When the Hudson Jet was first announced in 1952, company officials thought the compact sedan would be a renaissance for the venerable automaker. Today, many historians will tell you it was Hudson’s fatal mistake. This week, we look at the origins and history of the much-maligned 1953–1954 Hudson Jet.
HUDSON, ESSEX, TERRAPLANE
As automobiles and automotive brands fade into history, one thing that’s often lost is a sense of their original socioeconomic position. It’s becoming difficult, for example, to grasp that the Chrysler badge once possessed a fair degree of prestige, or to assess the class distinctions implied by driving an Oldsmobile rather than a Chevrolet. For the same reason, unless you’re a fan of the marque, it may surprise you to know that Hudson was once quite an expensive car. It wasn’t at the level of Packard or Marmon, but it was the price of several Model T Fords, enough to keep it out of reach of even lower-middle-class buyers.
Whatever the snob value of an upmarket brand, there’s comfort in volume, especially in tough economic times. For that reason, Hudson made several stabs at offering smaller, cheaper products to complement the middle-class line. The first of these was the four-cylinder Essex, launched in January 1919. The Essex, which initially started at $1,595, was by no means an inexpensive car, but it undercut the cheapest Hudson Super Six by nearly $400, giving it a considerably broader appeal. The introduction of the Essex allowed Hudson to triple its 1918 sales volume, which was undoubtedly reassuring in the face of the severe postwar recession that followed.
The Essex is best remembered today for the Essex Coach, launched in 1922. The Coach, developed by Hudson engineers Millard Toncray and Stuart Baits and built by the Briggs Body Co., was the first moderately priced closed body in American production. With a starting price of $1,495, it was still $300 more than an open Essex — nearly the price of an entire Model T — but that was a much smaller premium than any rival charged. Hudson steadily reduced the price and by 1925, the Coach was actually slightly cheaper than an open Essex touring car. The Essex Coach precipitated an industry-wide shift to closed bodies, where they’d previously been restricted to luxury cars and limousines.
The Essex was a great commercial success and by 1929, it had the number-three slot in domestic auto sales. Hudson’s combined volume reached about 300,000 units, its all-time high.
The Crash brought Hudson’s prosperous streak to a screeching halt. Its 1930 volume was less than half the 1929 total and 1931’s sales were barely half of 1930’s. Hudson’s response was to move even further down-market, with the 1932 Essex Terraplane. Priced to compete with Ford, Chevrolet, and Plymouth, the Terraplane shared the Essex’s 193 cu. in. (3,165 cc) six, but it rode a new, shorter chassis and was more than $200 cheaper.
The Terraplane was not a smash hit, but it did respectable business in the worst part of the Depression. For 1933, all Essexes became Terraplanes and there was even a Terraplane Eight, powered by a 244 cu. in. (3,998 cc) straight eight with 94 hp (70 kW). By 1934, the Terraplane brand had completely supplanted the Essex and began moving back toward the mid-price field. By 1937, it was bigger than the old Essex and priced in the same class as Dodge and Pontiac.
Terraplane was successful enough that A.E. Barit, who had replaced the late Roy Chapin Sr. as Hudson president in early 1936, became concerned that it was cutting too deeply into Hudson sales. Terraplane was outselling Hudson by more than four to one by then, which was bad for the company’s profit margins. In 1938, Hudson launched a new, cheaper “112” model (so named for its 112-inch/2,845mm wheelbase), which undercut the cheapest Terraplane in both size and price. Hudson subsequently phased out the Terraplane marque, which was discontinued entirely in 1939.
The 112, renamed Traveler, continued through 1942, but it did not return at the end of the war as Hudson decided to concentrate production on the more profitable Super and Commodore lines. By 1947, the cheapest Super Six was over $1,700, well out of the low-priced league.
In late 1947, Hudson introduced its first postwar designs: the 1948 “Step-Down” cars. Sleek, low-slung, and surprisingly agile, despite their tank-like “Monobilt” construction, the new Hudsons did well in the booming postwar market. Hudson sold over 117,000 cars in the 1948 model year and over 159,000 in 1949, the best the company had done since the Crash. Hudson racked up a $12 million profit, also quite good.
By the summer of 1949, however, Hudson’s lack of an affordable entry-level model was becoming a problem. The cheapest 1949 Hudson, the Super Six business coupe, was more than $2,000, as much as a Buick Super or Oldsmobile Rocket Eighty-Eight. The latter comparison was particularly troubling because the ’49 Olds came standard with both a new OHV V8 engine and Hydra-Matic, neither of which Hudson could match at any price.
For 1950, Hudson launched a cheaper Pacemaker series, reviving a name it had used intermittently in the mid-thirties. The Pacemaker shared the big Hudsons’ Monobilt construction, but rode a 5-inch (127-mm) shorter wheelbase and had a smaller engine. It was about $170 cheaper than the Super Six, starting at just over $1,800. The Pacemaker still wasn’t an inexpensive car — it cost as much as a Pontiac Chieftain Eight — but it did well, accounting for about half of Hudson’s 1950 sales.
The success of the Pacemaker suggested that there would be a market for an even smaller, less expensive Hudson, a modern successor to the old Essex and Terraplane.
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I’d read the (also very good) [i]Collectible Automobile[/i] piece on the Jet, so I was eager for more. My reaction at that time was that if A. E. Barit knew more about styling than Frank Spring, he should have fired Spring, installed himself as head of styling, and had done with it!
I note the comment about the Jet having good adhesion, but with a lot of body roll. As a man who’s owned Peugeot 504’s, I would have been OK with that.
Former [i]Road & Track[/i] editor-publisher John Bond once termed the Jet “an outstanding American car that was far ahead of its time.”
It’s important to remember that for a long time, few automakers gave their styling chiefs an actual executive position. Harley Earl became a corporate vice president in 1940, which gave him a lot of clout. After the war, he was on the same level as the divisional general managers, so disputes had to be resolved by upper management, where he had a lot of friends. At most other companies, the lead stylist was a director — even Ford didn’t add the VP of styling position until 1955.
That was the problem Frank Spring had. He technically reported to Millard Toncray, the head of engineering, and both Toncray and Norman VanDerzee outranked him. I’m not sure to what extent Spring was even present in the meetings where the final decisions were made. It was like a major or a colonel disagreeing with the decisions of the generals; their opinion doesn’t necessarily count for much.
I think Jim Moran’s influence had a lot to do with it. I’ve seen that happen a lot at various companies: the senior executive is already unsure or uneasy about something, and then an influential external voice pushes him or her in one direction or another. Moran was a big deal at Hudson, and a big deal in general (as his later career suggests).
Unlike Dick Langworth and some other historians, I don’t think that Frank Spring’s original plan would have been a great improvement. It would have looked something like that four-door Italia prototype, but with a drooped nose, like the ’53 Studebaker coupe. Had Spring won out, I think this story would be largely the same, except that later historians would substitute “if only it hadn’t looked so weird and Continental” for “if only it hadn’t looked so frumpy.”
Spring’s corporate relationship to Millard Toncray was mirrored exactly at Nash.
Ed Anderson, Director of Stying at Nash, reported to Meade Moore, the Vice-President of Engineering. In fact, I’ve read from Patrick Foster that Anderson retired from AMC precisely because he felt that he had earned a vice-president’s title. AMC, apparently for a variety of reasons, disagreed.
One more note: Roy Chapin, Jr., told me in 1998 that Barit had insisted on the Jet’s roof being high enough to accommodate a man wearing a hat. Perhaps that would account (a little) for the Jet’s awkward height.
[quote]Ed Anderson, Director of Styling at Nash, reported to Meade Moore, the Vice-President of Engineering. In fact, I’ve read from Patrick Foster that Anderson retired from AMC precisely because he felt that he had earned a vice-president’s title. AMC, apparently for a variety of reasons, disagreed.[/quote]
Yup. This was apparently something George Mason felt strongly about — he was concerned that if Nash allowed its in-house stylists to become too powerful or too prominent, they would parlay that into a career elsewhere. (As I recall, it stemmed from bitterness toward George Walker, who’d been a Nash consultant in the forties.) That was apparently part of the reason for crediting Pinin Farina for the ’52-’54 Nashes, although Mason told Anderson it was purely for marketing reasons.
Barit, like K.T. Keller at Chrysler, was definitely big on the idea that you shouldn’t have to take off your hat when you got into your car. He tried to get Spring to raise the roof of the Step-Down cars for that reason, and I don’t doubt that it became an issue with the Jet, as well. Aside from hat room, Barit also insisted on chair-like seating, rather than the low, Mercedes-like seats Spring wanted, and that demanded a higher roof. From a packaging standpoint, it wasn’t a bad idea — a lot of modern B-segment cars do the same thing, for the same reason — but it didn’t help its looks!
Forgot to mention: AMC President Roy Abernethy pulled a "Barit" a decade later when he asked the designers of the Marlin to do the SAME EXACT THING. They were forced to raise the roof line of the Marlin by one inch to accommodate guys wearing hats.
That one inch destroyed the Marlin’s looks and helped to place it on the road to Failuretown.
I’ve never heard that Mason was concerned about keeping stylists in the background. Matter of fact, Anderson didn’t really pitch himself as a Vice-President until after Mason was dead.
If that’s true, then he surely made a mistake with George Walker, who, as I’ve heard, pitched the design for the ’49 Ford to Nash before he went to Ford. If what you say is true, then Mason’s fear about designers was realized by his own actions.
But I’m wa-a-a-ay off topic. My original point is that history apparently teaches us nothing. We keep seeing the same design mistakes over and over and…
I haven’t had the time to dig up my source for Mason’s attitude — it was probably in Michael Lamm and Dave Holls’ book — so I wouldn’t swear to it, but my recollection was that Mason was quite put out with George Walker. I believe Mason felt that the design of the ’49 Ford was something Walker had originally done for Nash, and since (at least in Mason’s mind) Walker had only gotten the Ford account on the strength of his work for Nash, it was particularly galling. It was well before Anderson was even hired, so it wasn’t related to him specifically. My impression was that Mason was too good a manager to express his feelings to the styling staff in that way, but I believe it affected his thinking.
As with the Jet, I’m not convinced that the Tarpon/Marlin would have sold any better with a lower roofline or on the smaller platform. [i]Car Life[/i], driving a ’67 Marlin (which most agree is the best-looking of the bunch), dissected its marketing failure pretty astutely — that it wasn’t startingly attractive, it wasn’t especially fast, it didn’t handle exceptionally well, and wasn’t all that luxurious or prestigious — and most of that would have been true of the Tarpon, as well. I’ve seen pictures of the Tarpon model, and while it’s better looking than the early Marlin, I think it probably would have sold about as well as the Barracuda.
But to your point, no, nobody ever learns in any sustained way. (Ironically, one of the few counter-examples was Packard’s George Christopher, who did show signs of learning from his mistakes, just not fast enough to do any good.) At the Big Three, particularly, there was so much executive turnover that the division managers would often be promoted and gone before the commercial ramifications of their decisions ever became clear — failing upward, as the saying goes.
Another great article. The Hudson Jet is a very rare bird, even at AACA events. I believe that I have seen two over the years – one at the big Hershey AACA fall meet, and the other in a junkyard outside of Carlisle, Pa.
A big reason compact sales never took off in the early 1950s was that the standard Chevrolet-Ford were not that big. In your article on the 1960s Ford Fairlanes, you noted that the 1955-56 Fords and Chevrolets represented the “sweet spot” for American car buyers in the size department. Sales of the 108-inch-wheelbase Rambler were fairly strong for 1957, but Rambler sales really took off for 1958-59, when Chevrolet, Ford and Plymouth were engaged in a size and styling war.
A 1959 Chevrolet not only sported outlandish styling, but was also much larger than before (making it harder to park). Its extreme lowness hampered exit and entry, while giving drivers and passengers the feeling that they were sitting directly on the floor. The Rambler was relatively upright (which meant that it was roomy and easy to enter and exit) and easier to drive and park in crowded settings.
Not only did Rambler sales in 1959 set a record for an independent make, but the relatively boxy and prosaic Ford, with its squared-off Galaxie roofline, came very close to outselling the Chevrolet that year.
While the Rambler was certainly not better looking than the Jet, it was distinctive, and Nash was much smarter in how it marketed the Rambler. Nash introduced the well-trimmed versions and upscale bodystyles (hardtop, convertible) first.
The Rambler was also available as a station wagon – a huge bonus, and the only compact that offered this option in the early 1950s. Station wagons were new and a growth market at this time.
It was the wagon version that put the Rambler on the map – but the Jet, Henry J and Willys Aero didn’t bother with this bodystyle. To me, THAT was a huge mistake, and a big reason why the Nash Rambler was able to gain a foothold in the mid-1950s. Wagons were a very high percentage of Rambler sales through the early 1960s (and AMC’s loss of this market, as it pursued sales of convertibles and fastbacks, was a big reason it went into a tailspin in the mid-1960s).
George Mason and George Romney definitely had a far more astute idea about the challenges they faced in marketing the Rambler. It’s significant, for instance, that the Jet’s only body styles (two- and four-door pillared sedans) were the ones Mason was most hesitant to introduce, because the convertible, wagon, and hardtop were perceived as the more upscale (and more expensive) models.
The little wagon did sell well, but I think that was as much because the Landau wasn’t terribly practical as a reflection of buyer interest. Once Nash introduced the hardtop coupe (and later the longer-wheelbase sedan), those quickly outsold the wagon. The wagon was definitely a unique item, though, and probably the handiest of the bunch.
The Rambler’s fortunes were definitely improved by the 108-inch and 112-inch wheelbase versions, which had more workable packaging for American buyers. Even though the Jet was bigger than the 100-inch Rambler, a lot of buyers complained about rear legroom being inadequate. It’s too bad that Barit was apparently insistent on the 105-inch length; another couple of inches would have improved both rear-seat space and proportions. (If it had been FWD, the 105-inch wheelbase probably would have been perfectly adequate, but there’s a reason most modern B- and C-segment cars are front-wheel drive. Later Rambler American sedans had the same issue — the rear axle and rear wheelhouses cut sharply into back seat space.)
I disagree that AMC stumbled because it pursued convertibles and hardtops at the expense of wagons. Rambler, after all, offered convertibles and hardtops early on, even before the AMC merger. By the sixties, wagons were not the growth market they were in the fifties. Certainly, the younger crowd didn’t want them, at least not until they started having kids in the seventies. I think that AMC’s stumble had more to do with the fact that they moved away from Romney’s brand image without a clear idea of what would replace it, so it just became like the A&P store brand version of the Big Three.
Where was Chrysler in all this? If they sat out the price war, I’m guessing that they fared better than Hudson because even if they didn’t match Ford and Chevy’s prices, they had full-size cars of fairly recent design and greater financial reserves than Hudson.
That’s a good question. Plymouth sales for 1953 were better than they had been in a while — about 650,000 units — but they were way behind Chevrolet and Ford. Plymouth had the benefit of deeper pockets and greater economies of scale than the independents, and they had a facelift for ’53, but they still didn’t have a true automatic, which was becoming a problem. I think Chrysler tried to keep up as best they could, but they didn’t post the kind of (artificial) gains that Chevy and Ford did.
It’s a wonder that Hudson was able to sell ANY Jets at those prices. Few people (unless they were hard-cord Hudsonophiles) would be likely to spend more money for a Jet than a mid- or hi-line Chevrolet or Ford. And how about spending almost an additional $100.00 for the two engine upgrades which together providing a whopping 10 horsepower? BTW, the picture of the 1952 Ford sedan pictured in the article is labeled a Crestline. A sedan did not become available in the Crestline series until 1954. The car pictured is a Customline.
Thanks for the note on the photo — you’re quite right. Fixed.
I think the fundamental problem with the Jet is that Hudson hadn’t really thought through who it was marketed for. It was economical, but it wasn’t an economy car; it was fairly well trimmed, but it wasn’t a junior luxury car. Except for the early Terraplane, Hudson never really competed in the low-priced field (even the Pacemaker was more in Dodge/Pontiac territory), but the Hudson badge didn’t have the cachet of Buick or Chrysler. Nash, which had the same dilemma, understood it much better, and made a more deliberate effort to position the Rambler as the upscale second car for Lincoln or Cadillac buyers.
Oldsmobile and Buick had a similar problem a few years later with the early Y-body F-85 and Special. While they were cheap for an Olds or a Buick, they weren’t inexpensive, and buyers initially seemed unsure what to make of them. They didn’t really catch on until a few years later, after the Fairlane and Chevelle were well establish. Then, a Skylark or a Cutlass was the more-upscale version of the Malibu, which was finally a coherent niche. The Colonnade Cutlass cost more than the equivalent Malibu and wasn’t any bigger, but it had a bigger engine, better trim, and a more upscale nameplate.
Rambler scored its greatest successes in the 1957-60 timeframe, when it offered no convertibles or hardtop coupes.
The Rambler American, which was a revived version of the original Nash Rambler, did not offer any convertibles until the 1961 model year, and the “regular” Rambler Classic/Ambassador did not offer a hardtop coupe until 1964, or convertibles until 1965.
AMC spent a ton of money tooling up for convertibles in the Classic and Ambassador lines for the 1965 model year, and yet the sales were very low. AMC’s success from 1957-1963 was built on station wagons. If I recall correctly, the wagon version of the “standard” Rambler was the firm’s best-selling vehicle for several years.
As for what happened to Chrysler during the Chevrolet-Ford sales war – Chrysler didn’t really get hit hard until the 1954 model year. Sales hit the floor, and market share dropped to about 13 percent (in the early postwar years its share had hovered around 20 percent). Stodgy styling and the corporation’s slowness to make a fully automatic transmission available throughout the entire line also hurt Chrysler.
Plymouth lost third place to Buick that year, and some sources say it slid down to fifth place (behind Oldsmobile, too).
In some ways, Chrysler never really recovered from the 1954 debacle. The highly styled 1957 models were a reaction to Chrysler’s sales slide in 1954 (Colbert wanted Chrysler to be renowned for styling, and to beat GM in that area), and they sold well for one year.
But they were rushed to market, and when they started to fall apart and rust within one year, Chrysler’s sales again hit the floor. By 1962, its market share was actually BELOW its share in 1954!
Another thoughtful and well-researched article. Only a few quibbles, e.g., are you sure the Packard V8 cost $20 million? Patrick Foster stated that AMC’s first small-block V8 tallied $10 million. Does your figure include the Utica plant and/or upgrades to the Ultramatic transmission?
I wouldn’t reject out of hand Hudson’s ability to survive if it had focused instead on updating the step downs. By 1955 Hudson surely could have purchased or jointly developed a V8. Meanwhile, a new body with a low beltline would have given Hudson a competitive advantage through 1956. Kaiser’s failed attempt to go down that road isn’t a compelling cautionary tale because of its lack of a step-down chassis and the fledgling company’s shaky reputation.
You may be right that the impact of the Jet’s dowdy styling has been overstated. However, the Willys Aero was not an ideal point of comparison. While the Aero arguably had the fewest design negatives in its class, Willys was also the smallest independent. I suspect that Willys’ limited coin would have been better spent updating and expanding its Jeep line rather than trying to reenter the passenger car field just as the post-war boom was ending.
The $20 million figure (which is an approximation) came from James Arthur Ward’s book on the fall of Packard. I believe it includes tooling costs, but I don’t think it reflects changes to the Ultramatic. I don’t [i]think[/i] it includes the actual cost of the Utica plant, only the expense of setting it up for the new engine. If I recall correctly (I don’t have the book at hand), the cost was originally budgeted at $17 million, but ran over that by around $3 million.
As I told another commentator on the Packard story, I don’t think AMC’s V8 development costs can be directly compared to Packard’s. For one, AMC’s deal with Packard had AMC underwrite a portion of Packard’s development costs in exchange for access to the R&D notes (in addition to the actual engines and transmissions purchased). Furthermore, some sources suggest that AMC’s eventual 287/327 engine was at least partly based on a V8 that Kaiser had developed (but not had the money to build) several years earlier. As a result, AMC was not starting from a clean sheet of paper in the way Packard was. Even if the $10 million figure is an apples-to-apples comparison — which I’m really not sure about — it’s reasonable to assume that it would have cost AMC more if not for the previous R&D work.
In hindsight, it would probably have done the independents a lot of good if they had agreed around 1951 to jointly develop a bread-and-butter V8 that they could all share, but for various reasons, they did not. Short of that, I don’t know where Hudson would have gotten the money to [i]both[/i] retool its bodies and develop a V8, nor is it obvious where they could have bought one. Would Studebaker have been willing to expand production to sell engines to Hudson? Could there have been a deal between an independent Hudson and Packard to buy engines and transmissions, as there was (briefly) between AMC and Packard? Maybe, but that becomes extremely speculative.
I was reading a history of the automobile industry since 1945 written in 1971 and the author devoted an entire chapter to the "small car story." In it he greatly criticized the pricing of the indepentents’ small cars, seeing their poor price considerations as a hurdle over which the claim "these cars were ahead of their time" could not clear. More interesting, I found, was the authors analysis of the Big Three’s slow entrance into the small car market, which he saw as a self-recognition of their interdependence. The author argued that no member of the Big Three would seriously enter the small car market until it was sure there was "room for all" and that the market could support the sales of small cars by all Three companies. This "room for all" theory is soemthing I hadn’t heard before in the usual analysis of Detroit’s early small cars, which mainly focus on their fear of losing out sales of bigger models and a firm belief that the right cheap car for americans was a used car. A fnatastic article, as always, but I wonder what you think of this "room for all" idea?
I should emphasize, first, that I think the price of the early compacts (particularly the Jet) was primarily a problem because it failed to meet the specific expectations of many of the buyers who were interested in — and in some cases, had asked for — a car like that. Consider the people now clamoring for the next-generation iPhone; as enthusiastic as they are, how many of them would be disgruntled if the next iPhone weighed five kilos and only worked if it were plugged into the wall? Even if it were otherwise a fantastic device, its take-up would be a lot lower than anticipated, because buyers expected something they could put in their pockets. People routinely paid (and still pay) more for what they perceive as high-value products, whatever those values may be.
I’d be curious to know what book this is — I’m not familiar with it. I think his theory is largely off base, however, or at least, that it draws faulty conclusions from the data.
The Big Three’s reticence to enter the compact market was primarily based on concerns about their own volume, which, until 1959-1960, were probably legitimate. Looking at the sales of domestic compacts between 1951 and 1958, the interesting thing is that the total changed very little, even as new players entered or left. It took the demise of most of Rambler’s competition to give it a volume that was sustainable. Even that was not much by GM standards — GM considered anything under about 250,000 units a year to be a small niche. What changed is that because of the Eisenhower recession and the public’s disgruntlement with Detroit’s excesses, sales of big cars began to drop. The Big Three weren’t sure if that was temporary or a real market readjustment, and they decided that they had to offer compacts to maintain their market share, even if it meant getting into a market on which they were none too enthusiastic.
I think the flaw in the author’s theory is the presumption that the small car market represented a [i]new[/i] market, which wasn’t really true, at least not until the late sixties. Some Big Three executives, notably Robert McNamara, thought the compacts would expand their market share, which really didn’t happen. The new car market in the U.S. didn’t start to grow dramatically overall until the mid-sixties, when the Baby Boomers started hitting driving age. Before that, the compact market was largely made up of existing buyers who had become dissatisfied with the standard products for various reasons (price, size, economy, styling). As a result, marketing small and intermediate models was a matter of hanging onto those buyers, not of jumping into a new market.
Now, there is a slight grain of truth in the author’s theory, in that GM (and really only GM) senior management did live in mortal fear that if they got too big, the Justice Department would break up the corporation on anti-trust grounds. However, those fears did not really translate at the division level, which in the late fifties and early sixties was where most product and marketing decisions lay. If you were the general manager of Buick or Pontiac, you knew that your bonus and future success in the corporation depended on improving your sales figures, market share, and ROI, and it didn’t matter much whether you achieved that by creating a new product category, by stealing buyers from the competition, or by poaching the territory of other GM rivals; that wasn’t your problem. GM’s senior officials occasionally made a big show of crocodile tears about it, or about the downfall of the independents, but it never translated into any perceptible effort to stop it.
What happened to the independents — one company tries something new, and if it works, everyone else jumps on it — happened with the Big Three all the time, and there’s little evidence that they ever deliberately tried to leave room for others. The Mustang is an obvious example.
There’s an excellent article in last month’s Cars & Parts on the one-off Jet convertible.
I may be a bit late, but I found one mistake(altough I really enjoyed the aricle): the photo of the interior is actually a 1951-1953 step-down, not a Jet. Jets had a completely different instrument cluster (similar to the 1954 step-downs) and non-divided windshield.
Thanks for the heads up — I probably mislabeled my files and didn’t notice. When I have a few moments, I’ll look to see if I have a correctly labeled picture and swap it out.
That one appears to have actually been for a 1953 Hornet nearby. Sadly, I don’t have an actual dash photo for the Jet — curses!
Just came across this article, found it very informative and with great dialogue in the comments section.
Would like to share a few thoughts but first have a question. According to Richard Langworth’s book, Hudson earned $50M from 1945 thru 1952 then lost $10M in ’53 and $6M in ’54. What happened to the remaining $34M? Did it got to Defense investments? Stockholder dividends? The company tanked awfully fast in late 1953, driving Ed Barit to merge with Nash.
The Jet’s Financials
If we assume that Murray initially charged Hudson $50 per unit (Roy Chapin alludes to this in Langworth’s book) it would have taken 1.2 years to amortize the initial $12M investment assumption and 1.6 years to pay down the $16M final outlay. Further assuming that Hudson made $50 profit on each car, this would have amounted to a profit of $10M per year. Not bad economics but unfortunately based on a very poor volume call.
At a more realistic 20,000 units per year, or 1/10th the initial volume estimate, it would have taken 16 years to amortize the Jet’s $16M investment. Put another way, to amortize the $16M in 1.6 years, the $50 baked into the amortization schedule would have needed to increase to $500.
And the profits? At the lower volume, to generate even half of the desired $10M in annual profits would have driven the car’s $1,858 price up to around $2,658 accounting for the new amortization, 10% dealer mark-up and a per unit increase in advertising (volume has its benefits!), which would have torpedoed volume. Clearly not a viable program given the product offered.
Barit probably had a decent handle on the program’s projected costs having just gone through the exercise with the ’48 Step-Down. Contracting to Murray likely introduced new variables. In the end, the $4M investment over-run was a painful mistake but not a program-breaker and certainly nothing that would collapse the company. Barit’s big mistake was that he never directed his team to thoroughly stress-test the volume assumption. This could have been done with a clinic using production-representative clay models and interior bucks that were compared directly with Ford and Chevy cars, with specs and prices labeled and the used car option accurately represented. Done right this would have undoubtedly revealed that the program was a financial non-starter.
Was There Any Hope For The Jet?
Yes, there might have been an alternative design and market positioning opportunity. To explore it I created an image work-up that lowered the car similar to how Spring had wanted, by dropping the greenhouse about 3.8 inches, which removed the body section above the main vertical sweep of the side panels and repositioned the hood crease to directly above the grill. It also lowered the decklid relative to the rear fenders. The result was that overall height dropped from 60.8 to 57 inches and the car’s appearance improved greatly.
However, it wasn’t enough to make the car a genuine winner because now the greenhouse looked dumpy by comparison. To finish the task I had to rake the windshield and backlight several degrees, eliminate the wrap-around shape of the backlight, and lower the windshield header and roof by an inch. With these final changes height dropped to 56 inches, proportions became fully in balance and the car came into its own.
To really win, horsepower needed to increase, the suspension needed firmed up and a four-on-the-floor was needed to fully engage the driver. Base engine could have remained the flat-head 202 Six, which produced a decent 120/130 HP by 1955, but a more powerful, higher spec version was needed to drive pricing and build the car’s aura. Barit, ever the penny-pincher, could have worked from the 202, modifying it to use OHVs or even OHCs, the latter with 180 HP. On the inside, Italia’s multi-foam bucket seats and optional leather could have completed the transformation.
In 2-door form I think the car would have captivated buyers with “a certain zest for living” and not happy with the typical American car. As a 4-door though, the miserable rear legroom would have made it suitable only for families with three or fewer kids. Other body styles such as a convertible, 4-door wagon, 2-door delivery and 2-door pickup could have filled out the catalogue, the last two offered with cheap interiors and at low prices covering only material cost and the incremental investment needed to tool unique stampings, plus allowance for a small profit, and created to give the dealers extra volume.
The new series would have had a good chance of becoming America’s first premium sports compact along the lines of later BMWs, commanding the needed $2,658 and selling at the needed 20,000 annually and with appeal to global markets, which were steadily growing.
Could an all-new large Step-Down with great styling have been profitable? Langworth’s book says Hudson’s breakeven was around 75,000 cars. Twice that volume probably would have allowed a healthy corporate existence but to achieve it may have required that Hudson and Packard merge and share a common Mono-Bilt body. With Packard’s 225 HP 320 CID V8 powering the ’55 Hudson (the ’55 Hash had this motor in detuned form) and Packard running with the larger 352 CID unit, a pecking order would have been established. For appearance Packard could have featured a longer hood and rear overhang. And both marques could have used Allison’s Torsion-Level suspension. Looking back, its amazing how even though the two companies never merged, they shared or otherwise were connected to key technologies.
Should the X-161 have been Hudson’s new design theme? No!!! That is, not without Spring’s design excesses greatly tempered by Packard Design. An arguably better Hudson theme, had the merged company not launched its new cars until the 1956 model year, would have been Packard’s Panther concept of late 1953. I’ve long felt that with a different grill and Hudson’s traditional step-down unibody construction methods, the design would have made a wonderful mid to late-50s Hornet, especially in V8 form. Dick Teague had other themes in the hopper that were more suitable for Packard.
Hudson’s Overtures To Packard… an Alternate Ending
What if Hudson’s history had proceeded as written up to when Barit approached Nance in August, 1953 asking to merge. Only this time, instead of finding a company ready to launch boring carryovers that were doomed against all-new 1954 Buicks and Cadillacs, he discovered a fresh showroom with carryover sheet metal (they had “good bones”) that had been sectioned two inches, with Mayfair’s hardtop roof style, windshield and backlight on top, in an expanded series including a long wheelbase Formal sedan? With Packard’s financial prospects looking rather promising, Nance might have seen further growth potential by taking on Hudson and its dealers.
For example, had Packard’s lowered 1954 cars also included a step-down frame, maybe a new Hornet could have quickly been created for 1955 that sat on the short 122 inch wheelbase. Under this scenario Jefferson’s body operations would have either closed or, as a friend on mine has suggested, became the new source for Packard’s body stampings once Brigg’s Conner plant was bought by Chrysler (Colbert guaranteed Nance stampings only through 1954).
Alternatively or in addition, Packard planners might have envisioned fixing the homely Jet by making the changes described above, which for around $3M could have been readied for ’55.
Overall, I think both companies had much more potential in these years than historians give them credit for.
I agree about the Jet’s lack of financial viability. As it says in the text, I think the buyer interest Hudson anticipated was predicated on the assumption that the price would be much, much lower than it ended up being. Obviously, that was impossible, but the average person had no way of knowing that. As to your question about where their previous profits when, I’m not that familiar with Hudson’s financial details, although Hudson’s total profits during that period were not vast on a year-to-year basis and the company did spend some money on updating the Step-Down cars. That might be a good question for Dick Langworth, honestly.
I also agree that the X-161 was a nonstarter, design-wise. Honestly, I feel like it didn’t have a coherent theme. I think the Italia was okay from the rear and rear three-quarter, sort of in the same vein as the contemporary Ghia-built Chrysler show cars, but the nose is a mess and, if the prototype was any indication, the stuff that was pleasant on the Italia coupe was pretty dire when applied to a bigger four-door sedan. Hudson might have been obliged to tone it down for production (for practical reasons as much as anything else), but it would still have probably ended up as a cluttered agglomeration of silly ’50s rocketship nonsense. Buyers weren’t wholly resistant to that sort of thing (as the ’58 Thunderbird demonstrated), but in that segment, as a sedan? Nah.
I’m more skeptical of the idea that Hudson could have sold the Jet as a sort of proto-Mustang in that era. The sales of sports cars in the U.S. in that period were marginal — MG’s best year in this period was 1952, when they sold fewer than 7,500 cars in the U.S. (and some of those were sedans), and the early Corvette and Kaiser-Darrin didn’t do even that well. Granted, a better-looking Jet hardtop 2+2 would have been more practical than the roadsters, which might have helped, but I can’t see the results selling any better than the Jet sedan did. As for the engine, there was an interesting article in Motor Life in 1954 about its hop-up potential, which was, in a word, limited. An OHV conversion would naturally have helped, as would a supercharger, but it took Jaguar dual overhead cams to get 180+ hp out of a long-stroke engine in this displacement range. The bigger problem in that regard was that the Chevrolet V-8 would have done it mortal harm, market-wise, being cheaper and having an engine producing comparable or more power while being at the beginning rather than the limits of its development potential. I also can’t see a meaningful overseas market in the ’50s. The engine was just too big for France or Italy and would have made it a marginal player in the “eccentric high-roller” market for the U.K. or Germany; there were a few English or European buyers with that kind of money back then, but not many. For it to be viable in Australia, it would have had to have been assembled there (as local distributors did a few big Hudsons), but it still would have been very pricey and not well-suited to the roads. What you’re envisioning might have been neat and would certainly be a collector’s item, but I don’t think there was yet a meaningful market for it.
Regarding Packard and Hudson, the big priority for the Packard board was finding a volume partner. Since the thirties, Packard’s leadership had been convinced that the only way they could ensure their long-term stability was to boost their volume — George Christopher’s target had been 200,000 units a year, and that number was still kind of a shibboleth even though Jim Nance was belatedly beginning to realize that was not a realistic goal for the Packard brand per se. The issues with Hudson, separate from the fact that by the time Barit approached Nance Hudson was looking terminal, were threefold. First, Hudson’s volume wasn’t that much better than Packard’s and was sinking, partly due to the Korean War and partly because the Step-Downs were looking very passé and Hudson didn’t have anything especially new to offer (other than the Jet, q.v.!). Second, Hudson was awfully close to Packard, particularly the Clipper, in size and price, which was troublesome for a small player looking to shore up their volume. (Look at what happened with the overlap in Chrysler’s mid-price brands a few years later.) Third, Hudson’s Mono-Bilt construction, while it was certainly very sturdy, was a significant handicap commercially because it was more expensive to tool, more difficult to change without completely retooling, and (from a merger standpoint) would have made it harder to sharing tooling without having the resultant models end up looking the same.
There is an argument that Packard should have merged with Hudson for their production facilities, which in retrospect might not have been a terrible idea, but would likely have amounted to Packard absorbing and consuming Hudson, leaving only (maybe) a few and nameplates. However, that was really not what Packard was looking for, which is why they didn’t seriously consider it.
I do think that Packard was potentially salvageable at that point, and having a stamping plant that wasn’t contingent on Chrysler and that didn’t force the awkward consolidation they attempted for 1955 would have helped, but I can’t see Hudson surviving for long except to be basically cannibalized for its production facilities and remaining dealer network.
Ford’s customers wanted a faster horse but the ‘ole man thought differently. It is always much harder to create than to copy or pander. For me the biggest lesson of automotive history is in learning how to expand perspective. We know the American market eventually embraced high-spec, expensive small sedans. We also know that people are people and don’t much change over a period of 100 or even 1000 years, only see things anew based on education and experience. In this respect, Hudson’s biggest task in pulling ahead by 20 years an inevitable shift in the marketplace would have been one of evangelization. Put the car out there, let the motor magazines to fall in love with it, stay on message and be patient. It would not have taken long, not as long as it took an inexpensive compact like Rambler, because a fast, sporty, high quality, sweet handling Jet would not have depended on a recession to kick-start sales. The market was born ready, and wealthy enough in 1954, only needed a product. Imports of the day were too expensive and/or slow and sold by too few dealers. Only Hudson, the engineer’s company and stock-car king, had all the ingredients necessary to conceive, create, convince and distribute such a winner. Die-hard Chevy V8 folks might not have cared much about handling, but others would have appreciated the difference between hamburger and steak, if finally given the choice.
Hudson lopped off 2 cylinders to make the 202, why not 2 more for Europe?
There were a fair number of American cars of this era that were sold overseas, but they were really not suited to the needs and budgets of most available export markets. Even something like the Jet or the Henry J was pretty large for most countries and generally had to be sold as a luxury car, in small numbers. (To put this in perspective, a Super Jet sold in Belgium ended up being the equivalent of almost $3,000!) I suppose they could have created a 2.2-liter four for export, but that was still pretty rich for the time. European, Australian, and South American markets of the fifties were still at a point where what to us would have been rather small family cars were a stretch financially and big American cars (among which the Jet or something that size must be included!) were a curiosity.
Could Hudson have made a proto-pony out of the Jet? Sure. Could they have sold it in respectable numbers in America? Maybe, although I’m dubious. The lack of a V-8 would have hurt, especially once the ’55 Chevy appeared, and so would the price. I can’t see how Hudson could have sold a car like you’re describing for LESS than a Super-Jet or Super-Liner, and with an OHC engine conversion and other mechanical changes, it would likely have had to sell for significantly upwards of $2,000. At that point, would have been up against a Chevrolet Bel-Air with a V-8, which is a prospect that, had I been a Hudson dealer, would have made my blood run cold: more cylinders, as much power or more, sporty looks, more space, and vastly more dealer and advertising support. As for road manners, ’55 Chevrolet was not a sports car, but its suspension layout was exactly the same as the Jet’s, its steering wasn’t any slower, and it benefited from substantially wider tracks, so I’m not convinced the Hudson would handled meaningfully better (except in the sense of being generally more maneuverable due to its smaller dimensions) unless Hudson were willing to sacrifice a lot of ride quality, which wasn’t a tradeoff a lot of American buyers were eager to make.
Also, I think it’s worth remembering that a lot of the success of the pony cars, or for that matter of Pontiac in the late fifties through the sixties, was a product of very aggressive marketing. Ford certainly did not just toss the Mustang out there and hope for the best! Could Hudson have done that? To some extent, although Hudson obviously wasn’t in a position to spend the kind of money that Ford or Chevrolet did on advertising and marketing. Would they have? The most successful “sporty youth market” efforts of the sixties raised a lot of eyebrows even internally because automotive marketing and sales people tended to be a conservative and rather hidebound lot. It was risky, and it would have been more risky for Hudson because they didn’t have anything close to the kind of financial cushion to absorb serious miscalculations that Ford or Pontiac did.
I fully agree that people don’t change that much that quickly, but the counterpoint of that is that people also don’t change their habits without substantive reason. Returning to the thesis of this article, the failure of the Jet, and the Henry J, and the Aero Willys, in the U.S. market in the fifties came because in the early fifties, there was no compelling reason for most American buyers to bother with cars smaller than the contemporary American norm. They weren’t cheaper (or at least not enough), there was no significant tax advantage, and gasoline was cheap enough that gas mileage only became a concern at all if the economy suddenly slipped as it did in 1957. By the late fifties, some full-size cars were getting big enough to be a hassle, but most drivers weren’t zooming over curvy mountain roads or narrow country lanes, at least not often enough to give up the implied status of a really big car.
The fact that median tastes have shifted toward marginally smaller vehicles is the current end result of decades of political, economic, and technological changes, including enough oil crises to make working-class and middle-class buyers at least intermittently nervous and the growth of imported European and Asian products that, by virtue of having been designed for markets more restrictive than ours in size and engine displacement, were better positioned to take advantage of said oil crises and economic insecurity (as well as buyer dissatisfaction with slipping quality control of Detroit products). Technological refinements have produced modern vehicles that often have as much or even more usable space than median American sedans of 40 to 60 years ago. A modern FWD car the size of the Jet is perfectly reasonable transportation for four adults; where there are failings in comfort, they’re usually due to infuriating interior design choices rather than the basic, “The wheelbase is this long, the transmission is here, and the rear axle is there, whatcha gonna do?” issues that limited the Jet or short-wheelbase Rambler. You also have generations of buyers who’ve grown up with smaller cars and who would consider something the size of a full-size American car of the late fifties or early sixties rather monstrous, just as European buyers did years ago. Even for all that, the average new passenger vehicle sold in the U.S. is still a bunch bigger than in any other market, particularly if you include trucks (which is really hard to avoid at this point). The main market for bigger sedans like the Accord/Camry/Fusion/Sonata is the U.S., a class that’s pretty near death in Japan and Europe except for a narrow category of ultra-premium cars.
People may not change much, but circumstances do, and with something as expensive as new cars or light trucks, that makes a lot of difference.
I should add that in 1954–55, the OHV V-8 Ford and Chevrolets that a “Hudsonstang” (Jetstang?) would have been competing with were not simply the choice of “diehard Chevy [or Ford] V8 folks.” Having modern OHV engines in low-priced cars — particularly Chevrolet — was new, novel, and very exciting. A decade later, a cheap American V-8 sedan or hardtop was pretty ordinary and not that special (which I think was part of the reason the pony cars became as successful as they did), but that definitely wasn’t true in the fall of 1954. If the Hudson you describe had debuted for 1953, as the Jet did, or even for 1954, it would have gotten a lot of press attention, but the ’55 Chevy would have overshadowed it pretty dramatically. When the ’55s came out, even Road & Track, which was extremely snooty about American sedans, was grudgingly impressed by the performance. (A V-8 car with manual shift and the 180-hp kit was almost as quick as a Jaguar XK-120, if not as fast at the top end.) A six-cylinder Hudson would have seemed like very old news at that point.
Many good points, Aaron. Especially like your comments about Mustang marketing, which Hudson would not have been able to match, and headwinds driving consumer preferences particularly in the Seventies. Regarding the curiosity of comparatively larger and more expensive cars in Europe et al, it is also true that Jaguar and Mercedes-Benz built post-war companies on it. Margins was the goal, not profit and this is where I think Hudson and Packard both needed to park themselves. To do it they needed to make really stellar cars that required no extra push on the market than the innate passion for cars that was already there.
Will stick with my assertion that the Chevy/Ford vs. lowered Jet was apples/oranges. It wouldn’t have just been the performance including handling. Hudson’s play was also interior refinement, which they were good at. I remember when the ’75 Accord came out. Nice interior and lots of standard items that others charged more for, if offered at all.
You may want to check my first post above, stated a much higher price for would-be lowered Jet than what was actually produced, and explained the numbers behind it. You have prompted me to ponder more. No, the Jet’s lower body would not have been optimal. I think it might have worked as stop-gap until a new design could be readied, but it might not have made (or lost) any money. Particularly when Nance might have entered the scene in late 1953, Hudson had already written down quite a bit of the Jet’s losses, so the per car burden for a lowered Jet might have been reduced a few hundred dollars and with it, pricing.
Having finally seen the Italia the other day up close, think it was the car Barit should have pursued all along. Properly cleaned up design-wise it would have had not much more material cost than the Jet and a whole lot more appeal. Needed to be a 2+2 though. Will send you work-ups of my latest thinking.
As it was, the Super Jet and Jet-Liner were really pretty nicely trimmed inside, so that’s reasonable enough. (I’m still kicking myself for not having tried harder to get interior shots; as someone pointed out, I’d mislabeled different, non-Jet shots and didn’t think about it until it was much too late to get proper ones!) On the other hand, so were the Nash Rambler Custom and the Chevrolet Bel Air, which were about the same price. So, it wasn’t a case of “ultra-plush compact for the price of a stripped-down full-size car,” which is a workable selling point; it was, “How can we get buyers to spend as much or more for a Jet than for a top-line Ford or Chevrolet?” Not an easy question!
I think comparisons to imported cars have to be carefully considered because there’s a lot of relevant context besides just size or price or even performance. European luxury car makers of the fifties were typically operating in protectionist markets where the number of people with sufficient income to afford anything more than a very basic, very tiny car was still quite limited and where tax restrictions, fuel costs, and/or road conditions all tended to strongly favor smaller vehicles. It was not that Mercedes-Benz or Jaguar had magically found a way to convince huge numbers of European buyers to pay more for smaller cars; by German or British standards, something like a Mercedes 220a or Jaguar Mark VII was a big car with a big engine for rich people.
To the extent that these cars were sold in America, which really wasn’t much in the fifties compared even to American independents, the central appeal was that they were foreign, which for Americans of the time connoted either “cheap and possibly very shoddy” or “rare and exotic.” It wasn’t a particular reflection of the virtues of the products except insofar as Jaguars and Mercedes were certainly neither shoddy nor at all cheap. As a counterpoint, consider the American failure of the Rover 2000 and Triumph 2000, cars that were very successful and profitable in their home market. It’s true that their failure here was due at least in part to reliability issues and the failings of the U.S. distribution network (discussed elsewhere), but mainly, they suffered from being perceived by American buyers as neither cheap nor exotic enough to justify either paying more than comparably sized domestic cars or getting a smaller car than you could have gotten for the same money from a domestic brand.
Packard merged with Studebaker mainly because Nance agreed to take them while Mason took Hudson, then the two would merge to create the Big 4th. After Mason passed unexpectedly, the grand plan unraveled. At its core it seems that what messed the whole thing up was that Mason, Nance and Vance all wanted to be the leader, which led them all to wait for the others to falter, which cost valuable time. If they had approached it in terms of what was best for the product, Hudson and Packard would have quickly merged, gotten on a common platform and dueled its dealers, with Packard exiting the upper medium segment and encouraging its owners in that segment to choose Hudson for their next car or step up to a Packard. Nash and Studebaker would merged and gotten on a medium-sized platform, with Nash above Studebaker. I think this is roughly how GM worked, with Cadillac and upper Buicks sharing the C-body, lower Buicks and upper Oldsmobiles sharing an offshoot of C called B, and Chevy, Pontiac and lower Olds on the smaller A. In the late 50s GM might have consolidated even more.
Packard and Hudson would have each had unique front fenders, hood, fascias and rear quarters, with the end panel in front of the decklid being longer on the Packard. Same with Nash and Studebaker. Rambler would have complicated things. Had the Big 4th gotten strong fast, it might have been able to carry 3 platforms, Rambler being the smallest and used as a second model range for Nash and Studebaker. More likely, I think the group would have been hard-pressed just to do two new platforms right. The ’56 Rambler, while still small, would have served Nash and Studebaker’s needs going forward, as history showed, but they might not have realized that at the time.
In retrospect, Hudson’s collapse in late ’53 may have initiated ALL the mergers. Had they never done the Jet and instead fielded a better Hornet/Wasp in ’54 (or earlier), Barit likely would have never agreed to Mason’s terms, and instead survived to use Packard’s V8 in 1955. Packard, in turn, may have never merged with Studebaker, instead going it alone and getting financing for its new ’57 program. Whether Nance would have continued to pursue Clipper as a separate brand or tie the knot with Hudson would probably have depended on whether Barit was willing to relinquish control, which he probably would have given his age.
An offshoot of this alternate storyline is that Packard would have merged with Studebaker despite Hudson’s continued independence, and S-P collapsed as happened in early 1956. Now Hudson could have bought Packard’s Utica V8 engine and plant on the cheap and maybe even picked up Packard, quickly closing its operations and creating a Packson.
Of course, none of this happened and Hudson became a Hash, then poof, gone.
I don’t think the evidence supports your reading of the rationale for the Studebaker-Packard merger. I would really recommend James Arthur Ward’s book The Fall of the Packard Motor Company, if you haven’t read it, which draws heavily on Packard board minutes for a lot of insights into why the company did or didn’t do various things (which sometimes differed a lot from what Jim Nance wanted). Again, the board was driven by the idea that they need a mass-market partner to shore up their volume. They had rejected the prospect of a merger or production partnership with Nash, ironically for many of the same reasons that the plan to integrate with Studebaker ended up being messy. As for leadership clashes, the issue was really Nance and Romney, not Nance and Mason. Mason was over 60 at that point, more than 10 years older than Nance or Romney, and I don’t think Nance (or Romney, for that matter) was adverse to a couple of years as president with Mason as chairman, which seems a fairly likely configuration if it had come about.
Again, from the Packard board’s perspective, I don’t think Packard had much to gain from a merger with Hudson — except stamping facilities, a significant issue that didn’t get enough consideration until things had gotten more difficult. Certainly, the idea of sharing a newly developed body shell to establish commonality for multiple divisions wasn’t a bad one, but it requires having the capital to set up, which neither Hudson nor Packard really did, and having a reasonable expectation of sufficient volume to pay off the investment, which was very dicey. Hudson could not do a lot with the existing Step-Down cars that wouldn’t have amounted to a too-obvious facelift and tinsel-shuffle. While it might have been possible to fiddle with the Packard shell to create a “Hackard,” I’m not sure I see the point from a commercial standpoint, not without a new shell.
The other issue is that by then, Packard had really surrendered a lot of its credibility as a luxury brand for the mid-priced field, which is not something that’s easy to reverse, especially since neither Packard nor Hudson was a strong contenders in that segment by this point. If you’re having trouble getting customers to spend, let’s say $2,500 on your products, are those same buyers going to be keen (or able) to spend $3,000? Mercury ran into that when it tried to abruptly move upmarket in 1957–58, which was completely disastrous. That was also the issue for Chrysler a few years later. By the late ’50s, it would have made a lot of sense from a brand-positioning standpoint to phase out the Windsor and leave that price segment to Dodge and DeSoto, but the Windsor was also by far the bestselling Chrysler model and the sales organization and dealers would have rioted.
As far as trying to shift buyers to Hudson, that would have been tricky as well. Would you have wanted to roll the dice on how many remaining Packard customers were there for whatever luster the badge still had? Would the dealers have wanted to take that bet? Packard and Hudson could not have unilaterally forced dealers to take dual franchises either. Some would probably have been okay with it, but some would have balked and either jumped ship or sued (or more likely both). Depending on the existing franchise agreements and individual state laws (which tend to be on the franchisee’s side in this sort of thing), that could have ended up being ugly and quite expensive. It’s hard to predict how that sort of thing will go down and is obviously a completely speculative proposition at this remove, but automakers get very nervous about that sort of thing, which is exactly why after mergers you often end up with Hashes and Packardbakers (inter alia).
Couple points on that, Aaron. Yes, have read Jim Ward’s book and had a chance to spend a day with him at an automotive symposion several years ago. We both walked through the Lordstown assembly plant outside Youngstown and shared lots of laughs. He didn’t think Packard had much of a chance. I did. Didn’t matter.
I agree with you, the Packard Board was captivated by Studebaker’s volume. They were nothing if not consistent, becasue they had been just as incompetent before the war. They couldn’t get their own house in order, how did they think merging with anyone, let alone another basket case, would have helped?
I can’t agree that Nance’s ego was a small matter, quite the opposite and Ward mentioned it many times, as have others. All those CEOs thought they had a special gift that nobody else had. The best Nance comment I ever read was an interview he did long into his retirement. He actually admitted that he had lost the game. Finally! And I thought, good for you, Jim. Here was a guy who was able to admit his mistakes rather than blame everyone and everything else. Am sure he felt that given another chance he would have won the game. A spit-in-your-eye to the historians who have long said Packard and the others never had a chance. I am 100% with Mr. Nance. Most of those issues you mentioned are just everyday obstacles in the business. Winners manage them.
There’s a reason GM got so big. They produced the goods, in product and everything else. There was no data telling them to do the ’38 Sixty Special, the car that created the American 4-door segment still with us today. They dreamed it up mostly by themselves and had a gut feel that it would resonate. And they had the right people in high enough places to defeat the anti-bodies within the company to get it developed. Great example of how to win.
I don’t mean to downplay Nance’s ego (or Romney’s, although Romney in later years was better at sounding politic or gracious about it). My point was just that I don’t think Nance’s push for a Packard-Nash merger would have made a lot of sense if he saw George Mason as a long-term obstacle to his own power. I have to assume that because Mason was already in his early 60s by that point, which meant a good chance he would retire in the relatively near future. Nance would therefore have a couple of years to consolidate operational control over a much larger entity that he would then inherit, still giving him a decade or so at the top before his own retirement. He didn’t have any particular in-house competition for that role (which is why Packard had recruited him in the first place), so the main obstacle was Romney, whose position and ambition I think Nance originally underestimated.
I strongly reject the “winners go with their gut” line. I understand why it sounds good from an enthusiast standpoint and why it fuels nostalgia, but it really doesn’t hold much water. GM was always a finance-driven corporation whose defining virtue was capital, based for a long time on widespread diversification into many different businesses and sub-businesses. Even that diversification wasn’t really the product of canny strategy or great vision; Billy Durant acquired every company he could get his hands on while putting up as little actual cash as possible, and it was largely a matter of luck that he ended up with enough viable subsidiaries to weather the subsequent collapse of the nonviable ones. (His backers thought so too, which is why they forced him out in 1910.) By the twenties, GM, as a corporation, was in the position to act like a venture capitalist with a lot of family money to fall back on. They could buy or launch some business if it seemed promising and then cancel or sell it pretty ruthlessly if it didn’t seem like it was going to pan out or looked too far gone to bother saving. (They very nearly did that with Cadillac in the thirties.) There were people of passion or vision or whatever within the divisions, but the corporation didn’t play that way. GM had to be dragged kicking and screaming into any project that didn’t have rock-solid ROI potential (and that was true of Cadillac management and the Sixty Special, in point of fact) and the amount of sometimes-fatal second-guessing that created is very well documented.
The independents did not have a wealthy corporate parent that gave them an allowance and could be talked into financing a special project. Nor were they like Ford, which, along these lines, could be analogized as an affluent professional whose career pays well enough that it isn’t the end of the world if their occasional side venture fails. If the independents tried something that really didn’t work, or that cost more than they expected, or that customers just didn’t go for, it was calamitous. Even to the extent they tried to diversify (something that became a big preoccupation of the Studebaker-Packard board), doing that was expensive enough, proportionately, that it came at the expense of their automotive business because there was only so much cash; it was like a working-class person living out of their car to invest their rent money in stocks.
It’s disingenuous to point to a well-groomed rich kid who’s never had to worry about money in his life and say, “Why can’t you just apply yourself like him?” Comparing the independents to General Motors in the fifties is kind of like that.
Nance pushed for a Packard-Nash merger? No, he soft-peddled it and the main reason was Mason. Both wanted be in charge.
It’s important to get into Nance’s head in 1954. Besides trying to grow Packard, he was actually assessing his chances of securing a leadership position at Chrysler, including the top position. He was in his 50s and there would be no more waiting, his time had come. This is why he always sought deals that kept him in charge, even if, as with the Studebaker merger, the arrangement disadvantaged Packard.
In early 1954 a small group of Nash planners and designers, on direction from Mason, spent several weeks crafting a body sharing strategy for Nash, Hudson and Packard based on Nash’s shell. Mason used this as part of his pitch to Nance. What resulted? Nance heard him out but Mason was not allowed to pitch directly to Packard’s Board. Why? Because it represented a future in which Mason was driving the bus, which was a problem for Nance because he wanted to be first amongst equals in any merger discussion, and hadn’t whipped Packard into strong enough shape yet. In retrospect, the timing might have been right for Packard.
I acknowledge that Packard’s Board, proud of its company’s history and accomplishments, was not about to see EGB’s decades of hard work evaporate as it became an engine builder for a Kenosha-centric enterprise. And it is true, the Board was attracted to Studebaker because it was “the big earner.” What they failed to see was that Studebaker was an also-ran in the volume market and would never, ever get close to Chevy and Ford, which meant they would never achieve the scale needed to be strong and stable in the industry’s highest volume segment. Nor did Studebaker have any more chance of sharing bodies with Packard than Chevy did with Cadillac. Yes, Plymouth and Chrysler shared many body stampings in 1957 and even Chevy and Cadillac shared some stampings beginning in 1959, but in 1954 Packard’s Board was foolish, and some Packard stockholders were not shy about calling them on it, laying out a detailed indictment that year, with particular attention on Nance’s failings.
“Winners Go With Their Guts”
Forget nostalgia, guts is what is driving the industry today, witness Tesla! Let’s clarify thouh, “guts” does not mean taking direction from one’s passions any more than it means from one’s intestine. It’s shorthand for that special part of the brain that synthesizes and discerns the clear and muddy, the connected and disjointed, and the whispers and screams, and it represents a very high level of intellect. For setting strategy I’ll take it any day over a stack of MBA books, not because it rejects such these “facts” but because it comprehends and then places them it their proper, subordinate place.
GM absolutely earned its 1950s leadership position. It all started in earnest when Sloan hired Earl in 1927, which quickly led to GM becoming a styling leader. The company also pushed new technologies like independent front suspension and automatic transmissions. In the short span from 1933 to 1940, GM went from a big company in a big industry to THE big player, and Jolly Green Giant growing bigger by the minute, and everyone else’s expense. Look at what GM contributed to styling. First salvo was the 1933 Cadillac Sixteen Aero Coupe (yes, more impact than ‘27 LaSalle). Its balanced, measured streamlining established the center line in the Thirties that others either fell short of or over-reached. And then of course, the ’38 60 Special, which I doubt anyone within the company could say with certainly would deliver a specific ROI. How could a daring car that cost more than the standard 60 Series while offering less rear legroom, and carrying conservative Cadillac’s badge, be successful? They went with their guts because their guts told them folks would accept these to get a lower, wider car with better style and a bigger trunk, and even conservative folks had a zest for living. It only took a few months after launch for GM’s leaders to confirm that their gut had been right and that they could proceed with confidence in a good ROI with the REAL play: the 1940 C-bodies. These were the cars that made Packard so afraid “it couldn’t see straight.”
Had GM gotten the C-body bet wrong, you better believe it would have hurt. “The bigger they are, the harder they fall” was just as much a black cloud over GM during all these years in question as “size matters” was for the Independents.
That GM didn’t fall was mainly because it fairly consistently made good product decisions from 1934 on through the Sixties. Not that it didn’t dabble with the quirky curiosity of an Independent. During the war it explored the same goofy designs that Hudson and the others did but unlike them, after the war settled on measured, lasting designs for 1948 while others faltered to varying degrees. High compression OHV V8s, an always improving Hydramatic, pillar-less 4-door hardtops and (generally) good styling kept them in the lead. They earned their leadership position.
Nash did well during the Depression, financially and otherwise, besting GM with advanced body construction and matching them in styling with Walker’s ‘39s, though they would be way late with a 3-box sedan. They faltered with design beginning in ’49, which was Mason’s fault, just as Sloan’s executive vision had led to Art & Color. Mason was blind to good design, which held Nash back just when it had a chance to really get strong. Ditto Barit and Hudson, which beat GM in what became the race for lowness, and did impressive things with body engineering, paying off on the road, in accidents and on the track. But Barit’s blindness to design and misplaced bets eventually found them short of cash. Like the other Independents they had only themselves to congratulate for those things done well, and to blame for those done poorly.
Wasn’t it Packard in the late Twenties who was “the well-groomed rich kid” that looked down at Cadillac? Any diatribe against The General and sympathy towards the Independents should acknowledge the former’s hard climb to the top and the latter’s clumsy fall to the bottom. Not to dredge up the never finished Packard obit but EGB’s leadership mismanaged the company’s affairs from the intro of 110 to the day it closed shop. I have no sympathy nor do I blame the multitude of “outside factors.” Packard had a fair chance. That it took 20 years of fairly consistent bad product decisions is testament to how strong the company actually was at its height. It could have gotten back in the game under Nance and yes, the luxury market would have rewarded it. Nance made bad product decisions because he was not a car person and had no clue what to do in the early days as President. He ended up over spending on too many things, under spending on a few, and too slowly spending on just about everything.
How to identify and apply these lessons from history are the most important things on my mind, which is why I enjoy these rich discussions with you, Aaron. You make me think, even if in the end we end up thinking differently.
I’m just going to say I disagree on almost all points and leave it at that.
Richard Langworth’s “Collectible Automobile” article stated that the Jet appealed to the sort of buyer who might otherwise get an Austin A40, with the advantage that unlike the A40, the Jet could cruise at 75 mph all day without throwing up its guts. Aside from the issues with the Jet’s styling and pricing, that was definitely a niche market at that time.