Ronnie wrote this nearly a month ago, but I was lazy and didn’t get it posted. With the recent Gibson bankruptcy speculation in the news, this piece now looks reactive rather than predictive — that’s on me, not Ronnie — JB
Did you know that Studebaker still existed as of just a few years ago? Yes, they stopped building cars in 1966 but in 2009, the Indiana Supreme Court ruled that Cooper Industries was the legitimate corporate heir of the Studebaker Corporation and thus responsible for the environmental cleanup of Studebaker factory sites in South Bend. Cooper Industries makes electrical components like circuit breakers and has since been acquired by Eaton. That’s just the latest in a series of deals that started when the Studebaker corporation, no longer making cars, merged with Wagner Electric and the Worthington Corp. to form Studebaker-Worthington in 1967. McGraw-Edison bought Studebaker-Worthington in 1979 (except for Studebaker-Worthington Leasing, which still apparently exists, providing financing for industrial equipment) and Cooper Industries bought McGraw-Edison in 1985.
Starting in the early 1950s, Studebaker’s position as an automaker became increasingly precarious. Though they had one of the earliest genuine postwar car designs in 1947, they really didn’t have the financial resources to go toe to toe with the big three Detroit automakers, particularly as GM, Ford, and Chrysler introduced modern, high compression V8 engines. What should have happened was a merger of the major independents, as was proposed by George Mason, who ran Nash (and merged it with Hudson to form American Motors), and wanted to merge with Packard, Studebaker and Kaiser Frazer, which had bought Willys. James Nance, who ran Packard, wasn’t willing to give up any power so a fourth major U.S. automaker never came to be. Eventually, though, Packard’s worsening financials forced them to merge with Studebaker, not realizing that Studebaker’s automotive operations were probably in even worse shape.