Why did the Studebakers go under?

I learned to drive in a then 10-12 year old '65 Chevy 1/2 ton with a 283 (I think) and 3 on the tree around the side yard when I was growing up. It was ok for a freebee from my older brother, but it was basically junk but running/driving already by that time and nothing impressive in the engineering sense by a long shot. I had a similar '64 Champ a couple years back and I'd take that over the Chevy any day of the week. Pretty darn nice riding truck actually, even with the straight axle up front. Rode nice and smooth, felt pretty good and that was just a couple years ago and that truck wasn't even restored. A 40 year old Studebaker was nicer than similar era 10-12 year Chevy.

The Champs biggest problem is the cabs door seals didn't hold up well and if not maintained often, they leaked and rusted out the floor pans which got to the front cab supports. That caused the cab to sag and cause body fitment problems. A notable weakness for sure, but still a damn nice truck otherwise.

The rear sliding windows could leak also when the seals got old and dried out. Oh right, almost forgot, they were the first to do that too. Think about that the next time you slide open the rear window in your truck.

By using the larks for the cabs, they were yet again ahead of the design curve. Maybe not 100% by choice, but possibly more by financial necessity. But still, having the truck cabs more car like and therefore more comfortable, the big 3 were yet again caught playing catch up a few years down the road which they didn't start doing until the late 60's, 10 years later.

They either invented or at least was the leader in using double walled pickup beds too and with steel floors instead of wood. When did Chevy stop using wood floors? '68?

In short, there are multiple reasons why Studebaker went under and they fought it for decades. They were the longest lived US auto manufacturer until surpassed by GM just a couple years back I think. And we all know GM came damn close to not making it recently themselves. Personally, I'm still not sure they are out of the woods yet. I hate to say, but good chance they are about Studebaker circa 1961-62. If there is another notable economic setback, we'll see how they take it.

Lastly, I thought I wanted to buy a new Ford F250 for some reason a couple years back. So, I went and test drove one. Uh, I think I'll just keep driving my '53 3/4 ton instead. Almost 60 years down the road and that is the best they've got to offer now? Sorry, not impressed.

 

Studebaker did not "Go under" They simply left the auto making business for greener pastures.

 

Alot of you are misinformed about Studebaker and Packard history. Studebaker stopped making cars in 1966 they did not go out of business. They diversified. Studebaker owned chemical companies, airplane co. They owned STP. Paxton superchargers were a studebaker company. They also owned a construction compression company. There are countless other companies that i can't remember off the top of my head. I also read that in Russia they still build those Studebaker military Veh. When it comes to Packard They bought Studebaker then made a quick decision to move Packard production to the most advanced Studebaker plant, guess what happened, You could not get a packard out the door of a studebaker plant. So they decided to keep producing studebakers they used up all the left over Packard motors that's why the early hawks (golden) had 352 motors with the paxton supercharger. Studebaker had a real good customer base so they pushed on. Mercedes asked Studebaker to be their dustributer they did for a while that could have saved them. The bigest thing was all the independent auto makers were going to merge however the guy that thought it up died. As far as studebaker falling behind In 1951 Studebaker was the first independent with a V8 they also had a new car in 1946 before anyone else did most other makes had warmed over 42 models.

 

I've been through the Studebaker museum, and the history of the company is quite impressive. They had a lot of things going for them, but in the end, it was mismanagement that really ended up killing them. Lots of "should haves" and "could haves".

I think the main problem was that they felt they needed to compete with the Big 3 as a full-line automaker. If they had pared down and run it as a "special" offering with cars that were unique and ahead of the more commonplace cars they probably could have done better. Spreading the already thin new project budget across an entire line created half-ass cars, rather than a couple world class cars that competed in niche markets. Sure, the company wouldn't be as "big" as it had once been, but it would have survived. I don't understand why most automakers feel as though they have to be all things to all people. That just dilutes what makes you special.

In visiting the museum, I came to really appreciate the innovative products they had, and felt really bad that we lost this part of Americana. Still, I often wonder how the name "Studebaker" would have held up in today's "brand image" world. Much like Oldsmobile, the name is just difficult to "sell" nowadays. Maybe they could have been iStudes.

 

One needs to remember also that Studebaker made covered wagons in the old old days. They were blacksmiths and wheel barrel makers. They did not make bicycles into cars. There first car was The electric car which Thomas Edison bought the second produced. I don't think they tried to compete with the big three so much, they built cars for their consumer base. I notice studebaker people are loyal to Studebaker thy own a number of them rather then own mixed makes. The real sad thing about Studebaker was that they had 5 bothers however they had no one to hand the company down to like Ford. If they had they would still be in business today. The -son - law ran the business then others. I was told that as of the late 50's a Studebaker family member still signed the checks given to employees. If you have ever owned or built a Studebaker you have a great machine, you have to go to a Studebaker meet to get parts and they are still around some made new. I love Studebaker post war and pre war. I am building another as we speak.

 

Who's to say what would have happened to Studebaker if SP and AMC had all been together.

I'd like to see the 57/58 Packard concepts.

 

Thier sales motto for a while was different by design. they kew they were not marketing to the mass market, they had cornered a niche market of folks who appreciated design and in some cases engineeing. Their market got smaller as folks turned away from different. Their level of production and sales could not support the R and D and retooling costs to make the changes necessary to gor from the 60's where cars were still basically transportstion devices to the 70's where cars became status symbols and indicators of personal expression.

The Avanti was supposed to be the beginning of the bold leap but it stumbled.

I do believe the 63 Gran Turismo coupes were and are some of the best looking cars around.

 

the red stude looks great.. anyone have a picture of this truck you guys mention a couple of times.. think it would add to the thread for future searches..

chris.

 

I've always been told that when Studebaker removed the tongue
from their wagons and started making cars,It was all downhill from there

 

Studebaker had a running start on the competition. They were a successful wagon maker and got into making cars early. Before Ford they were the biggest car company in the world. At one time their testing and development methods were also ahead of the competition.

The history of the car business is full of examples of how one or two miscalculations can take down a major contender. That's a big part of why successful car companies have traditionally been very conservative about deviating too far off the proven path, or making too many changes at one time.

Not a good long term plan, but people will buy mediocre cars if they look good. Studebaker made a few good looking cars, but most of them were quirky. The point that was made about people buying ugly cars probably had a lot to do with Studebaker's problems.

 

Was told by a former Studebaker employee that Studebaker couldn't compete with GM & Ford who sold cars at huge discounts. He said Studebaker couldn't afford to "give them away." BTW, the folks in Indiana LOVE Studebakers.

 

Interesting reading.
I can add a few random but interesting factoids that I read in an old (1974)issue of Car Classics Mag.

The magazine states that, according to E.T. Reynolds, Asst. V.P. of Engineering, "The concentration of effort and the huge investment involved in the Avanti projects precluded any major re-design of the rest of the Studebaker line for 1963...." (Brooks Stevens was, however, successful in introducing a completely new look to the Lark series above the belt line....)
In 1964 the United States Automobile Club declared Studebaker the performance leader of the year after the cars cracked 72 official USAC records on the Bonneville Salt Flats, including a two-way flying mile run at an avg. speed of 153.48 mph by a Daytona Convertable equipped with an optional R-3 Avanti engine.
A new experimental 340 c.i. engine was being developed and planned for 1965 but it never saw the light of day.
The Studebaker dealer organization was a weak link in the corporate chain.
Until around 1958, Studebaker had been engaged solely in the transportation business. But by 1963, diversification had brought non-automotive stuff to about half of corporate sales.

 

A couple of more thoughts. I've owned three Studes (2-1/2 really). Even when sales were down, Studebaker either couldn't or wouldn't lay off workers. Consequently, they continued to make parts, which means a lot is still available. Except early sheet metal and stuff for the most popular models.

Many of the left over Lark chassis ended up under the retro Excalibers. Some innovations like using the same bumpers front and rear make sense when you're trying to hold the bottom line. Sliding wagon roofs and hill holders were also practical. Studes were also favorites for fleet sales, military, taxi's, ambulance and postal vehicles. The Lark sucessfully anticipated the compact car years before the Falcon, Valiant, and Nova. The Avanti anticipated the Pony car before the Mustang and Camero.

Stude also owned Onan generators, Gravely tractors, and as mentioned earlier STP. Quality and design was hit or miss. My '53 Starlight was beautiful to look at but a bucket of bolts, assembly wise. My '66 Daytona, while not the most aesthetically pleasing, is head and shoulders over my friend's comparable '66 Nova. Quieter, more solid, and not as tinny.

 

What you described is the predicament you can end up in when earlier miscalculations make you non-competitive. Because they didn;'t have the money to do otherwise, companies like Studebaker, Hudson, and Kaiser reworked the same basic hardware two and three times trying to make it look new or different. If the public realizes you are doing that they are less likely to buy your cars.

 

Didn't they end up being the Clark-Studebaker Corp, (or Studebaker-Clark)? Seems like they made floor buffers, among other things.

 

As a side note. A Swedish famous bankrober
in the fifties was known to only steal Studebakers
as escape cars

 

I can put it in MUCH simpler terms: poor management.
That is the #1 reason companies go under and yet it seems never is blamed for causing it......

 

This is a great point: Studebaker tried to go toe-to-toe with the market instead of seeking the niche business that could have sustained them in the long term.
They were a transportation company in the broad sense, having gone from Conestoga wagons to automobiles and trucks. Maybe they could have gone into the big truck market like Peterbilt, building very high-quality cabs and frames, since all the other truck parts are always outsourced anyway.

Maybe building sports cars and luxury cars would have been a better choice than trying to slug it out against Impalas and Galaxies.

With the resources at hand they could have used the tech developed on the WW2 Snow Weasel to build tracked go-anywhere vehicles, both large and small, as Bombadier did. They might even have broken into the motorcycle market, which was healthy enough to support a variety of manufacturers through the years.

If I was a Studebaker dealer or stockholder, any of these possibilities would have been rosier than going out of business.

Or Hewlett-Packards

 

A couple of decent articles about Studebaker's demise:

http://richardlangworth.com/why-studebaker-failed

http://www.hemmings.com/hcc/stories/2009/05/01/hmn_opinion2.html

 

Studebaker never had enough money to really retool another body after the '53s came out. The Lark is just the 57-58 Stude body shell shortened up fore and aft with new nose and tail. Eventually it got a new top, too. Same with the Hawk. Even the last ones interchange pieces with the first ones.

Which taught the big three that people will still buy something new even if the basic design is old. So you've had cars last longer, and longer, and longer.. the Ford Crown Vic was the same for like 15 years -

 

They used high grade parts like Stewart Warner guages, switches and heavy duty sway bars etc. we used to pick them chean in a junk yard .I ran a toggle headlight switch for many years.

 

Studebaker was struggling for years before they died. Perhaps their troubles began in the thirties when they paid dividends out of their savings, when the company was losing money.

This must have seemed a sensible use of their cash except they had no idea the depression would last as long as it did.

It is also true their labor costs were high and their plant old fashioned and inefficient. A former Ford engineer told this story. In the fifties it was his job to dismantle competitors cars and analyze them piece by piece. All car companies do this as part of their research. He found that if the Studebaker had been made in the Ford factory it would have cost 20% less to build than a Ford. At the time, a Studebaker cost 20% more than a Ford and Studebaker was not making money. All due to the high cost of production at Studebaker.

The rot really set in around 1953. That year they brought out an all new model that should have been a sensation. It didn't sell well except for the coupe model. In following years sales fell even more.

At the time Ford was in a ding dong battle to outsell Chevrolet by fair means or foul. This is the time Ford developed the "System House" method of selling cars. This is when car dealers and car salesmen got a reputation for being liars and crooks who would do anything to swindle a deal. It resulted in a spate of new laws aimed at regulating car dealers including the "Mulroney sticker" giving the suggested price of the car, pasted in the window.

In this sales battle the independents got swamped. Not only Studebaker but Packard, Nash and Hudson had trouble selling cars against this cut throat competition.

Studebaker sales dwindled away year by year. With shrinking profits they did not have the money to invest in new engines, suspension, chassis and bodies. They fell farther behind and were gradually forgotten by younger buyers. In the end they closed the South Bend plant and made a few thousand cars a year at their small Canadian branch plant. Then in 1966 they threw in the towel.

 

Says the guy who can't spell ugly, or except. Studebakers rock dude.

 

What happened to Studebaker is the same that happened to a dozen other manufacturers after WW11. There were too many manufacturers and some would not survive. Studebaker had as good a car mechanically as Chevy and Ford. But buyers would begin to reject them...just like they did the others that closed. Was it styling?....quality?....marketing?.....probably all. But the same could be said about the others who went out of business. And most of us are aware only one pioneer American manufacturer has never closed or gone bankrupt.

 

This is probably the most accurate description of why Studebaker went under.,

Truth is that despite the company narrowly making a dollar, It was insisted that the shareholders kept getting big dividends even at the cost of updating and redesigning mechanical and physical looks of the cars.

It was thought that the company should not let the shareholders loose faith even when the cash to pay the stock holders was robbed from updating things
(-things like a new design for a truck (instead of taking the front half of a Studebaker Lark and lobbing the rear doors off to form a truck cab),
(then contracting with Dodge to buy truck boxes, as well as taking a bunch of left over "Champion" fender emblems and cutting the "ion" off to form the new script for the "All New" Studebaker Champ" )

No, instead Studebaker thought that the shareholders should have all the working capital which in turn left nothing for the company to run on.




.

 

As a studebaker owner,I would say some are beautiful, but i wouldn't go on about the craftsmanship. There are some pretty sad cost cutting measures built into some of those cars.

 

no balls leadership, lawyers and union issues.

 

studebaker never closed, they are still in business, just not makin cars, in the 60' they became know as studebaker worthington ind. they owned paxton supercharger, stp yes andy granitelli was a studebaker employee when he wore the famous stp suit at indy. gravley tractors, the studebaker truck plant became am general they guys who made the hummer

studebake rhas been very good at keeping current prodcuts, from carriages to cars and now the equipment leasing company there current product

 

They sold sooo many Avantis that it overwhelmed the factory and the employees sending them into a downward spiral

 

Actually, had Studebaker been able to fill all of the orders they had for Avanti's things may have turned out quite different.
They simply could not build and deliver them fast enough.

Also another little known fact is that Albert Broccoli and Pinewood studios wanted a Avanti for James Bond to drive in Goldfinger, but Studebaker could not afford to allocate one to the studio as they were so far behind with actual orders.