As we saw in our first installment, Kaiser-Frazer’s initial success in the postwar automotive boom came to an abrupt end in 1949. The debacle that followed ended the partnership of Henry J. Kaiser and Joseph Frazer and left the company more than $43 million in the red. Nonetheless, Henry Kaiser and company president Edgar Kaiser decided to stay the course, betting that they could turn things around with a stylish new 1951 Kaiser and a new compact car called the Henry J. This week, we present the second half of our history of Kaiser-Frazer, including the 1951 Kaiser, the Henry J, and the ultimate fate of Kaiser’s automotive venture.

DUTCH DARRIN DROPS HIS PANTS

When Joseph W. Frazer and Henry J. Kaiser first became partners in 1945, they each had grand ambitions of building an advanced, economical compact car, possibly with front-wheel drive and other innovations. As we saw in last week’s installment, expediency led the founders to shelve those plans by early 1946; the first Frazer and Kaiser production models were orthodox full-size cars. Although they sold well in the postwar boom, everyone involved considered them interim models. Work began by the end of 1947 on the second-generation cars, which were slated for release in 1950 as 1951 models.

Both the Frazer and the initial Kaiser were based on a tossed-off design by acclaimed styling consultant Howard “Dutch” Darrin. Although early Frazers carried badges proclaiming his involvement, Darrin was never happy with the design, which he had never envisioned as a production model. Disgruntled, he turned his focus to other projects, although his contract gave him the right of first refusal on the design of future K-F models.

The Kaisers, particularly Henry Kaiser’s son Edgar, who had become the company’s general manager in 1946, were not particularly sad to see Darrin go. Joe Frazer had hired the mercurial, temperamental Darrin because the designer was well known and respected in automotive circles, but the Kaisers hadn’t liked the terms of Darrin’s original contract, which included per-car royalties for use of his designs. Darrin got along well with Henry and Edgar personally, but as Joe Frazer’s influence diminished, so too did the company’s apparent tolerance for Darrin.

In March 1948, Frazer — then still Kaiser-Frazer’s president — called Darrin at his studio in Hollywood and asked him to fly out to the Kaiser-Frazer offices as soon as possible. When Darrin arrived, he discovered to his dismay that the company already had clay models of two different proposals for the second-generation Kaiser: one developed by the in-house styling team, led by ex-Chrysler designer Bob Cadwallader, and the other created by consultant Jim Floria of Brooks Stevens Associates. Commissioning those proposals was technically a violation of Darrin’s contract with Kaiser-Frazer, but by that point, there was little to be done about it short of filing a lawsuit. If Darrin wanted a shot at styling the 1951 Kaiser, he would have to work fast.

At first, the in-house styling team seemed reasonably accommodating. Bob Cadwallader assigned Kaiser-Frazer stylist Duncan McRae to help Darrin refine his design concepts — which Darrin dubbed “Speed Styling” — into a full-size clay model. The initial pretense of cooperation faded quickly. Cadwallader forbade McRae from working overtime on Darrin’s model, although McRae defied him. As for Darrin himself, he later alleged that Kaiser-Frazer employees actually tried to bar him from the styling studios.

Nonetheless, by the end of April, Darrin and McRae’s model, dubbed “Constellation,” was ready for viewing. It incorporated a variety of novel features, the most unusual of which were sliding doors, a concept that Darrin patented and later applied to the short-lived Kaiser Darrin sports car. The Constellation model incorporated Darrin’s signature “Darrin dip” in the beltline and had distinctive “widow’s peaks” at the centers of the windshield and backlight. With its steeply raked windshield and sloping roof, the “Constellation” was sleek and almost racy compared to the stodgy, upright design proposal developed by the in-house team.

The “Darrin dip” was one of Dutch Darrin’s stylistic trademarks, seen here on a 1941 Packard Clipper Darrin.

All three proposals were shown to Henry and Edgar Kaiser at the end of the month. As Darrin told the story, on viewing day, Cadwallader ordered his stylists to line up in front of Darrin and McRae’s “Constellation” model, completely blocking it from the Kaisers’ view as they walked through the studio. Darrin, unwilling to be defeated by such an obvious trick, resorted to one of his own. As he later told the story, he undid his belt and walked toward the Kaisers, letting his pants drop as he did. Having succeeded in capturing the attention of his audience, he immediately launched into his sales pitch. Henry Kaiser, apparently unfazed by Darrin’s antics, walked around the “Constellation” and declared it the winner.

Designer Arnott “Buzz” Grisinger, who was present that day, later asserted that Darrin’s story wasn’t true, although Darrin’s design was chosen for production. In any case, Darrin’s relationship with Kaiser-Frazer remained uneasy. At the time, Darrin believed the main reason for these clashes was Edgar Kaiser’s reluctance to pay Darrin’s royalties, but Darrin later admitted with some chagrin that his own stubbornness and temper were at least partly to blame. He parted ways with Kaiser-Frazer again in late 1952, claiming that the in-house stylists had recycled some of his concepts without consulting or crediting him.

There’s an urban legend that the Kaiser’s distinctive “widow’s peak” windshield was the result of a draftsman’s error, which is apparently untrue. Darrin’s son Bob suggested this feature, which appears in his earliest sketches, although Darrin intended the windshield to be one piece.

THE 1951 KAISER

Although Darrin and McRae’s original concept was inevitably watered down somewhat for production, the 1951 Kaiser was quite an advanced design for its era. Standing 60.3 inches (1,532 mm) tall, it was one of the lowest sedans of its time and its low beltline and slender roof pillars gave it significantly more glass area than any competitor. Darrin’s design was a significant departure from the high beltlines and small windows that characterized many prewar and immediate postwar designs.

The new Kaiser included several now-common features that were rare in its day, including doors cut into the roof for easier entry and exit and a recessed bay beneath the trunk floor for the spare tire. Darrin’s sliding-door concept was dropped early on, however, which was probably just as well. For cost reasons, the production car also got a conventional split windshield rather than the intended one-piece wraparound design. Still, the new Kaiser was a far more stylistically sophisticated car than its undistinguished predecessor.

The 1951 Kaiser Deluxe was 210.4 inches (5,344 mm) long; Specials, without bumper overriders, were 1.9 inches (48 mm) shorter. The Deluxe was 3.9 inches (98 mm) longer than its 1950 predecessor, but its wheelbase was reduced from 123.5 to 118 inches (3,1937 to 2,997 mm). The ’51 Kaiser was also significantly lighter than its predecessor, weighing 3,300 to 3,400 lb (1,500 to 1,542 kg) at the curb, typically equipped. It was one of the lightest cars in its class.

The interior was less radical, but it did feature a variety of attractive color and fabric combinations selected by Kaiser-Frazer color chief Carleton Spencer. Many were inspired by features in House & Garden magazine, a popular tastemaker of the time, so Kaiser interiors were very au courant. Probably Spencer’s greatest contribution to the second-generation Kaisers was an unusual alligator-pattern synthetic material called “Dragon Vinyl.” The first Dragon-upholstered model was the 1951 Kaiser Golden Dragon, a $125 trim option announced in November 1950.

Although it broke no really new technical ground, the 1951 Kaiser’s engineering was also quite advanced for the early fifties. Engineers Ralph Isbrandt and John Widman considered unit construction, but judged it too expensive for its benefits and opted instead to concentrate on improving the strength and reducing the weight of the existing body-on-frame structure. Thanks to their efforts, the curb weight of the production models was only around 3,300 lb (1,500 kg), a good deal lighter than most similarly sized contemporaries.

Despite the light weight, the Kaiser was also among the most structurally rigid cars in its class. Moreover, the new Kaiser had a very low center of gravity and an uncommonly good ride. It was hardly a sports car even by contemporary standards, but it wasn’t far behind the “Step Down” Hudsons, generally considered the best-handling American sedans of this era.

Although the previously optional dual-carburetor set-up was now standard, the 1951 Kaiser’s Continental-designed 226 cu. in. (3,707 cc) flathead six still made only 115 hp (86 kW). A modern V8, which Kaiser didn’t have and couldn’t afford, would have made this car quite a rocket.

What the Kaiser lacked was power. Kaiser-Frazer engineers had been working on a modern OHV V8 engine since 1945, but the company didn’t have the money to build it. Kaiser-Frazer approached Oldsmobile about purchasing the 304 cu. in. (4,977 cc) Rocket V8, but the negotiations collapsed after Oldsmobile abruptly raised its asking price. Some Kaiser-Frazer executives believed the about-face was sparked by Oldsmobile’s realization that the lightweight new Kaiser would outrun a similarly powered Olds 88.

As a result, Kaiser had to fall back on the same hoary Continental-designed flathead six used in the earlier Kaisers and Frazers. Still displacing 226 cu. in. (3,707 cc), it made a meager 115 gross horsepower (86 kW). The new Kaiser did at least offer an automatic transmission; after four years of negotiations, Edgar Kaiser had finally persuaded General Motors to let Kaiser-Frazer purchase GM’s four-speed Hydra-Matic, which became a popular $159 option.

Price had been a sticking point for the earlier Kaisers and the 1951 models still weren’t cheap. The least-expensive Special business coupe started at almost $2,000, only $57 cheaper than a V8-powered Oldsmobile 88. A Kaiser Deluxe two-door sedan like our white photo subject started at $2,275, $37 more than an eight-cylinder Buick Super DeLuxe. Lacking a V8 or even a straight-eight engine, the new Kaiser would have to get by on its looks.

The rear window of the 1951 Kaiser repeats the windshield’s widow’s peak dip. Note the abundant brightwork; in 1953, Kaiser briefly offered a stripped-down Kaiser Carolina with a lower base price, but it sold poorly, accounting for only 1,812 units.

THE LITTLEST KAISER: THE HENRY J

Also debuting for the 1951 model year was Kaiser’s first compact, the Henry J, whose development is covered in more detail in our article on the Kaiser Darrin. Intended to fulfill Henry Kaiser’s original dream of a low-cost economy car — and the terms of his most recent Reconstruction Finance Corporation (RFC) loan agreement — the Henry J was based on a design by American Metal Products, refined by Dutch Darrin and Kaiser-Frazer’s in-house stylists. It was very similar in size to Nash’s new Rambler — 174.5 inches (4,432 mm) long on a 100-inch (2,540mm) wheelbase — and offered a choice of either a 134 cu. in. (2,200 cc) four or a 161 cu. in. (2,639 cc) six, both flathead engines purchased from Willys-Overland.

The early Henry J was 174.5 inches (4,432 mm) long on a 100-inch (2,540mm) wheelbase; 1953-54 models, like this one, got a mild restyling of the tail and rear bumper that made them somewhat longer than before, 181.6 inches (4,613 mm) for the base car (now called Henry J Corsair) and 184.6 inches (4,689 mm) for the Corsair Deluxe. All were still very spartan even for cheap American cars of this era. From 1952 to 1953, Sears, Roebuck sold a mildly restyled version of the Henry J as the Allstate. They sold in only a few select markets and disappeared in 1953 after only 2,363 sales. (Photo © 2007 Anne Mitchell Lape; used with permission)

Unlike the well-trimmed Rambler, which Nash pitched as a sensible second car for affluent buyers, the Henry J defined the term “poverty spec.” To meet the price target, early cars lacked even an opening trunk lid and the dashboard had a vinyl storage pouch in lieu of a glove compartment. For all that, the Henry J was not impressively cheap. A Deluxe six-cylinder model had a base price of $1,429, only about $50 less than a basic Chevrolet. The Henry J got much better fuel economy than the Chevrolet — 25 mpg (9.4 L/100 km) was typical — but it was hardly a bargain. Furthermore, early cars had shaky build quality, with a tendency to window leaks, interior drafts, and persistent interior rattles. Still, the Henry J was cute, it was cheap to run, and it was one of the least-expensive cars on the market.

KAISER’S LAST SPRING

Although the outbreak of hostilities in Korea curtailed buyer enthusiasm, Kaiser-Frazer sales for 1951 reached 231,608, beating 1948’s peak by 65%. Most of those sales were the new Kaiser, plus 81,942 Henry Js and 10,214 Frazers. (The latter were actually facelifted leftover 1950 models, the last gasp of the Frazer marque.)

The 1951 Kaiser’s fancy-looking (if somewhat illegible) instrument panel clusters all the secondary gauges around the speedometer. The previous generation’s dash had the gauges laid out horizontally on either side of the speedo. This is somewhat less elaborate than the snazzy two-tier dash originally planned for this car, which was canceled for cost reasons. Note the chrome trim on the dash; this is a Deluxe model, which has more interior brightwork than the basic Special. The speedometer’s 120-mph (193-km/h) upper limit, incidentally, is greatly optimistic. Actual top speed was perhaps 85 mph (136 km/h).

In addition to reinvigorated auto sales, Kaiser-Frazer also had new defense contracts, beginning with an $82 million agreement to build the Fairchild C-119 Flying Boxcar for the United States Air Force. The company subsequently signed a separate agreement to build the Lockheed P2V Neptune for the Navy. The contracts were far from lucrative considering the tooling expenses and retraining expenses involved, but Kaiser-Frazer needed the revenue and the contract enabled the company to utilize more of its considerable factory capacity. In fact, Edgar Kaiser had to reassure stakeholders that the aircraft contracts would not lead Kaiser-Frazer to abandon the automobile business.

Alarmingly, despite all the good news, Kaiser-Frazer still lost money for 1951: $12.3 million, almost as much as in 1950. Some of the loss reflected the money Kaiser-Frazer had spent to buy the Continental Motor Company’s Detroit Manufacturing Division, which made Kaiser’s engines. Nevertheless, the numbers were discouraging.

A central problem was that Kaiser-Frazer was still building more cars than it could sell. When sales slumped later in the year, the company ended up with 8,000 leftover ’51 cars. Kaiser-Frazer’s remaining Detroit veterans were also very critical of the company’s spending, chiding extravagances like allowing executives to order costly custom-trimmed cars for personal use. The fact that the Kaisers and many of their senior staff were still based in California also resulted in enormous travel costs.

The 1951 Kaiser’s suspension layout was very conventional — double wishbones in front, semi-elliptical leaf springs in back — but well-considered spring rates and lots of wheel travel gave it an exceptionally good ride. The tiny badge just below and inboard of the right taillight, barely visible here, says “Darrin styled.” Early 1947 Frazers bore a similar badge until Howard Darrin protested.

Perhaps the biggest and more difficult problem was the one that had led to the final split between Henry Kaiser and Joseph Frazer back in 1949: the company’s heavy reliance on credit to make up for its lack of capital. By 1951, Kaiser-Frazer’s already high overhead was further inflated by interest and finance charges on a debt load that now exceeded the aggregate market value of the company’s stock.

In 1951, the big Kaisers were offered in basic Special and plusher Deluxe trim. In 1952, the Special was renamed Deluxe and the previous Deluxe became the Kaiser Manhattan. A mild facelift stretched the the ’52s to 211.1 inches (5,363 mm) overall; the ’53s, like this one, got another minor touch-up, but their dimensions were unchanged. (Photo: “1953 Kaiser Manhattan” © 2008 Jim Lape; used with permission)

THE VALLEY OF THE SHADOW

The Korean War was a bitter time for the independent automakers. Although industry pressure discouraged the government from halting civilian production as it had done during World War II, Washington did impose caps on automobile production based on each automaker’s 1950 levels. Raw materials, which had been an issue for all automakers since 1945, again became scarce and anti-inflationary consumer credit restrictions were tightened. The uncertainty surrounding the grim police action also dampened the public’s interest in new car purchases.

The 1953 Kaisers were a little longer than the 1951s, now 211.3 inches (5,367 mm) overall, although the body was fundamentally the same. This is a 1953 Golden Dragon, a special trim package originally introduced early in the 1951 model year. It was revived in 1953 as a limited edition, sporting a unique interior of Laguna cloth and “Bambu” vinyl, styled by Carleton Spencer and fashion consultant Marie Nichols. (Photo: “Kaiser Golden Dragon 1953” © 2009 TedXopl2009; used with permission)

Kaiser’s first inauspicious 1952 offerings were 6,561 leftover 1951s re-serialized as 1952 Kaiser Virginians. Concurrently, 7,017 unsold 1951 Henry Js were fitted with optional Continental spare tires and sold as Vagabonds. The real 1952 Kaisers, mildly facelifted and sporting many minor improvements, did not appear until February 1952.

The true 1952 Kaisers had new names: Henry Js were now called “Henry J Corsair”; the previous Kaiser Special was renamed Deluxe; and the ’51 Deluxe was replaced by the 1952 Manhattan, a name Kaiser-Frazer had previously used for the top-of-the-line Frazers. Prices were also new and substantially higher than before, in some cases by more than $500.

The higher prices and rapidly shrinking demand for the Henry J slashed total 1952 sales to a dismal 57,265, including Virginians and Vagabonds. The military work held losses to “only” $4.7 million, but Kaiser-Frazer employees were already wondering if the company’s days were numbered.

One of the few bright spots during this period was the Kaiser-Frazer Export Corporation, started in early 1948 by Joseph Frazer’s nephew, Hickman Price, Jr., K-F’s former treasurer. The strength of the dollar had allowed the export subsidiary to establish assembly plants in Bombay, Haifa, Mexico City, and Rotterdam and made the export business consistently profitable despite Kaiser-Frazer’s reluctance to provide export-specific modifications and equipment. However, Price had grown frustrated and jumped ship in September 1952 to become president of Willys do Brazil, Willys-Overland’s Brazilian subsidiary.

THE WILLYS DEAL AND THE SALE OF WILLOW RUN

After merger discussions with the Atlas Corporation and the aircraft company Consolidated Vultee (a.k.a. Convair) came to nothing, Edgar Kaiser announced in March 1953 that Kaiser-Frazer would purchase another independent automaker: Toledo, Ohio-based Willys-Overland, the company of which Joe Frazer had once been president.

Buying Willys was a curious move considering Kaiser-Frazer’s precarious financial position and the fact that Kaiser-Frazer didn’t have anything close to the $62.4 million Willys-Overland chairman Ward Canaday was asking for his company. Executing the purchase involved some convoluted financial maneuvering: Through the Henry J. Kaiser Company, the Kaisers, the Transamerica Corporation, and Bank of America financed a new Kaiser subsidiary with the funds necessary to purchase Willys. After the purchase was completed, the subsidiary was renamed the Willys Motor Corporation while Kaiser-Frazer officially became Kaiser Motors, sweeping away the last vestiges of the original partnership with Joe Frazer.

Kaiser’s Golden Dragon package included 14-carat gold trim, special interior trim and carpet, and a lot of extra sound insulation, making it the quietest and most luxurious Kaiser. The package included Hydra-Matic, a heater, a radio, and other accessories and added a hefty $1,270 to the already-lofty price of a Kaiser Manhattan. The package was quite rare, accounting for only 1,227 sales. The Dragons were offered in three series, each available in different color combinations; this one, painted “Maroon Velvet” with a beige top, is part of the third and final series, announced in March 1953. (Photo: “Kaiser Golden Dragon 1953” © 2009 TedXopl2009; used with permission)

Willys-Overland was not an obvious merger choice. Willys’ own recent automotive venture, the compact Aero-Willys, had fared no better than Kaiser’s. However, Willys had remained profitable thanks mainly to Jeep. Although Jeep was not yet the commercial bonanza it would later become, it had solid military sales and enjoyed a modest but stable consumer niche.

More importantly, the Willys factory in Toledo was far more appropriate for Kaiser’s production needs than Kaiser-Frazer’s massive Willow Run plant outside Detroit, a former bomber factory that K-F had leased in September 1945 and later purchased. Impressive as it was, Willow Run had far more capacity than Kaiser-Frazer had ever really needed and it was rapidly becoming unaffordable, particularly in the face of new United Auto Workers (UAW) demands for wage parity with Ford’s equally colossal (but much more fully utilized) River Rouge plant.

The Willow Run problem was becoming more acute as Kaiser-Frazer’s defense business crumbled. Trying to balance aircraft and automobile production in the same plant with substantially the same workforce had been cumbersome and expensive, exacerbated by a flood of USAF-requested design changes to the C-119 Flying Boxcar Kaiser was building. The resulting cost overruns became the target of several voluble Congressional Republicans and led to a 1952 Air Force inspection. In June 1953, Congressional hearings on the matter painted the company in a negative light. With the Korean War nearly over anyway, the Air Force finally canceled Kaiser-Frazer’s C-119 contract.

Soon afterward, Kaiser Motors laid off all of the 2,600 workers at Willow Run and began the move to Toledo, which was completed by September. Edgar Kaiser initially described the move as temporary, but with the loss of the Air Force contracts, there was really no way Kaiser could afford to restart production at Willow Run. Later that year, Kaiser Motors sold the plant to General Motors, which quickly retooled it to replace the Hydra-Matic plant in Livonia, Michigan, that had burned down in August. Kaiser used the $26 million purchase price to pay off part of the company’s outstanding Reconstruction Finance Corporation loans.

KAISER’S LAST STAND

Considering all this chaos, it’s little surprise that Kaiser’s 1953 sales were even worse than 1952’s. The lack of a V8 engine had also become an insuperable problem. If the Kaiser had been a low-priced car, the situation might not have been as bad — Chevrolet, Plymouth, and Pontiac didn’t get V8s until 1955 — but the Kaiser Manhattan was priced within a few dollars of Buick’s popular long-wheelbase Super Riviera sedan and and cost almost $200 more than an Oldsmobile Super 88, both of which enjoyed greater prestige and V8 power.

To make matters worse, most mid-price rivals now offered fashionable hardtops while Kaiser had only two- and four-door pillared sedans. (Kaiser-Frazer stylists had designed both hardtops and convertibles, but they didn’t make it to production.) Kaiser again ended the year with many unsold cars and recorded a net loss of $27.1 million.

Howard Darrin developed the Kaiser Darrin on spec in early 1952, using a fiberglass body and the chassis and running gear of the Henry J. Henry Kaiser was initially aghast that Darrin would create a sports car proposal without authorization, but Kaiser’s wife, Alyce Chester Kaiser, loved the look and persuaded him to approve it for production. (Photo: “DKF-161 Kaiser Darrin” © 2009 John Lloyd; used under a Creative Commons Attribution 2.0 Generic license)

As before, Kaiser was obliged to repackage and re-serial some leftover 1953 cars and offer them alongside Kaiser’s actual 1954 models. The true 1954 Kaisers had updated styling and were considerably glitzier than before, featuring acres of chrome, a Buick-like concave grille, a fake hood scoop, and rather extravagant “Safety-Glo” taillights. There was still no V8 engine, but a McCulloch centrifugal supercharger was now optional, boosting power to 140 hp (104 kW). The supercharger gave the Kaiser more reasonable performance — 0-60 mph (0-97 km/h) in around 15 seconds — but it was still not a V8 and the supercharger could be troublesome. (Incidentally, this was an earlier version of the same McCulloch/Paxton supercharger later used on the Studebaker Super Lark.)

Kaiser’s 1954 facelift, penned by in-house designers Buzz Grisinger and Herb Weissinger, was reportedly inspired by a Buick show car called the XP-300, a favorite of Edgar Kaiser’s and also the inspiration for the styling of the 1954 Buick Skylark. This example is one of a handful of Kaisers in Sweden, where they have a certain following. (Photo: “1954 Kaiser Manhattan” © 2008 Stefan Jansson; used with permission)

Hoping to spur customer traffic, Kaiser launched its first sports car, a fiberglass-bodied convertible called the Kaiser Darrin. Developed by Dutch Darrin in 1952 as a spec project, the Kaiser-Darrin used a Henry J chassis and engine, but had a unique interior and Darrin’s patented sliding doors. It was an interesting piece, but it was neither particularly fast nor especially practical. With a list price of $3,668, the Kaiser Darrin was also very expensive and Kaiser dealers were reluctant to order them. Production ceased after only 435 had been built and Dutch Darrin later found about 100 unsold cars languishing outside the Willys plant.

New sales chief Roy Abernethy (later to become chairman of AMC) tried hard to revive Kaiser sales, but without success. High prices, ferocious depreciation, and the company’s uncertain future made a new Kaiser a dubious value. Total 1954 sales were only 7,039 and the company ended the year with a $14.5 million loss.

INDUSTRIAS KAISER ARGENTINA

The last hope for Kaiser’s automotive business came not from the U.S., but from South America. Argentine president Juan Perón had actually approached Kaiser-Frazer back in 1947 about the possibility of manufacturing cars in Argentina, but nothing had come of it. However, in mid-1954, Henry Kaiser’s friend De Lesseps Morrison, the mayor of New Orleans, convinced Kaiser that South America offered rich opportunities for local automotive production.

Kaiser subsequently visited nine South American countries, including Argentina, where Henry and his wife met with Perón. Kaiser initially viewed the right-wing Perón regime with suspicion — which some accounts allege was exacerbated by heavy-handed demands from Argentine officials — but Perón assured him that the business would be completely above board. He and Kaiser signed a letter of understanding on October 5.

On January 20, 1955, Kaiser formed Industrias Kaiser Argentina S.A. (IKA), a joint venture with the government-run Industrias Aeronáuticas y Mecánicas del Estado. IKA’s first managing director was Jim McCloud, Edgar Kaiser’s brother-in-law. Surprisingly, Kaiser took only a small minority interest in IKA, the majority of whose shares were offered on the Argentine stock market. IKA broke ground in April for its new factory, located in Santa Isabel in the province of Córdoba.

The fact that both Kaiser and the Argentine government held only minority interests in IKA proved fortuitous, allowing IKA to survive the fall of the Perón regime that September. By June 1956, the Córdoba plant was online, initially assembling Jeeps and 1954-1955 Kaiser sedans shipped in complete knocked down (CKD) form from Toledo. Kaiser Motors transferred some of the tooling for the big Kaisers to IKA as U.S. production wound down.

THE END OF THE ROAD — ALMOST

In the United States, Kaiser automobile production was nearly finished. The company built only 1,291 1955 Kaisers and most of those were CKD kits for Argentina. The Aero-Willys compacts were also nearing the end of the road, accounting for only 6,564 sales in 1955.

Until almost the end, Kaiser still hoped to introduce new models, including the much-discussed FWD subcompact and a third-generation Kaiser that would have shared components with a new compact car, an idea Dutch Darrin had recommended several years earlier. The Kaisers, however, finally decided that enough was enough. At a board meeting in the spring of 1955, Edgar Kaiser announced that U.S. production of all Kaiser and Willys automobiles would cease that fall. Jeep production continued, however, allowing Willys to post a $4.7 million profit for its 1955 fiscal year.

Months later, in March 1956, the Kaisers consolidated all of their various companies — including Kaiser Motors and Kaiser’s cement, aluminum, and steel interests — into a new publicly traded holding company called Kaiser Industries Corporation, with a combined share value of $417 million. Kaiser-Frazer’s accumulated loans were repaid and the automaker’s remaining shareholders were allowed to convert their stock to Kaiser Industries shares at a rate of four to one. If it was not everything investors might have hoped, it was nonetheless a worthwhile (and lucrative) consolation prize for those who had believed in Henry Kaiser’s automotive dream.

That dream was not wholly dead; Willys continued to build and sell Jeeps for the U.S. market and both Willys and Kaiser retained their subsidiaries in South America. In 1958, IKA introduced the Carabela, a locally manufactured version of the 1954-1955 Kaiser Manhattan. Although the Carabela was too expensive to sell in large numbers, IKA supplemented it with Jeeps and other models, including license-built Renaults and, starting in 1960, the Alfa Romeo-based Bergantín. The Carabela ceased production in 1962, replaced by local versions of AMC’s Rambler Classic and later an unusual and rather pretty Rambler American offshoot called the IKA Torino.

Both IKA and Willys-Overland do Brasil, Willys’ Brazilian subsidiary, became profitable by the early sixties, but Kaiser Industries sold its stake in both companies in late 1967. Industrias Kaiser Argentina was purchased by Renault and the following year was renamed IKA-Renault. The IKA name was finally dropped in 1975 and the company became simply Renault Argentina S.A.

Between 1958 and 1961, IKA built 8,025 Carabelas, the locally manufactured version of the 1954-55 Kaiser Manhattan. They were quite expensive by Argentine standards — albeit less than many imported cars — and accounted for a relatively small percentage of the factory’s production. Mechanically, the IKA Carabela was very similar to the final Kaiser Manhattan, but had no supercharger or Hydra-Matic. IKA experimented with several derivatives of the Carabela, including a two-door convertible, and considered several redesign proposals (including some by Dutch Darrin), but none were produced. (Photo: “Kaiser Carabela” © 2007 Sebastian Palopoli; used with permission)

In 1963, Willys Motor Corporation became Kaiser Jeep, offering groundbreaking vehicles like the original Jeep Wagoneer sport-utility vehicle. In the sixties, however, these were still niche products and by the end of the decade, Kaiser Jeep was again struggling financially. Edgar Kaiser arranged to sell Kaiser Jeep to AMC in early 1970 for a reported $70 million, including a 22% stake in American Motors. Kaiser Industries sold those shares later in the decade, the Kaisers’ last involvement in the auto industry.

Henry Kaiser officially retired in the mid-fifties, relocating to Hawaii with his second wife, Alyce Chester Kaiser. He subsequently became involved in resort and hotel development, remaining very active until his death in 1967 at the age of 84. Edgar Kaiser remained the chairman of Kaiser Industries until it was broken up in 1977, four years before Edgar’s own death. The Kaisers’ former partner, Joe Frazer, had died in 1971.

Although their automotive venture didn’t quite pan out, the Kaisers’ legacy in other industries remains impressive. Perhaps the Kaisers’ most enduring accomplishments were the establishment of the Kaiser Permanente health network, which began in the 1930s as a private health plan for Kaiser employees, and the Kaiser Family Foundation, one of the U.S.’s largest philanthropic organizations.

REQUIEM FOR THE KAISER-FRAZER DREAM

Barring quixotic efforts like Tucker, the Kaiser-Frazer Corporation was the last serious effort to launch a new mass-market automaker in the United States. (American Motors, incorporated in 1954, was really the consolidation of two preexisting companies, Nash and Hudson.) The direct reasons for Kaiser-Frazer’s failure are not complex: a lack of capital and excessive costs relative to the Big Three. The more interesting question is why Henry Kaiser failed. Kaiser had a formidable record of success in other industries before, during, and after his unsuccessful automotive enterprise. Why did the man who had built the Hoover Dam falter in taking on Detroit?

First, Kaiser’s tremendous achievements in construction and manufacturing were in contract-based businesses, not retail sales operations. Henry Kaiser was always an ebullient salesman, but his retail experience had ended before World War I. With government contract jobs, the competition is mostly in securing the contract; after that, the customer and the price are more or less assured (although even that isn’t 100% guaranteed, as Kaiser found with its defense contracts). The auto industry is a different and more brutal game, where building a good product and convincing people to buy it are two entirely different problems. The immediate success of 1947 and 1948 lulled Kaiser into a false sense of security, suggesting that the strategies that had worked so well in the shipbuilding trade would also work in the car business, but that was only true in the brief rush of the postwar seller’s market.

Second, the Kaisers’ approach to Kaiser-Frazer was not unlike the many online start-up companies of the late 1990s: They threw many ideas at the wall in search of one that would stick, assuming that once the company found its niche, they could easily repay the deficit they had run up along the way. What Henry Kaiser had to learn the hard way was that the auto industry is in many ways a war of attrition. The cost of a new product is only the beginning; you also have to budget for its replacement and the next generation after that.

Many automotive historians think Kaiser’s greatest downfall was in not listening to Joe Frazer, who understood these things all too well. We’re not so sure. True, if Henry Kaiser had heeded Frazer’s advice, Kaiser-Frazer might have mitigated the disaster of the 1949 model year and brought about a useful degree of financial restraint. Even so, we doubt that Kaiser-Frazer’s eventual fate would have been much different.

To our mind, Kaiser-Frazer’s greatest failure was in not defining a distinct identity for the company’s brands in a crowded and ferociously competitive postwar market. Kaiser could have had a coherent image — albeit not necessarily a lucrative one — if Henry had pursued his original agenda of building an inexpensive, plastic-bodied economy car, but Joe Frazer talked him out of it. Despite Frazer’s early talk about building an economy car, it appears that what he really wanted was to make K-F an orthodox, bread-and-butter automaker like Chrysler, offering pretty good cars for a pretty good price. That was a fine ambition, but the era in which it was a realistic goal for a company as small as Kaiser-Frazer ended with the Great Depression.

The Kaisers didn’t find their niche until after the merger with Willys-Overland, when they acquired the Jeep brand. Of course, Jeep wasn’t Kaiser-Frazer’s creation (except insofar as Joe Frazer was responsible for establishing the brand during his earlier tenure at Willys), but it had the unique products and unique identity that K-F had needed from the beginning. Admittedly, it was not until years later that Jeep, which is now owned by Chrysler [Author’s note: now FCA US LLC], became the lucrative brand it is today. Nonetheless, the mere fact that it still exists — long after Kaiser and Frazer became historical footnotes — speaks volumes.

This is not to say that the Kaiser or Frazer automobiles were bad products; other than their lack of power, they were fine cars in many respects. The second-generation Kaiser was even better and would have been genuinely impressive with either an Oldsmobile V8 or the planned 287 cu. in. (4,706 cc) Kaiser V8 under the hood. It’s a pity that, like too many bright children born to families of limited means (and Kaiser-Frazer was that, despite the founders’ individual wealth), it never really had a chance to thrive.

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NOTES ON SOURCES

Our sources for this article included Stephen B. Adams, Mr. Kaiser Goes to Washington: The Rise of a Government Entrepreneur (Chapel Hill, NC: University of North Carolina Press, 1997); the Auto Editors of Consumer Guide, Cars That Never Were: The Prototypes (Skokie, IL: Publications International, 1981), and Encyclopedia of American Cars: Over 65 Years of Automotive History (Lincolnwood, IL: Publications International, 1996); Douglas Brinkley, Wheels for the World: Henry Ford, His Company, and a Century of Progress (New York: Viking Penguin, 2003); Arch Brown, “1953 Allstate: Henry J in Drag?” Special Interest Autos #155 (September-October 1996), reprinted in The Hemmings Book of Postwar American Independents: driveReports from Special Interest Autos magazine, ed. Richard A. Lentinello (Bennington, VT: Hemmings Motor News, 2002), pp. 4-11; “Controls: Strength through Pain,” TIME 18 December 1950 (www.time. com, accessed 3 June 2010); Howard “Dutch” Darrin, “My American Safari: Further Adventures in the Automotive Jungle,” Automobile Quarterly Vol. 10, No. 1 (First Quarter 1972), pp. 36-45; Mark S. Foster, Henry J. Kaiser: Builder in the Modern American West (Austin, TX: University of Texas Press, 1989); Patrick R. Foster, The Story of Jeep (Iola, WI: Krause Publications, 1998); Roberto Dario Frassinetti, “Rare car Bergantin made by Kaiser Frazer of Argentina (14 February 2006, Route 40 for the Adventure Traveller by Bob Frassinetti, route40argentina.tripod. com, accessed 16 December 2009); Nick Georgano and Nicky Wright, Art of the American Automobile: The Greatest Stylists and Their Work (New York: SMITHMARK Publishers, 1995); Ken Gross, “Pride of Willow Run: 1951 Frazer Manhattan Convertible” and “Then Man Who Never Failed,” Special Interest Autos #27 (March-April 1975), reprinted in The Hemmings Book of Postwar American Independents: driveReports from Special Interest Autos magazine, pp. 28-35; John Gunnell, ed., Standard Catalog of American Cars 1946-1975, Rev. 4th ed. (Iola, WI: Krause Publications, 2002); David Halberstam, The Fifties (New York: Ballantine Books, 1993), and The Reckoning (New York: William Morrow and Company, 1986); Ronald Hansen, Emilio R. del Valle, and Enrique T. Meincke, “IKA Torino 380 W,” Parabrisas No. 80 (August 1967), Test del Ayer, www.testdelayer. com.ar/ torino380.htm, n.d., last accessed 9 April 2015; “Henry J vs. Maverick: How much progress in 23 years?” Special Interest Autos #23 (July-August 1974), reprinted in The Hemmings Book of Postwar American Independents, pp. 36-41; “High Finance: From Riches to Riches,” TIME 30 April 1945, (www.time. com, accessed 17 December 2009); Dave Holls and Michael Lamm, A Century of Automotive Style: 100 Years of American Car Design (Stockton, CA: Lamm-Morada Publishing Co. Inc., 1997); Michael Lamm, “The Imagineer William B. Stout: Automobile and Airplane, His Goal Was to See Them Wedded,” Car Life Vol. 14, No. 7 (August 1967): 54–58; L’Editrice Dell’Automobile LEA, World Cars 1973 (Bronxville, NY: Herald Books, 1973) and World Cars 1979 (Pelham, New York: Herald Books, 1979); David L. Lewis, “Ford’s Postwar Light Car,” Special Interest Autos #13 (October-November 1972), pp. 22–27, 57; Tom McCahill, “MI Test the 1951 Kaiser Special,” Mechanix Illustrated May 1950, pp. 84–85, 160, 174; Jack Mueller, ed., KFOCI Handbook, v. 4.0 (Kaiser-Frazer Owners Club International: n.d.), circlekf. com, last accessed 27 June 2011; Richard Langworth, “1953 Kaiser Manhattan: SIA Drives a NOS Kaiser,” Special Interest Autos #94 (July-August 1986), all of which are reprinted in Richard A. Lentinello, ed., The Hemmings Book of Postwar American Independents: driveReports from Special Interest Autos magazine (Bennington, VT: Hemmings Motor News, 2002), pp. 46-61; and Kaiser-Frazer, the Last Onslaught on Detroit: An Intimate Behind the Scenes Study of the Postwar American Car Industry (Automobile Quarterly Library Series) (Boston, MA: E.P. Dutton, 1975); Michael Parris, Fords of the Fifties (Tucson, AZ: California Bill’s Automotive Handbooks, 2000); “State of Business: Step This Way, Please!” TIME 19 May 1952 (www.time.com, accessed 3 June 2010); Daniel Strohl, “Companies that used Continental engines – the complete list,” (10 December 2008, Hemmings Blog, blog.hemmings. com, accessed 17 December 2009), and “Rambling Men,” Hemmings Classic Car #57 (June 2009); Mark Theobald, “Howard A. ‘Dutch’ Darrin 1897-1982” (2004, Coachbuilt, www.coachbuilt. com, accessed 25 June 2011); and Henry Kaiser’s obituary, “The Man Who Always Hurried,” TIME 1 September 1967 (www.time. com, retrieved 17 December 2009).

Additional background information on Henry and Alyce Kaiser came from Joan Didion’s 1966 essay “Letter from Paradise, 21° 19′ N., 157° 52′ W,” originally published in Didion’s anthology Slouching Toward Bethlehem (New York: Farrar, Straus and Giroux, 1968) and reprinted in We Tell Ourselves Stories in Order to Live: The Collected Nonfiction (New York, Alfred A. Knopf, 2006), pp. 142-153; “Henry Kaiser Tells Plan to Wed Nurse,” The Deseret News 7 April 1951, p. 2; “Kaiser Takes Bride Today,” Miami Sun News 10 April 1951, p. 15; School of Travel Industry Management, 2007 Legacy Honorees, “Henry J. Kaiser,” (28 November 2007, www.tim.hawaii. edu, accessed 25 June 2011; “TYCOONS: Henry J.’s Pink Hawaii,” TIME 24 October 1960, www.time. com, accessed 25 June 2011; and the Wikipedia® entry for Kaiser Permanente (en.wikipedia.org/wiki/Kaiser_Permanente, accessed 26 June 2011).

Some additional information on the Willow Run plant also came from “Production Miracle at Willow Run,” Strategos International, www.strategosinc. com/ willow_run.htm, accessed 18 December 2009, and Joe Baugher, “The Liberator Production Pool,” American Military Aircraft, 8 August 1999, home.att. net/ ~jbaugher2/b24_8.html, accessed 18 December 2009.

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