The last years and the MLW connection

[BIGDoer]

I have always been curious - if you break down production per month averaged out, sales figures for 1966 were ahead of 1965. I heard 20,000 per year was the break even point and for 1966, they were well on their way to beating that. Assuming sales stayed at the same level through the rest of the year. Did management not see this as a positive, or were they set in shutting it down regardless?

I have also read at a railfan forum that at that time, the Montreal Locomotive Works who was quite successful in the 60s, was interested in purchasing what was then left of the Studebaker auto emprire. Plant included I guess. Is there anyone with more information on this?

As things would have it, MLW later became part of Worthington in the late sixties.

Thanks,

[Skip Lackie]

The issue of whether Stude was genuinely trying to stay in the automobile business after 1963, or used the move to Canada as a way to starve its dealers into cancelling their contracts, has been discussed here many times. The evidence for the latter includes the fact that the company was spending almost no money on refreshing their styling -- this at a time when new styling every year was almost mandatory in North America. The company had also dropped all the "sexy" models from their lineup -- Avanti, Hawk, and even the Daytona hardtop and convertible (which had previously been made in Hamilton). This was not a company that was making plans for staying in the automobile business over the long term. The break-even point at Hamilton has been variously described at 20,000 to 30,000 cars, and you are correct that they should have come close to that. But the future looked grim, with little or no money for restlying and a moribund product line.

As I recall, in the early 60s, MLW was owned by Alco. Would MLW have had the authority to do anything on its own? Are you suggesting that Alco/MLW would have bought Studebaker as a car-builder, or just purchased the remaining physical plant after they had quit the business?

Skip Lackie
Washington DC

[monomaniac]

"I have always been curious - if you break down production per month averaged out, sales figures for 1966 were ahead of 1965. I heard 20,000 per year was the break even point and for 1966, they were well on their way to beating that."

I disagree with that observation. For the 1965 model year Studebaker produced 17,287 vehicles PLUS 2,160 CKD units. For the 1966 model year they produced 8,935 vehicles ending production in mid March. At the same monthly "average" rate, Studebaker might have achieved an annual output of 15,600 at most (assuming they had kept building cars until end of July). They were NOT ahead of 1965 production. Unless sales and orders had increased dramatically they would not have reached the 20,000 figure. Whether they were at a break even point or near it is another matter but 1966 production was definitely lower than 1965.

[Roscomacaw]

Well, here's my question to add to this: WHY did they even bother to do the facelifting and interior make-overs they did for 1966? One would think that with that 1965 ad campaign about a "common-sense car", that the 64-65 styling would've done just fine! And thruth is, I'll bet the difference in sales of 66 editions (simply perpetuating 64=5 styling) would've been pretty minor at that.[^]


1957 Transtar 1/2ton
1963 Cruiser
1960 Larkvertible V8
1958 Provincial wagon
1953 Commander coupe
1957 President two door

[avantilover]

Maybe for two reasons Bob - (1) So they had a freshened up car to offer in case sales picked up (2) To fool the dealers/public/industry that they were staying in the auto business. In the end I suppose they looked at the projected sales volume and called it quits rather than continuing, though perhaps the company cvould have kept making cars as a minor part of the corporation's business.

Only corporate minutes (if any on this subject) could reveal the truth, but they certainly seemed to "shaft" Stu and Gordon and the rest of the Canadians.

John Clements
Avantilover, your South Australian Studebaker lover!!!
Lockleys South Australia

[BIGDoer]

quote:Originally posted by monomaniac

"I have always been curious - if you break down production per month averaged out, sales figures for 1966 were ahead of 1965. I heard 20,000 per year was the break even point and for 1966, they were well on their way to beating that."

I disagree with that observation. For the 1965 model year Studebaker produced 17,287 vehicles PLUS 2,160 CKD units. For the 1966 model year they produced 8,935 vehicles ending production in mid March. At the same monthly "average" rate, Studebaker might have achieved an annual output of 15,600 at most (assuming they had kept building cars until end of July). They were NOT ahead of 1965 production. Unless sales and orders had increased dramatically they would not have reached the 20,000 figure. Whether they were at a break even point or near it is another matter but 1966 production was definitely lower than 1965.

Goodness, perhaps my boo-boo. I assumed the data I saw was broken down by calender, rather than model year. In which case, indeed the 66s were not selling well.

[BIGDoer]

quote:Originally posted by Skip Lackie

The issue of whether Stude was genuinely trying to stay in the automobile business after 1963, or used the move to Canada as a way to starve its dealers into cancelling their contracts, has been discussed here many times. The evidence for the latter includes the fact that the company was spending almost no money on refreshing their styling -- this at a time when new styling every year was almost mandatory in North America. The company had also dropped all the "sexy" models from their lineup -- Avanti, Hawk, and even the Daytona hardtop and convertible (which had previously been made in Hamilton). This was not a company that was making plans for staying in the automobile business over the long term. The break-even point at Hamilton has been variously described at 20,000 to 30,000 cars, and you are correct that they should have come close to that. But the future looked grim, with little or no money for restlying and a moribund product line.

As I recall, in the early 60s, MLW was owned by Alco. Would MLW have had the authority to do anything on its own? Are you suggesting that Alco/MLW would have bought Studebaker as a car-builder, or just purchased the remaining physical plant after they had quit the business?

Skip Lackie
Washington DC

Hi Skip,

I am currently looking for the reference I saw. It's obscure and brief and buried, but I know it's here somewhere.

I understand that MLW was doing pretty well in the mid 60's, more so than parent Alco, so perhaps they were flush with cash and feeling cocky thinking they could make a run at making cars. I believe MLW was at least somewhat autonomous from it's parent, so perhaps this make some sense.

I'll find that MLW reference.....

Thanks,

[PlainBrownR2]

quote:
As I recall, in the early 60s, MLW was owned by Alco. Would MLW have had the authority to do anything on its own? Are you suggesting that Alco/MLW would have bought Studebaker as a car-builder, or just purchased the remaining physical plant after they had quit the business?

This is something of a highly complicated question considering MLW's history. In the early days prior to ALCO, MLW was mainly a domestic builder(meaning Canadian only) of steam locomotives. When ALCO bought MLW in 1904, it was mainly for the Canadian designs. However, Canad's trade policy forbid importing ALCO's American designs into Canada until after WWII, so MLW built Canadian engines, but ALCO used the Canadian designs in the American engines.

After WWII, MLW went back into engines(they mfr'd the RAM tank and Sexton self propelled gun during the war), but they started to transisition from steam into diesel. They still were not receiving American engines yet due to policy, but they received some new competition. EMD established GMDD in Canada and CLC partnered with Baldwin in the US. When Baldwin disappeared CLC then went to licensing FM engines, but mfr'd FM engines for the Canadian market. FM's designs included the famous Trainmasters down here(which were a mainstay for the Virginian railroad, a partner to the N&W). CLC also produced industrial engines for GE, which didn't happen until they dissolved the partnership with ALCO.

Now it really gets interesting. In 1949, MLW mfr's ALCO derived designs for the diesel locomotive to compete with GMD. For 1951 they begin manufacturing ALCO-GE cab units(not F unit type of engines) to use in freight and passenger service. At this point the trade policies start to lighten up on the Canadian side. MLW begins exporting engines to the US, but the US wasn't importing engines into Canada.

In 1964 ALCO was having financial problems, so Worthington bought up ALCO. MLW would have then followed with ALCO since ALCO bought them up as a Canadian subsidiary. For the next part here if there's any discrepancies, I apologize. In 1967 Worthington bought up the Studebaker Corporation, which became Studebaker-Worthington. At this point, we know the story with the automobile business with the Studebaker side. If there was a shot, Worthington may as well handed ALCO the Studebaker factory that was now eking out parts and gave them the details about their business on auto production(yall can fill in the gaps here much more than I could, lol). In 1968, the ALCO divisions started becoming independent subsidiaries and in 1969 Studebaker Worthington locked the doors on ALCO in Schenectady. The designs were moved to MLW-Worthington and the diesel engine designs went to White Motor Corporation.

In, short yes they had authority to operate on their own, they had to, to keep pumping locomotives out in Canada. But, they were under the ALCO banner, so ALCO would have had the final say on the locos as a whole. However, they didn't want to be producing carbon copies of ALCO's so they have variants of ALCO's designs. The design I can think of at the moment was the M-420W, which had the wide cab that later would become a standard on US locomotives.

I'm no expert on Canadian engines, although I have photos of CN 2816 with the Hiawatha in tow, so here's my quickie reference I used:

http://en.wikipedia.org/wiki/Montreal_Locomotive_Works

[IMG=left]http://i158.photobucket.com/albums/t102/PlainBrownR2/55%20Studebaker%20Commander%20Streetrod%20Project/P1010531-1.jpg[/IMG=left]
[IMG=left]http://i158.photobucket.com/albums/t102/PlainBrownR2/55%20Studebaker%20Commander%20Streetrod%20Project/P1010550-1.jpg[/IMG=left]
[IMG=right]http://i158.photobucket.com/albums/t102/PlainBrownR2/Ex%20Studebaker%20Plant%20Locomotive/P1000578-1.jpg[/IMG=right]
[IMG=right]http://i158.photobucket.com/albums/t102/PlainBrownR2/My%201964%20Studeba

[Skip Lackie]

quote:Originally posted by avantilover

Only corporate minutes (if any on this subject) could reveal the truth, but they certainly seemed to "shaft" Stu and Gordon and the rest of the Canadians.

John Clements
Avantilover, your South Australian Studebaker lover!!!
Lockleys South Australia

Yeah, it would be nice to see what the corporate board minutes said. Does the museum have them, or did they stay with the corporation?

Last year, Dick Quinn posted a letter from Byers Burlingame to Gordon Grundy that basically told Grundy that the corporate board had disapproved nearly all of his requests for restyling and engineering money. (As far as I know, we do not have a copy of Grundy's earlier letter to Burlingame that requested the funds.) I interpreted that letter as proof that the board was purposely starving the car division, but not everyone agreed with that view. In fact, Grundy may very well have been let in on the secret by that time, and may have written his letter just for the record. That said, Stu Chapman and the other members of the Hamilton team were clearly doing their best to stay in the car business.

Skip Lackie
Washington DC