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

[Stu Chapman]

From a standpoint of Canada, the union contribution to Studebaker's closing would absolutely be a MINUS 1. Our management relations with the union were very good and the line workers were very enthusiastic. Looking at South Bend I would have to say that I would place the rating at 1. There were certainly some problems in 1962 when Sherwood Egbert punched out a striker and was charged with assault, but that strike didn't contribute to our downfall.

For those who have forgotten, my long time friend and associate, Ed Dunbar joined Studebaker on January 1st 1964 with specific responsibilities for "divestments". Ed had previously been with Curtiss-Wright and his Studebaker contract was negotiated in 1963, BEFORE the December 9th 1963 closing announcement. He was hired specifically to begin the planning of the end of the Automotive Division.

You had to be involved as closely as I was to know that Studebaker's failure was multi-facetted but top management engineered our demise, not the unions. Randolph Guthrie and Byers Burlingame were merely paying lip service to our efforts to succeed.

Stu Chapman

[t walgamuth]

Similarly to GM a few years ago, I believe STudebaker had a big bill for pensions that loomed on the horizon. I believe I read or heard that that was a consideration too. The pension liabilities became a liability with a shrinking market share (same as GM).

[2moredoors]

When I was a union representative I was often reminded that it was "management's right to manage". When I became a manager I was told the use of overtime was the penalty management paid for "poor management". It is my opinion that unions should adopt a policy of proper workplace environment workplace safety. The market will dictate wages, if Studebaker paid more than its competitors then management should not have agreed to it. I agree with others who blame "greed" a major contributing factor.
However if I had been a shareholder and the automotive division was constantly bleeding "red ink", I would have supported its demise.

[Chris Pile]

Similarly to GM a few years ago, I believe STudebaker had a big bill for pensions that loomed on the horizon. I believe I read or heard that that was a consideration too. The pension liabilities became a liability with a shrinking market share (same as GM).

However, if management had made decisions that actually put money in the bank - the pensions would not have mattered.

If GM wasn't encumbered by such monolithic management, they'd still be kicking butt in the marketplace.

In a capitalist country, if the company is making beaucoup from good decisions - all other problems can be taken care of.

[Jackson]

[studefan]

Jackson, well said from someone that was right there. Thanks for the personal insights.

[Alan]

I would say 5 too. Plenty of blame to go around. I have worked in union shops and non union. My personal experiences were like in #19. The unions had their goons or business reps. as they called them and the shop stewards were just a bunch of lazy bums. Management had their share of prize packages too. Stuff rolls down hill and where do you think the line workers were?

[Chris_Dresbach]

As a manager for over 20 years with the Postal Service, I once heard the same quote that "failure is ALWAYS management's fault". I believed it then and still believe it now. Blaming the unions is a cop out for not doing whatever it is that needs to be done to be successful. Perhaps Studebaker's leaders were simply more interested in making money than building cars. They had some mighty powerful forces that wanted them out of the competition. I think the big three knew how cool studebakers were and were even more so determined to put them out of business. JMHO

I think you hit the nail on the head. It even says it in the article I posted the link to that Studebaker had an option in the early '60s. They had money, and they had the option of investing it into their plants and new models, or they could diversify their business and buy other corporations. STUDEBAKER MANAGMENT FELT THAT THERE WAS MORE MONEY TO BE MADE BY BUYING OTHER CORPORATIONS INSTEAD OF MAKING CARS. If you really think about it, Studebaker never formally went out of business. The ended auto production, merged with Worthington to form Studebaker-Worthington, and then they got bought out by Cooper Industries who is still in business today. I don't blame the union for Studebaker closing, the executive big wigs WANTED OUT OF THE AUTO BUSINESS.

[SN-60]

Very true Chris. Anyone who blamed the 'union shop' for causing the cessation of Studebaker vehicle production was wrong in '66, and is STILL wrong. 'NUFF SAID!!!!!!

[jimmijim8]

Gee, you would think this kinda behavior was part of their job description. Sounds like a place where I was employed. Maybe that is whyscome the bankruptcy/closing. cheers jimmijim

I should add that labor is not completely blameless. Where I worked the laziest bums in the shop were the same guys who were always screaming loudest about management, spending time in the union office filing useless complaints, hollering about not enough over-time, and then turning it down, or sitting on their butts after clocking in.

They didn't like guys like me who worked hard, wasn't afraid to talk to the bosses like human beings about problems, kept my promises, and didn't squawk about striking every time a contract was up.

[SN-60]

I should add that labor is not completely blameless. Where I worked the laziest bums in the shop were the same guys who were always screaming loudest about management, spending time in the union office filing useless complaints, hollering about not enough over-time, and then turning it down, or sitting on their butts after clocking in.

Chris,....You're going to find workers like that whether they're union or non-union. You're really speaking of the person's character here. (His/Her work ethic)

[stupak]

What group of people/organizations do you suppose is responsible for the mass job loss from the USA to Mexico and overseas??? Dah! stupak

[bezhawk]

What group of people/organizations do you suppose is responsible for the mass job loss from the USA to Mexico and overseas??? Dah! stupak

That would be the greedy s.o.b.s that MANAGE or OWN the corporations....you don't think it was about dividends do you?

[stupak]

No....it was about the unreasonable 'organizations' demands regarding wages and benefits. Why pay $35.00 per hour for something that can be done offshore for MUCH, MUCH less? I know, I know - offshore crap. But.....in many cases, the offshore crap today is not bad. AND, what do you think lead many American corporations to improve their quality? You think it was their 'caring' for their customers? stupak

[BobPalma]

Jeff Rice andf Stu Chapman: Good Posts in #24 (Jeff) and #31 (Stu).

Stu: I was surprised to see you mention Randolph Guthrie and Byers Burlingame in the same vein. I guess I never knew much about Mr. Guthrie...and already know more about Byers Burlingame than I care to.

I always had a more positive "vibe" about Hamilton assembly line workers and thus appreciate and understand your assessment. There was a good deal of pride in "Building Studebakers for the World" after January 1, 1964, was there not?

Dick Quinn: What would be interesting and instructive here would be for you to expound on labor's attitude and role in Studebaker's 1933 / 1934 receivership and reconstruction.

The company was not unionized at the time, was it? As such, is there a record of workers generally having a positive, constructive attitude toward helping out, going an extra mile (or 30 minutes!) toward helping Studebaker survive?

Those years were the depth of The Great Depression, so did the Receivership Team enjoy extraordinary co-operation from employess genuinely thankful to have a manufacturing job during that time...or how do you read it? BP