An appropriate Labor Day question – Did the union help to kill Studebaker?

[Andy R.]

I was coming in at a 4. The Churchill interview and the Tribune article by Phil Ault were very informative. THAT was journalism!

1 or 2.

[decappastubbie]

That was a great newspaper article. I was in the eighth grade when Studebaker closed South Bend. My dad's family owned Studebaker and this cause for great concern as I remember it. A year later I bought my first car, a 1952 Commander four door.

[t walgamuth]

I like Churchill's comments. Labor cannot decide what products are offered. As I understood it car production was profitable when they closed shop, but not as profitable as other enterprises owned by the company.

[studefan]

Wasn't there but from all I have read and from hearing other labor union stories, I would say high at an 8.

[sweetolbob]

In the May,2013 issue of Turning Wheels Harold Churchill said the union did not contribute to the downfall of Studebaker.

Not blaming anyone in particular but seemed to be a lot of fiddling while whole thing burned.

Bob

[Chris_Dresbach]

Before commenting, I would recommend reading this article. It's from December 10th, 1973. Ten years after Studebaker announced that they were ending production in South Bend. It's from the South Bend Tribune, but it gives an unbiased, neutral view of what really happened once the dust settled.
http://www.studebaker-info.org/TW/tw0174/tw0174p08.html

[Bob Langer]

In the May,2013 issue of Turning Wheels Harold Churchill said the union did not contribute to the downfall of Studebaker.


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[sweetolbob]

If you look at what has brought the auto companies close to bankruptcy recently it has been poor management,defined in several ways, and the cost of labor, including productivity, wages, benefits and legacy costs. My guess is Studebaker was in a similar situation so a (5) from here. That is an equal share of the blame.


Bob

[JimC]

My personal and humble opinion would be dead center on the scale at 5. As I understand it, Studebaker union workers were among the best compensated in the auto industry. Not the kind of position a company teetering on bankruptcy should be in. If the unions were aware of the precarious position the company was in, they should have acted with more compassion for the company.

On the flip side, the company had some moments of less than stellar leadership, especially the board in place when production was moved to Canada. Letting someone who was an accountant but not remotely a car guy take the lead was one of many bad calls. They needed a Steve Jobs, but got a Rick Waggoner.

At the end of the day, we can play Monday morning quarterback all day long, but I don't think it's possible to blame one side or the other. A lot of variables went into the end of Studebaker. Keep in mind that in their Canadian years, they were turning a profit, despite GM squeezing them with the added costs for motors and everything else. Yet they still ended production. The bottom line may very well be that their hearts just weren't into the cars anymore, and once you lose your heart for something, it can fail, even if it has all the earmarks of a potential success.

[SN-60]

Benefits earned over time through contract negotiations tend to 'filter down' to folks that work in non-union shops....without labor unions, many rather talented, hard working people would be working for minimum wage...or less.

[Chicken Hawk]

I would go with about 7. I recall being around 27 years old and the union went on strike (I think it was around 1962 but could be off a year or two) and when they went on strike they already were making more per hour, had more and longer breaks, and better benefits than GM's Delco Remy employees in Anderson, Indiana.

Now what is your figure Dick?

Ted

[SN-60]

1.......or less!

[stude dude]

There was an interesting discussion in one recent Studebaker article about the real cost of the strike in 1962. Beyond lost profits, there was lost production, market share, momentum and public confidence, all at a time when things looked like they may slowly turn around.

This was probably a more damaging event than the Avanti production failures or various negative newspaper articles.

So I would say - 8!

Chris.

[Swifster]

I would also say 3...

I put the blame mostly on the Studebaker management. They wouldn't take a strike, the '53 models, the price war between 1953 & 1954 and the '58 recession... They would have been far better off building Packards.

[jclary]

I am probably one of the least qualified to comment on this. (Of course...when has that ever stopped me.) But, more than one ex-Studebaker person has told me that the Unions knew the precarious position Studebaker's automotive market share and financial health was. Therefore they would target Studebaker (as the last of the big independents) first for negotiations. When Studebaker capitulated to the demands of the Unions...then they would use that contract as a model to attack the big three.

Not being a student of business of the era...I'm not aware of the chronology of events or truth of the facts. Looking back...the failed deal with Toyota was probably the best "lost opportunity" for the continuation of Studebaker as a viable builder of vehicles. (Just my oversimplified and unqualified opinion.)

I'm gonna give the Union impact a 5. There's lots of blame to go around, but I do believe the unions played a significant role.