Packard Forum Index » Studebaker Built Packards (1957 - 58)

Considering that Studebaker was a subsidiary of the Packard Motor Company (vale June 1956) doesn't that mean from a corporate sense that all vehicles produced from the end of the Packard factory until the end of Studebaker in 1966 were actually Packard built Studebakers?

Try telling that to the hardcore Studebaker guys. They still don't believe that it was Studebaker that killed Packard!

A nice premise but I think the majority of good Packard people had left or been shown the door by end of 57 so when you consider Stude mgt had day to day control (don't know if C-W was really in the down low nitty gritty) & cars being built in a Studebaker plant by Stude guys and looking like Studes with mostly Stude parts that you will even get much of an argument for Packard still even existing--indeed after 62 not even the name was left--let alone building them.

Hello Gentlemen

Packard, as a corporate entity existed in name only after the Joint Agreement with Curtiss-Wright took affect. Reading minutes of board meetings from those years, it becomes clear that C-W management had oversight, input and to approve all decisions concerning operations and products. Any decisions affecting their mandate to stem the losses and salvage something of the automaking operations was definitely not made exclusively by Studebaker management.

Once S-P had survived most of 1957 and settled on the compact car program as their salvation, C-W withdrew, ending their association by the end of 1958.

Everytime I read some foolish derogatory posting on how "Studebaker killed Packard and/or Pierce-Arrow" I want to diplomatically suggest to the poster he stop advertising his ignorance and take the time to read enough history to come a complete and realistic understanding of auto history.

Steve

I'll admit to not having read every scrap of history but what I have all tends to indicate there was blame on both sides:

Packards side: Even in 54 Packard was apparently still operating under the Macauley rules- that being a company run by gentlemen so a persons word and handshake was good. To paraphrase one of those articles, It would appear much more time was spent on redecorating and painting the plant than any due diligence done on the tieup. I believe that same scenario haunted them in the joint stampings & try at shared components Packard was attempting to do with AMC.

Studebakers side: They either didn't know themselves how bad a shape they were in or it was a lie when they gave numbers as to losses and production amount it would take to break even. Seem to recall there was also a high labor contract and a union not very willing to budge since this was the days before concessions were given to keep a company going.

At any rate it all boils down to both companies were bleeding money, the government policies & politicians of the era didn't care much about either one so no bailouts and not even a token bone until it was too late for Packard. With refreshed but obviously older styling and GM & Ford both having their on & off war almost giving cars away in the battle to win market share, not many were going to buy a more expensive Stude or Packard so not very many options or much income from car sales.

After the token help and writeoffs, Stude was able to scrape enough together for the Lark update. That was well received and they had a couple of good years until the big 3 caught up. The handwriting was on the wall by then anyway so diversification and out of the car business ASAP was the order of the day.

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I will respectfully have to agree with HH56 on this one. But every book I've read about Packard blamed the merger with Studebaker as the reason for the "as-fast" demise.

But, in the end, it doesn't matter, and we can't change the past. They both made wonderful cars, and it's a shame that they're no longer with it.

That being said, I'm NOT a Studebaker hater, and would REALLY like to find a '59-'61 Lark 2 door with a V8 and a manual trans....

Hello HH56, Eric and Others

Both you fellows are clearly knowledgeable about the backgrounds of each companies so we don't have the problem of erroneous affixing of blame.

Before the debacle of 1956, both companies practiced complicity in self-deception and omission when entering into the merger.

Both companies had intractable problems neither really wanted examined. Studebaker had saddled itself with high labor cost, working in antiquated buildings, resulting in a 10-12% cost disparity with competitive makes.

Packard had poor plant utilization, heavy dependence on defense contracts, poor return on it's automaking operations.

When they signed the merger agreement, each was hoping to gain more from the association rather than having to deal directly with their basic problems. Problems such as weak dealer network and stale management just added to the situation.

Once the disaster hit in 1956 and no savior would voluntarily come forward, a little arm twisting on Curtis-Wright by the Eisenhower Administration is how they got involved with the management of S-P. Make no mistake, they weren't willing participants, except that they saw the opportunity to extract S-P defense business and assets in exchange for funds to keep a portion of S-P afloat.

Bailouts, as we know them now, were unheard and would have been politically unpopular, seen as a type of socialist meddling in the economy. Politicans did get involved though because 1956 was an election year and allowing two major automakers to completely collapse would have looked bad for the Eisenhower Administration. C-W being a major defense contractor couldn't very well refuse to help in this situation.

When the question arises, which company killed which, it's most accurate to say both jointed hands and jumped willingly onto the leaky ship together. After hitting the financial disaster iceberg, as both were drowning, somehow Studebaker grabbed onto a barely floating piece of the ship being towed by C-W. Somehow they patched and righted that tub enough to keep going for a decade longer until the ship office, now with profitable diversified crafts, scuttled that last automaking tub.

Steve

I won't say that Studebaker set out, with forethought and malice, to slaughter Packard, but the merger hurt Packard more than it helped.

I never audited the books and am no accountant, but - outside of some consolidation of their warehousing and distribution system for service parts and a handful of shared parts like the Packard V8 in the 56J GoldenHawk and front wheel bearings and grease seals common to '56 Clipper and Studebaker - I just don't see where they achieved much in the way of economies of scale from the merger.

While Packard picked up some much-needed additional outlets for product by way of Studebaker dealers, I don't belive those dealers had time to become sufficiently developed to handle the product well enough to benefit Packard. Although the local Stude dealer, here, delivered a '56 Caribbean (and was proud of it), I'd wager that Studebaker dealers, on average, sold a lot more Clippers than Senior Packards, compared to traditional Packard dealers. While Clippers were probably a nice (and profitable) up-sell for a Stude dealer, I bet it cost Packard almost as much to build a Clipper as a Senior - that is, Clippers were much less profitable on a per unit basis. Stude dealers selling more Clippers only skewed the break-even point.

IMHO, the S-P merger was a shotgun wedding - a match made in Hell. I'd like to say that I wish it had never happened, but I can't. I have to admit that without that merger at that time, management might not have had the confidence to move forward with the 55th-56th Series cars and all the feature we love.

Since Curtiss-Wright's involvement appears to have been the last resort, one would have to go back a lot further in time than 1954 to right enough of the wrongs to make a difference in the outcome.

There were two final decisions that put the last nails in the coffin of Packard. Both these decisions were made by James Nance.

The first decision was not to go into a merger with Nash just because he couldn't head of all AMC.

The second was buying Studebaker.


John F. Shireman

When did CW buy SP ???? Perhaps that would answer the question as to whether or not Studebaker killed Packard. Most likely it was CW that killed Packard.

Much of the problem with this kind of analysis of any company or merger is not knowing what goes on behind the scenes. Info that book writers either do not know are not willing to write about.

I'm no expert on Studebaker. As i understand from stories i've heard from a few people i knew that worked for stusebaker, Studebaker suffered from too many family members involved/working with the company.

It's called corporate incest. Same problem that nearly killed Chrysler in the mid 70's.