As best as I remember it, Curtis-Wright and Studebaker. both old-line Indiana companies, had been involved many times over the years, depending on who had money and who needed it. At one time, Curtis-Wright owned a minority interest in Studebaker stock. Then, Studebaker made lots of B-17 radial aircraft engines under contract in WWII. Then, in the '60s, Curtis-Wright had lots of profits and Studebaker had lots of losses. C-W bought up various pieces of the Studebaker/Packard merger, including the famous Packard Proving Grounds. They used these to show paper losses to balance against their profits to lower taxes. --------- According to Richard Langworth in "Studebaker The Postwar Years," Curtiss-Wright in May, 1956, proposed a twelve-year lease of the Chippewa (South Bend), Indiana, and Utica, Michigan plants. The cost of the lease was $25 million, payable immediately, plus $10 million for the purchase of Studebaker's present defense inventories. C-W did, in fact, later buy the plants, but sold Chippewa back to Studebaker in 1961. Curtiss-Wright also agreed to manage Studebaker-Packard for three years "at cost." This was in exchange for a two-year option on five million shares of unissued S-P stock, then valued at $8 per share. With a tax write-off of $150 million, Curtiss-Wright's actual cost for 45 percent of the auto maker would have been $5 a share. (I'm just repeating this, I haven't sat down with pencil and paper...) Curtiss-Wright also stipulated that Studebaker was to distribute Daimler-Benz products through its dealers. In return, D-B would buy a million shares of S-P common, at $5 each. This May offer was contingent on approval by insurance companies holding equity in Studebaker and by banks which would loan $10 million to C-W, and on a US government agreement to provide $200 million in defense contracts. Stockholder approval, Langworth reports, came "surprisingly easy." First half losses for 1956 totalled $35 million on operations and $60 million in capital reserves. Corporate worth dropped to $23 million. Jumping ahead to September, 1958: although its management contact with Studebaker-Packard would not expire until November, 1959, Curtiss-Wright exited the scene, without exercising its purchase options, but with the purchase of the Utica and Chippewa plants for an additional $2 above the original lease figures. The success of the Lark and new financial backers merely delayed the inevitable. Studebaker diversified itself right out of the automobile business. If you can find a copy (which arm and leg are you willing to sacrifice?), Langworth's book is a solid read. I can not recommend "Studebaker: The Life and Death of and American Corporation" by Donald Critchlow. It's rife with factual errors (and some pretty horrible syntax), though his perspective of the corporation's perception of itself and posistioning in the public eye is very interesting. Bonsall's "More Than They Promised" is sitting on my living room table; all I need is a little free time... ////////////Someone once told me that Studebaker owned part of over 100 different companies such as STP and Onan(?), etc. How true is that? If so, what happened to all of the money/profits that those companies still in business are making? ///////// Don't know about hundreds, but yes, Studebaker did purchase a number of other companies during the 1960's. It was done to use up the tax credits from the losses incured by the auto division. Studebaker owned Paxton, STP, Onan, CTL, Trans-World Airlines (for a while), and a few others. The profits from these companies were treated as profits from any company. A percentage was paid out in dividends (ie, to Studebaker Corporation) while the balance was reinvested in the company. The profits from those firms today are distributed to the people/firms that own the companies' stock today. Studebaker merged with Worthington, another conglomerate, in 1967 and became Studebaker-Worthington Corporation. Sometime in the 1970's Studebaker-Worthington was taken over by Consolidated Edison and the Studebaker and Worthington names disappeared. I still cannot figure out how this fellow with the plans to produce Studebaker vehicles can claim he owns the Studebaker name. The auto name was released to the public when Studebaker stopped building cars in 1966 and the corporate name disappeared with the purchase by Con Ed. Bill Vancouver, BC ------- Yes, Studebaker did have a long history of acquiring other companies. The one that fascinates me most is their takeover of Pierce-Arrow in the late 1920s. In the long run, that combination didn't do much good for either company. Studebaker ended up having to sell an ailing Pierce-Arrow as Studebaker itself was going into receivership in the Great Depression. The association with Studebaker did some harm to Pierce-Arrow's prestigious reputation as well. Even though Studebaker had an excellent reputation as a manufacturer of medium-priced cars, they had never been associated with the luxury car field (although it appears that Studebaker, like many other medium-priced carmakers, had aspirations in that direction.) It became something of an embarrassment when Studebaker introduced an 8- cylinder engine a year BEFORE Pierce-Arrow did, even though Pierce- Arrow was by far the more expensive car. It became even worse when Pierce-Arrow's 8-cylinder engine was introduced, and it became known that they were produced in the Studebaker engine factory! They really were two different and distinct engines, but many people just assumed that Pierce-Arrow was using the Studebaker straight-8. I've read that the engine production line had almost as many Pierce-Arrow quality inspectors as it did Studebaker employees! Rumors are hard to kill though, and Pierce-Arrow's quality image suffered as a result. I think the history of the automobile business is almost as fascinating as the cars themselves. Jerry K Seattle, WA ------ One of the great things about this group is our ability to discuss both current and historical issues. Jerry's observations are a case in point. Actually, the Studebaker/Pierce-Arrow union benefited both companies. Pierce-Arrow was on the verge of collapse when Studebaker acquired the respected but fading marque. Not only did Studebaker infuse capital into Pierce-Arrow, but more importantly brought to Pierce-Arrow a tremendous amount of talent. Under Studebaker's guidance, Pierce-Arrow produced its greatest designs, introduced its first 8-cylinder engine and resolved numerous quality control problems. In return, Pierce-Arrow designs and engineering influenced Studebaker (including enhancements to Studebaker's President 8 engine). Though popular belief holds that the union was not profitable, more recent research has shown the opposite was the case. Furthermore, I have never seen any credible evidence that Studebaker ownership in any way harmed Pierce-Arrow's reputation. Studebaker was a highly respected company when it acquired Pierce-Arrow, and sales of Pierce-Arrows rose until the impact of the Depression was felt. Buyers were no more likely to shun Pierce-Arrow because it was owned by Studebaker than they would avoid Cadillac because it was owned by the same outfit that produced Oldsmobile. That Pierce-Arrow ultimately failed was due to the Depression and the loss of Studebaker ownership and the financial/managerial support that went with that ownership. Leighzer 1950 2R6 1955 Commander 4-Door Sedan ----------------------- Not only did Pierce-Arrow get a modern straight-8 under Studebaker, but also a V-12. Studebaker also assembled Pierce-Arrow cars in their plant at Walkerville, Ontario from 1932 to 1935. Do not have production figures, but judging by registration figures, that was around 25-30 cars a year, except for 1935. Pretty small figures, mind you, even given the economics of the times. When discussing Studebaker's problems during the 1930's, many overlook the fact that Studebaker was paying out dividends greater than its earnings (when it made money) and paying dividends when it lost money. Financial results, from 1929 to 1932, with dividends in parentheses : 1929 : $12,000,000 ($8,000,000) 1930 : $1,500,000 ($8,000,000) 1931 : $1,000,000 ($3,000,000) 1932 : --$9,000,000 ($1,000,000) The company profit's totalled $5,5 million, yet the company paid out $20 million in dividends. This draining of cash reserves is what brought Studebaker to its knees. Studebaker no longer had the money to keep producing Pierce-Arrows at one end and advertise the Rockne at the other end. By the time of the receivership, all Studebaker could afford to produce were the sixes and small eights. Bill Vancouver, BC --------------- Actually, WWII caused the demise of Studebaker, Packard, Hudson and Nash. There were huge, new production facilities everywhere, built for military production, which were sold to the auto companies for next to nothing. This overcapacity benefited the high-volume producers, GM and Ford, much more than the low-volume independents. Henry Ford II was determined to put Ford back in the #1 sales position. He told his plants to run at full volume and ship product to the dealers. If the dealers wanted to hold on to their Ford dealership, which had been a gold mine for 40 years, they had to take and sell everything shipped to them. To move this volume, they had to discount the cars so much they were often losing money on every car sold, but this high production volume meant a Mercury (or Oldsmobile or Buick) cost 20% less to make than an equivalent Studebaker which sold for the same price. Bottom line, the independents were doomed, unless they joined forces. The egos of the men who ran the companies prevented consolidation, which might not have saved them in the end, anyway. Remember, there have been more than 1200 US independent car companies, of which only two remain today. thnx, jv. ------------ Perhaps there were some mutual benefits from the brief Studebaker Pierce-Arrow combination, but I still believe there were enough negative perceptions, even though unfounded, to harm Pierce-Arrow at least. I know the impression that Pierce-Arrows were equipped with Studebaker engines is widely regarded as having been harmful to their reputation. Yes, it's true Pierce-Arrow's sales peaked during the late 1920s, but then, so did the sales of every significant luxury car then on the market. That was more a product of the affluence and style of the Roaring Twenties than any association with Studebaker. It's true that Cadillac's reputation was not tarnished by the fact that it came from the same company as Chevrolet. Imagine the impact if people had come to believe that Cadillacs had Oldsmobile engines thought! In fact, this actually did happen when LaSalle switched to a straight-8 for 1934-1936. These engines were similar to Oldsmobile's, and even produced in the Olds engine plant, and the rumor circulated that LaSalle was just using Olds engines. It did a great deal to hamper the sale of LaSalles, and the damage was not undone until LaSalle returned to a V-8 for 1937. Pierce-Arrow's eight had far less in common (nothing actually) with Studebaker's, but the association was made, and the same damage was done. When prestige is one of your main products, a little damage can go a long way. As for Studebaker having any input at all into Pierce-Arrow designs, I have never seen or heard anything that even remotely suggests this is true. On the contrary, Pierce-Arrow is more commonly believed to have imparted engineering wisdom on Studebaker. And as for quality control, well, even if their designs had fallen behind the times in the early 1920s, Pierce-Arrow was always at the head of the class when it came to quality, which is why the Studebaker engine factory was swarming with Pierce-Arrow quality inspectors. The reverse never occurred. Chances are that the handful of Pierces assembled in Studebaker plants were merely prototypes; surely Studebaker was not so unwise as to tool up for production (even assembly) of such a tiny number of cars. I will agree that the Depression ultimately killed Pierce-Arrow, because the luxury car market itself all but disappeared at that time. Without General Motors, Cadillac certainly would have failed during the 1930s. Lincoln would have failed even more quickly without Ford's support. Packard alone, of the luxury car makers, was strong enough to weather the depression on its own, and even that was made possible only by its move into the medium-price field. As noted, Studebaker was in no position to provide any support to Pierce-Arrow by the time Pierce-Arrow was sold back into independence. Indeed, this sale was part of the requirement of Studebaker's receivership. Bill is right when he says Studebaker's dividend policy brought that company to its knees. It was completely insane to pay out dividends the way they did. They literally gave their company away, albeit to the people who owned it anyway (the stockholders). Albert Erskine can possibly be forgiven for believing that the Depression would be short, for at the outset many people believed that. Most depressions had been short in the past. However, to continue the policy for as long as he did, one can only conclude that Albert Erskine was at least as interested in his own personal fortune (which was comprised almost entirely of Studebaker stock) and the prestige of his company, and therefore himself, than he was about anything else. That he killed himself when the stock, and thereby his company and his personal fortune collapsed makes it hard to believe anything else. The decision of what models to produce while in receivership were not up to Studebaker. The receivers were in charge, and being businessmen, they knew that only the most appealing and profitable models could be continued if they were to have any hope of keeping the company alive. That's why the big eights and the Rockne were discontinued and Pierce-Arrow was sold. It was a sad time in South Bend. Replies? I always learn from them, so I hope there will be some. Take care, Jerry K Seattle, WA ------------- t's hard to say why any company with such a long history goes out of business, but it's easy to find several reasons why Studebaker ultimately failed. Mostly, they just had too many bad management decisions over a period of years, and the cumulative effect caused their demise. Just a few: Tooling up for a postwar car a time when they could have sold anything they could build Creating an ugly sedan from a beautiful coupe in 1953, and then mis-judging the models customers wanted to buy so that their beautiful styling became mostly a missed opportunity Investing heavily in one automatic transmission, only to reject it after only 4 years and switch to another Failing to build a modern factory while they were profitable; eventually they found themselves building cars in a wagon factory which was inefficient at best, and unable to handle the "wider" cars that became the new standard of beauty in the 1950s & 1960s. To give them credit, Studebaker management often did better than expected given the trying circumstances they were facing. By the mid-1950s, it was almost impossible for an independent carmaker to survive in competition with the Big 3; they just couldn't spread their tooling investment out over enough cars. Studebaker hung in there longer than anybody else except American Motors, so they really did pretty well. As for being too far ahead of their time; well, I really like Studebakers, but let's face it; their list of firsts just can't compare with those of GM, Chrysler or Packard. By the mid-1950s Studebaker was mostly playing catch-up and "me too" when it came to significant engineering developments. (They bought the disc brakes off the shelf, and the superchargers too. Besides, superchargers were old news by the '50s. Fiberglass bodies were still novel, but far from new in the early '60s.) Studebaker did an OK job of keeping up, given their lack of money, but even the Lark was really a new skin on an old-fashioned chassis. Any other opinions & ideas? Take care, Jerry K --- Three major factors: Economy of scale. Studebaker, like all of the independents, had to amortize costs over a smaller production run, resulting in a higher cost per unit. The figure I see quoted is that if Chevrolet was building the same car that Studebaker built, they would be able to produce it for $200 less per car. Remember, this was during the Fifties, when a dollar was still worth something. Part of this cost was also the higher hourly wages Studebaker employees earned compared to the rest of the industry, part of the climate of "benevolent paternalism" that allowed the company to brag about its labor relations. Also, Studebaker essentially built two completely different cars -- the sedans shared almost no sheet metal with the coupes, which also were built on a different, longer wheelbase frame. Dividends, not development. Instead of plunging profits back into infrastructure, Studebaker diversified. Ultimately, that was good for investors, but death for profitable car building and the end of name (though there's still a Studebaker-Worthington Leasing out there someplace). By the time Sherwood Egbert ordered fresh paint slapped around South Bend, the factory layout was hopelessly out of date. The conveyor system transporting car bodies through several buildings was ingenious in a Rube Goldberg sort of way, but only a stop gap measure. There wasn't money for engineering or new tooling, which meant that the cars produced at the end of South Bend operations in 1963 were riding of chassis and suspension that came out in 1951 and the Lark bodies were updated 1953 designs. The GT Hawks had direct lineage in the 1953 Loewy/Bourke coupes as well. Even the Avanti harked back too that last era -- it road on a Lark frame. Absolutely what that company accomplished on so little money! Dealer network. Studebaker's dealers were, generally, small operations selling few cars when compared to the Big Three (or big two-and-a-half -- Chrysler lagged well behind Ford and GM). The dealers couldn't cut the deals higher volume would allow... and when Ford and GM declared war on each other by flooding the market and undercutting prices, it only worsened Studebaker's ability to compete. Remember, Studebaker's last big success before the Lark was the unexpectedly high sales of the Scotsman models of 1958: cars that were stripped of every amenity, save the driver's side sunvisor. 1958 was a depression year, hardly the best time for Ford to introduce its new luxury car, the Edsel. And we all remember how that turned out. ----------- Studebaker of Canada did, indeed, assemble Pierce-Arrow cars for the Canadian market at itsWalkerville (Windsor) plant. The Canadian plant was an assembly plant, and all the plant did was assemble parts purchased from outside suppliers. The P-A body stampings were imported from the U.S., along with the chassis, engines, transmissions, axles, suspenisions, and a number of other parts. The bodies were assembled in Canada, painted in Canada, and usually trimmed with Canadian-supplied soft trim bits. Rubber and electrical parts came from Canadian plants. Studebaker of Canada had no tooling expenses to speak of. The production numbers may seem small, but the Canadian market is one-tenth that of the American. And in the depression it was less than one-ninth the American. By assembling Pierce-Arrows in Canada, Studebaker could make use of the lower import duties. The more Canadian-content in a vehicle, which included labour, the lower the import duties on the parts imported. This came to and end in 1936, and the import duties became a flat percentage. Thus Studebaker closed its Windsor operations, and sold the plant to Ford of Canada in 1942. Studebaker did not build Pierce-Arrow cars in either its South Bend or Detroit plants. The only plants building Pierce-Arrow cars in the U.S. were the P-A plants in Buffalo, New York. After WWII, the Hamilton plant was also an assembly-only plant. Body stampings came from outside suppliers (Canadian and American) as did all the bits and pieces that made up a Studebaker. Engines came from South Bend up to the end of the 1964 model year and for 1965 Studebaker bought Chevrolet engines from McKinnon Industries, a subsidiary of General Motors of Canada, in St.Catherines, Ontario. Bill Vancouver, BC ----------- I believe the early restyle after World War II was a wise move. They were able to tool a new body using 1945-46 dollars and not the later inflated 1948 dollars. So, Studebaker saved money by introducing a postwar car in mid-1946 (1947 models). After all, Studebaker would have had to come up with a new postwar design by 1949 to keep competitve, so it was not something that Studebaker could put aside, as Packard found out. Also, the 1947 Studebakers received publicity that no other car since the Ford Model T had received, and it was positive publicity that cost Studebaker nothing. The 1947 Studebaker was the source of countless comments in print, radio and movies. The 1947 Studebaker became the definition of the new world after the war, and was the standard to beat by the Big Three (and not the other way around). The Kaiser and Frazer were also new for 1947, but the Studebaker was considered the better looking vehicle. Studebaker's reputation as a forward-thinking auto maker was established with the 1947 models. It was publicity that no amount of money could buy. Yes, the big error was not building new plants. Although the 1947 Studebaker cost $13 million to tool, that money was recouped in a little more than a year. In 1947 Studebaker made $9 million in profits, followed by $19 million in 1948. Total profits from 1947 to 1952 totalled $105,227,699, while net worth increased $72,175,616. One would think Studebaker could have built some update-to-date plants with that kind of money. Again, though, Studebaker was handing out generous dividends. A nice idea for the short term, but again not wise for the long run. The Studebaker Automatic, built by the Detroit Gear Division of Borg-Warner, appeared in mid-1950, and was used through the end of the 1955 model year. The Flightomatic that appeared for 1956 was built by the Warner Gear Division of Borg-Warner, and was actually the Fordomatic and Mercomatic introduced in 1951. The same unit was adopted by American Motors for 1957, who called their version Flashomatic, and from 1958 to 1962 could be had with cable-operated pushbuttons. However, the decision to drop the Detroit Gear transmission was not Studebakers. Studebaker car production had fallen from 344,164 units for model year 1950 to 81,939 in 1954, although rebounding briefly to 133,827 in 1955. Thus, the demand for the Studebaker Automatic also dropped, and the cost per unit to produce it was increasing. By the end of 1955 Detroit Gear could not longer provide the transmission at a competitive price. Thus Studebaker had to start purchasing the Warner Gear unit. The problems with the 1953 models actually were more production than style. Today we think the sedans were dowdy but compare a 1953 Studebaker Champion sedan with a Chevrolet, Ford or Plymouth. The Studebaker was the more modern looking car, as Studebaker's competition had even balloonier roofs than Studebaker! Yes, the design could have been improved by leaving the windshield pillars and the roof alone, but that would not have helped to overcome the engineering errors with the design. Not many know it, but the 1953 Studebakers were designed with a "flexible" chassis frame built with thinner than usual gauge steel and a stiffer than normal body - the floor is thicker than most cars to help give the body more rigidity. In theory it worked well, but when the first cars came down the line, the disaster became evident. The chassis was assembled with engine, transmission, axle, suspension and tires. Then the completed body (minus the front end clip) was attached to the frame. But, when the front clip was placed onto the body/frame, it did not fit! The 6-cylinder Champion sedans could be completed, while the Commander V8 sedans could be done with shims. It turns out that the chassis frame flexed under the weight of the engine and body and thus the front clip did not line up with the attaching points. The 120.5" frame used by the hardtops. coupes and Land Cruiser flexed the most, while the shorter 116.5" wheelbase frame was was not affected as much. And thus the delay in getting the hardtops and coupes into production, and why the production was not a great as it could have been. For 1954 Studebaker produced a chassis frame with the normal 11-gauge steel instead of the 1953's 13-gauge. It would take General Motors to work out the bugs of producing a light perimeter frame and using the body to add the needed stiffness to the structure. And the other great error of the 1953 body, and an error that was never rectified, was the problem with rust. The design of attaching the fenders, front and rear, to the body offered no protection from the water and muck thrown up by the wheels. The fenders on the 1966 Studebaker attached to the body in the same manner and places that the 1953 fenders did. The 1953 Studebakers gained a reputation of being rattle-traps and rust buckets. Although the cars became more solid, Studebakers were known for rust right to the end. Ever stop to wonder how that affected sales? Bill Vancouver, BC :wq! -------------- The crunch for the independents came in the mid-1950's with Ford's push to beat Chevrolet. This not only helped cripple the independents, but also seriously hurt Chrysler. The independents had access to these war-time production facilities as did the big three. The plants were built with government money and thus owned by the government. Tucker acquired the ex-Dodge tank plant in Chicago, while Kaiser-Frazer got Ford's ex-bomber plant in Willow Run, Michigan. Meanwhile, Studebaker acquired a war surplus plant on Chippewa Avenue in Mishawaka for truck production. The big problem, however, was the number of vehicles sold by the independents. They were too small to cover the costs of tooling new bodies every four years (with major restyles for the third year) plus new overhead valve engines. That was why George Mason of Nash was pushing for a merger of Nash, Hudson, Studebaker and Packard. They could share bodies and engines, and the costs incurred. If George Mason had not died in 1954, American Motors may well have merged with Studebaker-Packard. It has long been claimed that was the master plan - Mason get Nash and Hudson together, and Nance get Studebaker and Packard together. Then the final move was to merge the two together. The two groups did attempt to supply parts to each other, but apparently there was resistance on the part of George Romney, Mason's successor, S-P sold AM Packard V8 engnines and Ultramatic transmissions, and Studebaker wanted to use the Rambler ohv six. But Romney felt AM needed all the engines and thus would not sell them to S-P. AM also bid on making parts for S-P at the old Hudson plants in Detroit, but the costs quoted were higher than competitors. Thus S-P did not used AM services for parts. And the rumours of Studebaker's demise came not from Chevrolet. They were hinted at in the media. Motor Trend, Motor Life and Car Life all had articles on Studebaker and its fight for survival. If you read some of them, you do not always get a positive impression about Studebaker's fate. Plus the fact that Studebaker was losing money did not give the car buying public a confident feeling. In the period from 1954 to 1962, Studebaker-Packard made money in 1959, 1960, 1961 and 1962 - a total of $34,350,705. The loses from 1954 to 1958 totalled $124,209,453 and 1963 had loses of $16.9 million. In the case of Studebaker, its problems arose from antiquated plants, overpaid labour, a few auto engineering faux pas, and management not willing (or able?) to deal with the problems. Nash was smaller than Studebaker, but it did invest in new plants, kept its labour rates competitve, made few engineering errors (and was slightly conservative) and had management that tried to be ahead of the game. Bill Vancouver, BC ---------- Wow!! This is a question for which there is no one right answer. We could debate this forever. I believe the seeds of destruction were sown during the 1920s. First, Studebaker's board adhered to the big dividend philosophy. Though a common and well accepted business practice, it robbed of the company of funds that could have been used for capital improvements, acquisitions and in times of financial hardship. This policy would come to haunt Studebaker as the Great Depression took hold. Secondly, Studebaker made a complete mess of its attempt to acquire White Motors. It was a great idea. Had Studebaker pulled it off, they would have had a great chance to dominate the truck industry. Their move failed because 1) amazingly they ran afoul of an obscure Ohio law (one that Studebaker's lawyers should have identified and advised management on), and 2) they were rapidly running out of cash due mostly to the big dividend policy that continued right into the depression. Third, the Pierce-Arrow acquisition only hastened Studebaker's financial implosion. Though the move was based on sound business strategy, Pierce-Arrow needed an infusion of cash. Coupled with the big dividend policy, Studebaker's financial woes were mounting. Fourth, Studebaker failed miserably in its two attempts to enter the low-price field - first with the Erskine and then the Rockne. All of this led to Studebaker's decision to enter into receivership in 1933. As a result, Studebaker was forced to sell Pierce-Arrow and their majority interest in White Motors. Without cash, the company had to put their plans for a low-price car on hold. Thus, Studebaker was left as a maker of mid-price cars, not the greatest position to be in during the midst of the Great Depression. Receivership and the fall of Albert Erskine took the wind out of Studebaker's sails. Though Vance and Hoffman were very able men, they lacked the vision and daring of Erskine. Vance and Hoffman sought only to secure Studebaker's position. By contrast, Erskine wanted to make the company grow. Erskine understood that Studebaker's long-term survival depended upon its ability to transform itself from an independent manufacturer of mid-priced cars and some light-duty trucks into a full-line company (low-, mid- and high-priced cars and light-, medium- and heavy-duty trucks). Time certainly proved Erskine correct. Had it not been for the big dividend policy, he probably would have succeeded and the Studebaker Story would have taken a much different direction and may have survived to this very day. Of course, other factors contributed to Studebaker's demise. A few of the more notable: * The decision to produce the "all-new post-war car" in 1946. Since it was a seller's market and a company could sell everything it could produce, Studebaker would have been better advised to have used its war profits to upgrade its manufacturing facilities. In fact, they could have built an entirely new assembly facility in South Bend, thus reducing their high operating costs. * The failure to end the piece-work system at the end of the war. This was an especially costly mistake. * The failure to take advantage of their war-time reputation as a truck manufacturer. Not until it was way too late did Studebaker understand the importance of the truck market. * The loss of Paul Hoffman during the critical post-war years. Hoffman understood trucks and the need to invest in plant. Vance just wanted to sell cars and appease the stockholders. * The resumption of the big dividend policy following WWII. * The failure to clearly distinguish between low-price Champions and mid-priced Commanders and Land Cruisers (and later Presidents). Consumers began looking upon the entire Studebaker line as low-end. * The failure to develop and execute a clear, consistent advertising policy. * A weak dealer network. * The decision to rush the C&Ks to market and the resulting quality control problems. Well, you get the idea. Leighzer -----------