Hi
Recently I've read the book "Champion of the Lark" by Robert Ebert, examining Harold Churchill's 1956-1961 presidency of Studebaker-Packard. It's an excellent book, a worthwhile read for all SDC members and automotive historians in order to understand the situation in which the cars were conceived and the motivations behind those decisions.
In the financially precarious days of late 1957, product planning for 1959 was well way. Churchill presented three options for consideration at the October 31st board meeting, summarizing:
Option 1: Continue the complete full-size lines with a general restyling. Tooling estimate was $4.2 million, by dropping the Packard, it would be reduced to $3.25 million.
Option 2: Develop a compact car within one of the following programs:
Plan 2A: Build four and two door sedans on 108.5" wb, add a station wagon if possible. Retain both Hawks unchanged. Tooling estimate was $5.843 million. Break-even point estimated at 121,000 units.
Plan 2B: Build four and two door sedans on 108.5" wb, plus a station wagon on 116.5" wb. Retain both Hawks and the Y-Body sedan on 120.5" wb. Tooling estimate was $7.287 million. Break-even point estimated at 115,000 units.
As background to their ultimate decision, the 1957 model year was turning out to be mostly a holding action against completely a new Chrysler Corporation line, new Fords and Mercurys, increasing strength from AMC's Rambler even as Nash and Hudson faded. And GM just kept steamrolling along. The upward trend in Rambler sales paralleled the increases in import volumse along with the bright spot that Scotsman had become. All that augured well for the success of a compact Studebaker.
As the board turned its attention to 1959, optimism for improved 1958 business was still alive, the steep economic downturn just beginning. Few would have expected its depths or disastrous result. In addition to the encouraging Scotsman sales, Hawks were on pace to outsell 1956 and the Packard Clipper was moving in the volumes expected. Although President Classics weren't equaling 1956 volume, that was understandable with the Clipper Town Sedan now sharing the showroom. What mattered was these high-unit-profit Y-Body sedans were selling a combined total greater than the prior year. This last point was an important consideration for 1959.
Assessing each option in light of the above and with hindsight:
Option 1: Continued as constituted, the 1958 model line-up, largely restyled and refreshed but essentially a holdover of all models and body styles. Telling is that even at this stage when Packard sales were meeting forecast, the demise of the make was on the table. This option, had it been chosen, short of a restyling so complete, including the greenhouse, as to represent a totally new car, would have failed miserably in the face of the 1959 opposition. Ford, fielding it's conservatively Thunderbird-styled cars, held the line but an all-new Mercury made no headway and Edsel simply failed. Chrysler retrenched after it's 1957 skyrocket crashed in 1958 abetted by the self-inflicted reputation for poor quality plus recession. DeSoto, squeezed to death by upmarket Dodges and cut-rate Chryslers, competed right where the 1959 Packard would have. But chiefly, the completely new 1959 GM line-up with their long, low, dramatic lines would have only emphasized how outdated any again-restyled 1953 sedans were. There was an exception in that grim picture, see Plan 2B.
Option 2: President Churchill correctly read compacts as the port in the storm, the execution would be key. Of Plan 2A or Plan 2B:
Plan 2A: This would ultimately become the 1959 Lark and Silver Hawk. It's hard to argue with the success it engendered in the short run. Conjecturing, but central to creating a compact car with existing resources was to retain the existing body shell, reduce the wheelbase and overall length, apply new front and rear styling, thus creating new-appearing cars with the least tooling expense. The possibility of a station wagon was tentative though acknowledged as necessary. Interestingly, keeping both Hawks was entertained, though given their decent sales showing at the time, not surprising. While the tooling estimate was the lowest, note the break-even number was higher than Plan 2B. Break-even point was critical to profitability. Ultimately, the casualty of this program was the 1959 Golden Hawk and any luxury-performance pretense.
Plan 2B: By identifying the compact car and sporty coupe segments, Churchill had correctly recognized two growing market niches. The third niche was less obvious and unique to Studebaker: loyal buyers for whom only a full-sized long-wheelbase Studebaker sedan would do. Even as total yearly volumes slipped, the Y-body models continued to account for a solid ten percent of overall sales. In an analysis by Mr. Ebert of the business decisions leading to the South Bend Packards, published in the Automotive History Review Fall 2006, Issue No. 46 for The Society of Automotive Historians, page 7: "The gross profit per 1957 Packard was $382.55 or 146% of the gross profit on Studebaker cars." While that would include Country Sedans as well, 82% were Town Sedans accounting for the majority of the return.
Further supporting the idea for retention of the 1959 Y-body sedan, from the cited text, page 14: "The second option Churchill presented was to drop the larger Studebaker and Packard lines. The company could then concentrate on a new 108.5-inch wheelbase compact car and the Hawk. Byers Burlingame, Comptroller, stated that with the absence of larger, higher profit margin Packards and Studebaker Presidents, the breakeven level for the company would rise to 121,000 units (from 103,000 in 1958)." As these discussions were going forward, 52% of 57H models were President Classic sedans, excluding Hawks. The 1958 results would be 75% of 58H models were President sedans and 59% of 58L models were Packard sedans, again excluding all Hawks. Clearly, there was a basis to present at least a Y-body President, perhaps even a Commander version with 259 V8, appropriately trimmed for its price range. Econo-milers were just plus business without major expense.
Who were the customers for a 1959 President? They were the over 62,000 people who had bought, since 1953 and/or would buy through 1958, any of the various Y-Body Studebaker Presidents and Packard-Clippers, to say nothing of Commander owners moving up. Had only ten percent decided to trade for a new President, that would have been 6000 more high-profit -margin cars sold. It would have been a wise decision to included those on that basis. To delete a Y-body President from the showroom was to invite loyal full-sized Studebaker sedan buyers to depart in search of the passenger room and trunk space plus overall length and prestige fitting for their transportation and self-image needs. While one might think that Studebaker buyers were not interested in the opinions of others, the type of car one was seen driving was just as important to any President purchaser as it would be to any other medium-priced make owner.
As parallel and confirmation, one need only look to the results the Ambassadors produced for AMC. Bridging to the 1956-Rambler-based cars dominating their 1958 lines, the issue existed to offer loyal Nash and Hudson owners a type of car that would be large and upmarket enough to be acceptable. Keeping them in the fold was certainly critical to success. Even as basic Rambler sales exploded, the Ambassador still added another 9% to the total volume. One can assume that they were high-profit-margin cars as well.
For a 1959 President, tight finances would have allowed only a light restyling , though visual tie-ins such as a Lark/Hawk trapezoidal grille, Hawk-style tailights, holdover rear bumper, various side trim/fins from both 1958 President and Packard rearranged for a new look, plus a Packard/President style interior and 289 engine could have completed the package. Although, seriously challenged by competing Big Three 1959 models, keeping more Studebaker loyalists returning to showrooms was key. Another possible ten percent or more added to Lark volumes would have been icing on the cake. Ultimately here too, as with Plan 2A, the casualties of this program were both the 1959 Golden Hawk and President, perhaps even Commander and Econo-miler taxicabs versions as well.
What put an end to this concept? In a word, undercapitalization. Note Plan 2B had the costiest tooling bill of the lot. Much of what would be built for 1959 was predicated on financing generated by strong 1958 sales; they had no other resources to turn to after so many money-losing years. As those sales continued to seriously deteriorate, buoyed only by the Scotsman, another financial crisis reared up, one threatening to scuttle the whole operation before the Lark ever made it to market. Author Ebert details the tribulation Churchill negotiated in the latter months of 1958 to restructure company debt in order to keep operating, make it to new car introduction. Though detailing how he did it is beyond the scope of this discussion, a reading makes clear Churchill was a man of his convictions that the compact car would be a successful avenue and fought to make it happen. It remains a shame he wasn't able to give us further Golden Hawks and Presidents but to his credit guided the company to its last great sales success.
Your comments and observations welcomed.
Steve
Recently I've read the book "Champion of the Lark" by Robert Ebert, examining Harold Churchill's 1956-1961 presidency of Studebaker-Packard. It's an excellent book, a worthwhile read for all SDC members and automotive historians in order to understand the situation in which the cars were conceived and the motivations behind those decisions.
In the financially precarious days of late 1957, product planning for 1959 was well way. Churchill presented three options for consideration at the October 31st board meeting, summarizing:
Option 1: Continue the complete full-size lines with a general restyling. Tooling estimate was $4.2 million, by dropping the Packard, it would be reduced to $3.25 million.
Option 2: Develop a compact car within one of the following programs:
Plan 2A: Build four and two door sedans on 108.5" wb, add a station wagon if possible. Retain both Hawks unchanged. Tooling estimate was $5.843 million. Break-even point estimated at 121,000 units.
Plan 2B: Build four and two door sedans on 108.5" wb, plus a station wagon on 116.5" wb. Retain both Hawks and the Y-Body sedan on 120.5" wb. Tooling estimate was $7.287 million. Break-even point estimated at 115,000 units.
As background to their ultimate decision, the 1957 model year was turning out to be mostly a holding action against completely a new Chrysler Corporation line, new Fords and Mercurys, increasing strength from AMC's Rambler even as Nash and Hudson faded. And GM just kept steamrolling along. The upward trend in Rambler sales paralleled the increases in import volumse along with the bright spot that Scotsman had become. All that augured well for the success of a compact Studebaker.
As the board turned its attention to 1959, optimism for improved 1958 business was still alive, the steep economic downturn just beginning. Few would have expected its depths or disastrous result. In addition to the encouraging Scotsman sales, Hawks were on pace to outsell 1956 and the Packard Clipper was moving in the volumes expected. Although President Classics weren't equaling 1956 volume, that was understandable with the Clipper Town Sedan now sharing the showroom. What mattered was these high-unit-profit Y-Body sedans were selling a combined total greater than the prior year. This last point was an important consideration for 1959.
Assessing each option in light of the above and with hindsight:
Option 1: Continued as constituted, the 1958 model line-up, largely restyled and refreshed but essentially a holdover of all models and body styles. Telling is that even at this stage when Packard sales were meeting forecast, the demise of the make was on the table. This option, had it been chosen, short of a restyling so complete, including the greenhouse, as to represent a totally new car, would have failed miserably in the face of the 1959 opposition. Ford, fielding it's conservatively Thunderbird-styled cars, held the line but an all-new Mercury made no headway and Edsel simply failed. Chrysler retrenched after it's 1957 skyrocket crashed in 1958 abetted by the self-inflicted reputation for poor quality plus recession. DeSoto, squeezed to death by upmarket Dodges and cut-rate Chryslers, competed right where the 1959 Packard would have. But chiefly, the completely new 1959 GM line-up with their long, low, dramatic lines would have only emphasized how outdated any again-restyled 1953 sedans were. There was an exception in that grim picture, see Plan 2B.
Option 2: President Churchill correctly read compacts as the port in the storm, the execution would be key. Of Plan 2A or Plan 2B:
Plan 2A: This would ultimately become the 1959 Lark and Silver Hawk. It's hard to argue with the success it engendered in the short run. Conjecturing, but central to creating a compact car with existing resources was to retain the existing body shell, reduce the wheelbase and overall length, apply new front and rear styling, thus creating new-appearing cars with the least tooling expense. The possibility of a station wagon was tentative though acknowledged as necessary. Interestingly, keeping both Hawks was entertained, though given their decent sales showing at the time, not surprising. While the tooling estimate was the lowest, note the break-even number was higher than Plan 2B. Break-even point was critical to profitability. Ultimately, the casualty of this program was the 1959 Golden Hawk and any luxury-performance pretense.
Plan 2B: By identifying the compact car and sporty coupe segments, Churchill had correctly recognized two growing market niches. The third niche was less obvious and unique to Studebaker: loyal buyers for whom only a full-sized long-wheelbase Studebaker sedan would do. Even as total yearly volumes slipped, the Y-body models continued to account for a solid ten percent of overall sales. In an analysis by Mr. Ebert of the business decisions leading to the South Bend Packards, published in the Automotive History Review Fall 2006, Issue No. 46 for The Society of Automotive Historians, page 7: "The gross profit per 1957 Packard was $382.55 or 146% of the gross profit on Studebaker cars." While that would include Country Sedans as well, 82% were Town Sedans accounting for the majority of the return.
Further supporting the idea for retention of the 1959 Y-body sedan, from the cited text, page 14: "The second option Churchill presented was to drop the larger Studebaker and Packard lines. The company could then concentrate on a new 108.5-inch wheelbase compact car and the Hawk. Byers Burlingame, Comptroller, stated that with the absence of larger, higher profit margin Packards and Studebaker Presidents, the breakeven level for the company would rise to 121,000 units (from 103,000 in 1958)." As these discussions were going forward, 52% of 57H models were President Classic sedans, excluding Hawks. The 1958 results would be 75% of 58H models were President sedans and 59% of 58L models were Packard sedans, again excluding all Hawks. Clearly, there was a basis to present at least a Y-body President, perhaps even a Commander version with 259 V8, appropriately trimmed for its price range. Econo-milers were just plus business without major expense.
Who were the customers for a 1959 President? They were the over 62,000 people who had bought, since 1953 and/or would buy through 1958, any of the various Y-Body Studebaker Presidents and Packard-Clippers, to say nothing of Commander owners moving up. Had only ten percent decided to trade for a new President, that would have been 6000 more high-profit -margin cars sold. It would have been a wise decision to included those on that basis. To delete a Y-body President from the showroom was to invite loyal full-sized Studebaker sedan buyers to depart in search of the passenger room and trunk space plus overall length and prestige fitting for their transportation and self-image needs. While one might think that Studebaker buyers were not interested in the opinions of others, the type of car one was seen driving was just as important to any President purchaser as it would be to any other medium-priced make owner.
As parallel and confirmation, one need only look to the results the Ambassadors produced for AMC. Bridging to the 1956-Rambler-based cars dominating their 1958 lines, the issue existed to offer loyal Nash and Hudson owners a type of car that would be large and upmarket enough to be acceptable. Keeping them in the fold was certainly critical to success. Even as basic Rambler sales exploded, the Ambassador still added another 9% to the total volume. One can assume that they were high-profit-margin cars as well.
For a 1959 President, tight finances would have allowed only a light restyling , though visual tie-ins such as a Lark/Hawk trapezoidal grille, Hawk-style tailights, holdover rear bumper, various side trim/fins from both 1958 President and Packard rearranged for a new look, plus a Packard/President style interior and 289 engine could have completed the package. Although, seriously challenged by competing Big Three 1959 models, keeping more Studebaker loyalists returning to showrooms was key. Another possible ten percent or more added to Lark volumes would have been icing on the cake. Ultimately here too, as with Plan 2A, the casualties of this program were both the 1959 Golden Hawk and President, perhaps even Commander and Econo-miler taxicabs versions as well.
What put an end to this concept? In a word, undercapitalization. Note Plan 2B had the costiest tooling bill of the lot. Much of what would be built for 1959 was predicated on financing generated by strong 1958 sales; they had no other resources to turn to after so many money-losing years. As those sales continued to seriously deteriorate, buoyed only by the Scotsman, another financial crisis reared up, one threatening to scuttle the whole operation before the Lark ever made it to market. Author Ebert details the tribulation Churchill negotiated in the latter months of 1958 to restructure company debt in order to keep operating, make it to new car introduction. Though detailing how he did it is beyond the scope of this discussion, a reading makes clear Churchill was a man of his convictions that the compact car would be a successful avenue and fought to make it happen. It remains a shame he wasn't able to give us further Golden Hawks and Presidents but to his credit guided the company to its last great sales success.
Your comments and observations welcomed.
Steve
Kevin Wolford reported being at the Museum Store this morning (October 1) and the DVDs were sold out! 
More are on the way, though, so "don't touch that dial" if you want one. 
BP
We've got to quit saying, 
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