Re: Packard & Hudson proximity

Posted by Craig the Clipper Man On 2013/2/13 13:28:46

Mahoning63:

Offering top-notch cars is the goal of most auto manufacturers, so the idea of Packard building top-notch luxury cars and Studebaker building top-notch small cars is fine; but no matter what the quality, the writing was on the wall. 1955 was a fantastic year in cars sales overall. Chevrolet and Ford sold 1,704,667 and 1,451,157 units, respectively. Overall, in terms of corporations, General Motors sold 3,721,527; Ford, 1,808,187; Chrysler, 1,262,444; Studebaker-Packard, 171,580; Nash-Hudson-Metropolitan, 147,787.

Individually, Cadillac sold 140,777 cars, while Studebaker sold 116,333; DeSoto (part of Chrysler), 115,485; Nash, 96,156; Packard, 55,247; Hudson, 45,535. Lincoln sold only 27,222 and Imperial sold about 12,000. Here is the BIG difference: Even though as brands Lincoln and Imperial numbers were abysmal, they were divisions of solid, high-volume corporations that could easily absorb the losses. Those of you who thought a Packard-Hudson partnership would have worked out better, consider that that combination would have sold only 100,782 units. Even more distressing would be the fact that Packard, not Hudson, would have been the higher-volume producer!

What these figures don't show is the actual break-even points. While Packard was still profitable in 1954, Studebaker had told Packard reps that its break-even point was 165,000 per annum, when in reality it was 265,000. In 1956, Nash sold 83,420 cars, while Studebaker's numbers fell by more than half to 69,593. Hudson ended the year selling only 22,538 cars and Packard pulled the plug at 10,353 cars in June.

Raymond Loewy/Studebaker may have hit the ball out of the park with the 1950 bullet-nose models, Studebaker was a mere shadow of its prime by 1955. Packard simply did not have the money to bring out high-end new models in 1956. By that time the company was near bankruptcy and was acquired by Curtis-Wright, which decided that Studebaker, with its higher volume, would continue, while Packard was through. Even then, the Packard badge continued on Studebakers until 1958, the same year Hudson went under.

Automobile manufacturing is an expensive, high-risk business these days as well as in the 1950s. To produce a high volume of cars to make a large profit demands very deep pockets up front. By 1950 the battle lines had been drawn and those not attached to the big boys -- GM, Ford and Chrysler -- would have a very tough road ahead. Brands like Kaiser, Willys (the cars, not Jeeps), Hudson, and Packard would not make it to 1960; while others such as Nash would morph into American Motors. Kaiser would continue into the 1960s, but only at Jeep, which was later acquired by AMC. Ford's Edsel had a three-year run. DeSoto survived until 1960 when Chrysler pulled its plug. Studebaker car production ended in 1966. Since 1966 companies have appeared and disappeared, such as DeLorean, Bricklin, Excalibur, Zimmer, and a few others whose names I forget.

Several years ago I read that for a car company to take a car model from concept to production costs about $1 billion. I suppose after adjusting for 1950s currency values, that figure would probably have been less than it is today due to regulations, safety, emissions, etc.; the reality of very high costs remain.