the market. There was no need seen to merge then as Studebaker had it best volume year ever. In 1953 two things happened. The first that gets all the attention is the volume production between Ford and Chevrolet. The second thing that happened is the Fed tighten up money supply in 1953 and did not loosen up to later in 1954. The end result was all the independents saw market share drop to less than combined 7%. Look at the housing market now. Fed has increased the interest rate for the past 18 months. Granted there was investor money that fueled the increase in prices that has now disappeared, but people are not in a hurry to buy, except in certain markets such as Texas right now. The refinance boom is over also for the time being except for people needing cash out from the high equity in there home. Bob Miles Tucson AZ Little more insight: I think there was a desire at Chrysler in the middle 50's to get rid of Packard in hopes that the newly independent Imperial Division could win over former Packard buyers. Chrysler knew the 55 Imperials couldn't steal Cadillac sales so they hoped to get Packard and Lincoln sales. Then when Packard looked like it had a chance of turning around under the new leadership of James Nance they knew they needed to do something. It just happened that the Biggs family wanted out of the body business, so if Chrysler bought them then they could axe the supply of bodies to Packard. Had this not happened Packard would have been able to introduce the 55 models in 54 as it had originally planed. The 55 Packard would have sold very well in 54 with all the boring cars of Chrysler and Lincoln. But the body plant fiasco required Packard to hold off until 55 for the restyle. All of the confusion of moving production caused an inevitable drop in quality. This led to lots of prospective 56 Packard customers leaving for Imperial and Lincoln. Then with the introduction of the 57 Packardbakers the remaining Packard customers flocked to the all-new 57 Imperials. They soon realized that the poor Packard quality in 55 was no worse than the rotten quality of all 57 Chrysler Products. This is why Imperial showed a big gain in 57 only to loose all those Packard customers to Cadillac in 58-59. Chrysler sealed their fate as a solid #3 when they blew off the offer to buy Packard in 55 and again in 56. Without the high margin luxury division to justify new technology Chrysler never had a chance in the long run. That's why we have Diamlerchrysler today! At least that is my opinion! > Wikipedia (on-line encyclopedia) says "Acquired in 1954 by Packard > Motors Company of Detroit, Michigan, Studebaker became a division of [quoted text clipped - 4 lines] > > thanks, Jim Chrysler sealed their fate as a solid > #3 when they blew off the offer to buy Packard in 55 and again in 56. > Without the high margin luxury division to justify new technology > Chrysler never had a chance in the long run. That's why we have > Diamlerchrysler today! There's a bit more to it than that!!! Especially with the 50 year time factor involved. 1. Chrysler had SEVERAL chances to make a mark with the Imperial. One reason why they blew it as you correctly mentioned was the poor quality of the 1957's. Other problem was the general public still had 'Chryslerimperial' on their tongue despite the separation of Imperial name as a standalone marque from Chrysler in 1955. 2. Virgil Exner should have quits while he was ahead when it came to styling. The '61 and '62's were too radical for most people's liking with the free-standing headlights and tailights and huge fins. 3. The Engel designed Imprials should have done better saleswise for '64-'66 (when compared to Cadillac/Lincoln) where it had some distinction from the New Yorker, but that changed in 1967-68 when they started to look like a grown up New Yorker. 4. By 1969, the Imperial was barely distinguishable from the New Yorker and this plagued Imperial up until the end of 'Imperial episode one' in 1975. Supposedly that was the going to be the end of the Imperial brand, so they made the Imperial front and rear and interior into the New Yorker for '76-'78 along with a price cut (which may have pissed off more than a few buyers of the '74-'75's) 5. Enter 'Imperial episode 2'. Lee Iacocca had the then-brilliant idea of reinventing it with his interpretation of the Imperial with his Aspen/Volare based bustle-back 2-door coupe version from 1981-83. Even with its all-inclusive 2 year warranty, it showed digital dashes and fake wood trim do not make it a 'luxury car' on a basic leaf spring/crossover torsion bar suspension. Frank Siantra also thew in some of his tapes to help out his buddy Lee to see if it would sell better... 6. 'Imperial epsiode 3 1990-'93'. Try, try, try again, but same mistake as 1969-75! Again, based on the lwb New Yorker 5th Avenue, with little distinction between them. This time, Chrysler (and Cadillac and Lincoln by 1990) should have realized real wood trim and leather DOES sell cars! 7. Imperial episode 4, 2006 Concept; (its not over yet)'. With DCX in control, who knows if it will see production. This one HAS to be 'different' with those suicide doors, etc. It would be direct competition for Mercedes Benz if they make it too conventional while at the same time keeping it a true luxury car with real wood and leather inside. If it does go into production, we will have to wait and see how it will sell....will the public finally say "Its time for Imperial"? You decide. Craig. The reason we have DaimlerChrysler today is even tied to Studebaker. Chrysler decided to merge (arguably) at the apex of it's success and popularity. Kirk Kerkorian's (Former Studebaker Division Head, now billionaire owner of Tricinda Corp.) constant pressure on Chrysler CEO Bob Eaton pushed him into looking for a partner to avoid efforts by Kerkorian to take Chrysler private, or sell it out to the highest bidder. Eaton chickened out and took cover in the evil arms of Juergen Schrempp. The outcome would have been much different if Bob Lutz had been named CEO of Chrysler to follow Iaccoca. Another "we'll never know" scenario. Studebaker brought Mercedes to the American market, and at one time employed the man who provided the catalyst for the "merger"! Just plain eerie! > Little more insight: I think there was a desire at Chrysler in the > middle 50's to get rid of Packard in hopes that the newly independent [quoted text clipped - 32 lines] >> >> thanks, Jim Studebaker also bought an Airline in about 1962 only keeping it for a year before selling it to Kirk Kerkorian, who they may have originally purchased it from. Aparently they entered a management agreement in about 1957 with Curtiss-Wright in order to avoid insolvency, in the long run Studebaker survived until 1978 as that's the last available Studebaker annual report so were successful, just not as financially capable as Ford GM and Chrysler. Avantilover > Studebaker also bought an Airline in about 1962 only keeping it for a year > before selling it to Kirk Kerkorian, who they may have originally purchased [quoted text clipped - 4 lines] > > Avantilover Studebaker Worthington was purchased by McGraw Edison around 1979. BTW, the company was very solvent after getting out of the auto biz... JT I should have been clearer with my comments, I meant that compared to the "Big 3" Studebaker didn't have the capital to spend to upgrade their factories and products, we can be grateful for what they have left us. Avantilover > > Studebaker also bought an Airline in about 1962 only keeping it for a year > > before selling it to Kirk Kerkorian, who they may have originally purchased [quoted text clipped - 9 lines] > > JT AFAIR all the ALCO-Worthington engine prints that were part of Studebaker Worthington went to Fairbanks-Morse.  Signaturewf. > The reason we have DaimlerChrysler today is even tied to Studebaker. > [quoted text clipped - 11 lines] > Studebaker brought Mercedes to the American market, and at one time employed > the man who provided the catalyst for the "merger"! Just plain eerie! And Volkswagon to the Canadian market. Back in the early 70's all the pertinent Mercedes blueprints were in blueprint cabinets on the third? floor of the Avanti building. Dunno what ever happened to them. Anybody? There was also a file cabinet of Packard marine prints. -- wf. |
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