In the late 1930s, Detroit’s Big Three automakers unveiled their most up-to-date business plans that called for modernizing their factories while offering a wide spectrum of stylish new vehicles in a host of price ranges. America’s entry into the Second World War put those plans on hold. From December 1941 through July 1945, the domestic automobile industry and Washington officials worked diligently to provide the many boats, bombs, fighter planes, helmets, tanks, torpedoes and vehicles needed to win the war effort. As part of their well-coordinated efforts, all domestic car production in the U.S. halted in February 1942. With no new autos to sell, domestic dealers spent the bulk of the war years servicing older cars and adhering to federally imposed rationing guidelines and programs.

The 12 Greater Cleveland Buick dealers repeatedly reminded their many loyal customers of the importance of properly maintaining their cars throughout the war years. They claimed it was your patriotic duty to do so. In line with that thinking, they suggested regular vehicle check-ups and scheduled maintenance by qualified Buick mechanics using only factory-made products.^[1] Some non-affiliated, independent Cleveland dealers, such as the Factory Motor Exchange, at 3756 Carnegie Avenue, assisted in the war effort by rebuilding Ford V-8 Motors for only $49.50. ^[2] Local Packard dealers boasted that their carmaker was supplying the armed forces with powerful engines used in both PT boats and large airplanes. ^[3] Studebaker Motors contribution to the Second World War included, among other things, Wright Cyclone Engines destined for Flying Fortresses. ^[4] Federally imposed war bans drastically restricted the manufacturing and distribution of domestically made auto parts and tires. Local dealers responded to those bans by doing their utmost to conserve precious metal and rubber, whenever possible, and by selling off their inventories.

Local outlets also considered it extremely important to advertise regularly throughout the war years. They firmly believed that repeat advertising, mostly through local media outlets, would keep the name of their franchise fresh in the public’s mind. With victory in sight, the federal government announced the resumption of domestic automobile production in July 1945. Handling the large numbers of orders for new vehicles became the foremost priority of Detroit’s Big Three along with the few remaining independents. Without a doubt, being a seller’s market was a very positive development for domestic automakers especially in the wake of the recent Great Depression. However, being able to fulfill the growing demand for new cars satisfactorily was an entirely different matter. In their haste to restart domestic passenger car production, federal officials did not furnish any new, practical business guidelines regarding how that transition from wartime to peacetime production might occur without interruption.

The immediate post-war years witnessed the introduction of newer, more all-inclusive business strategies instituted by the dealers themselves. They relied on those new business tactics to improve their bottom line. Planned obsolescence headed that list of new initiatives. It was not the first time that the automotive industry had utilized that particular tactic. In fact, planned obsolescence, in one form or another, had existed since the dawn of the Industrial Revolution. The successful development of inexpensive mechanized production had enabled the burgeoning middle class to buy a wide array of desirable commodities at reasonable cost. Everyday items they purchased ran the gamut from delightful trinkets and durable clothing to quality built new houses and expensive furniture. With the emergence of an even larger more vocal managerial class on the heels of the First World War, and the proliferation of all sorts of highly desired goods for immediate sale, large manufacturers focused much of their attention towards producing those items as cheaply and quickly as possible.

The up-and-coming appliance business symbolized that category of aggressive, new manufacture that intended to profit fully from the public’s insatiable appetite for its many laborsaving devices. Beginning in the early 1920s, they responded to the public’s growing demand for new products by producing a wide selection of high-end household things. They included such things as efficient gas and electric ranges, state-of-the-art refrigerators, easy to operate floor sweepers and ever-dependable vacuum cleaners. Regrettably, those moderately priced labor saving products only came with minimum warranty protection. However, advertisers repeatedly reminded their many buyers not to worry. The high quality of the products they manufactured precluded the necessity for extended warranties. If for some reason, the item, in question, required extensive repairs once its warranty protection had expired then simply buy another one.

The difference in cost between repairing that product and buying a new one was pennies on the dollar. That meant that nearly everyone could afford to buy a new one when, and if, the occasion presented itself. That line of reasoning paid off well as domestic appliance sales continued to soar throughout the 1920s. The Great Depression of the 1930s may have slowed down new car sales appreciably; however, it had little effect on the domestic appliance business. The introduction of flexible installment and layaway plans, during the 1930s, enabled many customers to purchase a multitude of highly desirable household goods at reasonable cost. Retailers and manufacturers of the 1930s believed that it was better to sell a desired product now at a reduced price, rather than store it in inventory with the idea of selling it for potentially a higher price later on.

In its earliest years of marketing and production, the domestic auto industry insisted that its numerous distributors demonstrate a certain degree of compassion when it came to selling and repairing their vehicles. Viewing automobiles as a long-term investment, led the majority of those distributors to reiterate to the buying public the growing importance of properly maintaining their vehicle regardless of the make or model involved. They claimed that proper maintenance dome through local auto franchises would not only ensure continued high quality performance; but also, would assure high trade-in value when it was time to purchase a new automobile. Practical business considerations ruled the domestic auto industry well into the 1930s. Limited natural resources during the Great Depression of the 1930s and rationing during the Second World War perpetuated that kind of sensible thinking.

However, a return to economic prosperity during the post-war years encouraged most domestic manufacturers and their many franchises to reconsider the wisdom of those long held beliefs. Increasingly, they set aside those earlier assertions that favored preventive maintenance to pursue a new and much bolder course of action known as planned obsolescence. Planned obsolescence remained the business rule for most domestic automakers and dealerships well into the mid-1970s when cataclysmic economic developments on the world stage would change everything. From the late 1940s through the late 1960s, the average life cycle for most new domestic cars ran anywhere from three to five years. The auto brand, condition of the vehicle and model year most often determined its lifespan.

In most instances, expensive automobiles retained their value far longer than medium or low-priced models. Most domestic dealers favored planned obsolescence in that it guaranteed a continual turnover in automobiles every three to five years. It worked well as long as new car prices did not increase appreciably and the buying public could easily secure reasonable loans. Radically different body styles every two to three years, in conjunction with an array of highly desirable new options and ultra-high performance engines, all but ensured great profits for prosperous car outlets during those halcyon years. Point of fact, planned obsolescence worked best when positive stock market returns exceeded earlier projections. High stock market returns often inspired new car buyers to purchase flashier, more expensive vehicles, rather than settle for traditional, lower priced models. However, any sudden downturn in the market prompted the exact opposite reaction from consumers.

The many exciting economic and political developments that unfolded in the 1950s and 1960s inspired stock market highs and lows. In the case of the majority of car shoppers, once their current auto warranty had expired, most began searching for another, newer vehicle. Those customers in the market for a new car expected sizeable allowances on their trade-ins, no matter its current condition. They assumed that the trade-in allowance would cover the down payment on their next automobile. No trade-in often resulted in even greater savings for the customer in that dealers did not have to sell or auction-off the used vehicle.

That negotiation process that revolved around planned obsolescence continued into the 1970s when a volatile international business scene ended it. Few in the auto industry could have predicted that a series of extraordinary economic and financial upheavals would not only undermine the essence of post-war capitalism as practiced throughout the free world; but also, instigate an entirely different global experience that is still with us to the present day. These earth-shattering changes drastically affected the future of the auto industry in the U.S., which soon found itself caught up in the middle of it. The five-month OPEC oil embargo, begun in November 1973, was in part a reaction to America’s recent support of Israel during the Seven Days War. It caused domestic oil prices to soar to new heights throughout the U. S. and Western Europe. Domestic businesses, both big and small, responded very quickly to the emerging economic crisis by passing along newly imposed, highly inflationary energy costs to their unsuspecting customers in the form of substantial price hikes.

Those increasing energy costs affected nearly everything sold on the market from a loaf of bread to a brand new home. All sectors of the U.S. economy suffered from it. Unfortunately, income levels for the majority of working Americans failed to keep pace with this new, rampant inflation, an uncontrollable inflation driven by the recession of 1974. In fact, people soon discovered that their dollar no longer bought the vast amount of high quality items that it once did. Adding into this unfavorable financial equation a new and baffling economic phenomenon called deflation only made matters worse. In the late 1970s and early 1980s, economists expressed growing concerns that these economic reversals, currently playing themselves out on the domestic scene, were an anomaly. Nothing like that had occurred before in the U.S.

Initially, new car sales appeared impervious to these recent economic setbacks. In fact, domestic new car sales, in 1973, reached a record new high. However, that surge in new car purchases did not last too long. The domestic auto industry soon found itself caught up in much the same kind of economic and financial stranglehold that had overwhelmed so many other businesses beginning in 1973. That economic instability only worsened for domestic carmakers as public demands for sturdier, more fuel-efficient vehicles reached a new feverous pitch. Unfortunately, domestic manufacturers were ill equipped to provide the public with what it wanted most. The sharp increase in the price of automobiles further angered a large number of consumers who began seeking out imports that were more in line with their ecological and economic needs. Those staying with domestic auto brands started to demand more all-inclusive warranties on their new automobiles.

The disinclination, on the part of most domestic auto manufacturers, to provide comprehensive warranties infuriated many buyers. A study conducted by J.D. Power as recently as 2000 pointed out that approximately 55% of all new car owners never relied on local dealers for routine maintenance once their warranty protection had expired. ^[5] Apparently, the lower costs of having one’s auto service done at a nearby independent repair shop outweighed any possible advantages that might accrue from using an authorized distributor. Shrewd customers pointed out that foreign car producers starting in the mid-1970s offered much better warrantee protection than Detroit’s Big Three. After many years of internal wrangling among the domestic automakers, they finally announced major improvements in their new car warranties. ^[6] General Motors introduced its new five-year, 100,000 miles power train coverage in 2007. It included free towing and a loaner car if repairs took several days to complete. Ford Motor Company followed General Motors lead by provided both free roadside assistance and towing up to five years. Chrysler Corporation offered a lifetime guarantee on its engines and transmissions minus the free towing.

A host of other crucial domestic issues posed even more difficulties for major U.S. automakers and their affiliates in the 1970s and 1980s. A growing public concern, in the late 1960s, over the rising levels of pollutants found in our environment not only led the U.S. Congress to establish the Environmental Protection Agency (EPA) in 1971; but also, the passage of meaningful additional legislation intended to clean up the natural environment quickly. Some of that legislation, aimed directly at the domestic automotive industry, called for more fuel efficiency and tighter environmental controls over new vehicles. All auto manufacturers, whether domestic or foreign, attempted to comply with those newly issued federal standards. Detroit’s Big Three hoped that the public would understand that any meaningful changes industry-wide would take some time to complete.

One of the biggest financial obstacles they faced, at that juncture, had absolutely nothing to do with fuel efficiency or new federally inspired environmental guidelines. It involved the long-term value of domestic vehicles. The buying public no longer wanted to pay over inflated prices for new automobiles that would lose much of their value once driven off the lot. No other high priced item depreciated so rapidly. The high cost of purchasing and maintaining new vehicles, in the highly volatile market of the late 1970s and early 1980s, prevented many car owners from even considering the possibility of purchasing new automobiles. They just could not afford to own them. Adding insult to injury, new car warranties only covered the engine, power train and transmission up to three years. Manufacturers might, or might not guarantee full protection against defective mechanical components.

Dealers did offer further warrantee protection at an added cost. However, many new owners questioned the wisdom of purchasing additional warrantee protection since it often covered components that rarely broke down over the life of a car. Persistent public pressure led domestic manufacturers to change their ways rather quickly. They developed what they called “extended factory warranties.” Experts, at that time, were highly impressed with the quick response of Detroit’s Big Three. First initiated in the 1980s, this new bumper-to-bumper protection represented a vast improvement over earlier, less comprehensive guarantees. It soon became standard on most new vehicles.
Apparently, domestic auto manufacturers finally got the message and eliminated the last vestiges of planned obsolescence. This action vastly improved the car buying experience for everyone.

Returning to the post-war years and its impact on reshaping the domestic automotive industry, one thing stands out above all else. Necessity truly proved to be the mother of invention for nearly everyone involved in large business operations. Nowhere was that innovation more evident than in the domestic automotive game. Nearly everyone wanted to own a new car, and industry leaders knew it. Hoping to satisfy that growing demand was one thing, but having the physical capabilities to achieve that goal rapidly was something else. As everyone readily conceded, retooling factories from military to civilian purposes required a period of readjustment. Detroit’s Big Three responded to that business inevitability by initiating what soon became a very effective stopgap measure. It began with them providing a limited number of warmed over versions of pre-war models to a vigilant buying public.

The used car market also profited greatly from the scarcity of new cars in the immediate post-war years. In the case of Greater Cleveland dealers, they wasted little time before advertising the many pre-owned cars available for immediate sale. For example, Kemmerling Ford, at 9900 Buckeye Road, announced, in January 1949, that every one of its many used autos must go. Hoping to expedite this process led this Ford outlet to not only offer easy payments; but also more flexible business hours. Dowd-Feder Trading Post also had a wide range of fine used cars including a 1936 Dodge for only $65. ^[7] A growing demand for used cars compelled Hull-Dobbs Ford, at 2717 Chester Avenue, to purchase them in bulk. ^[8] Central Chevrolet proudly proclaimed that it now specialized in selling top quality, pre-owned trucks in all shapes and sizes. ^[9] Packard-Cleveland, in 1950, not only inspected every automobile entering its used car lot; but also, properly steam cleaned each engine. That particular distributor also performed a complete tune up on all used vehicles as well as replaced any-and-all worn components including brakes and clutches.

Lou Meliska Pontiac, at 6700 Brookpark Road, went further with its-own special 30-day guarantee on all its used autos. ^[10]

High Level Chrysler Plymouth, at 7209 Euclid Avenue, beat out nearby competition by furnishing a lifetime guarantee on all used cars it sold. ^[11] Sensational advertising, throughout the 1950s, illustrated the growing importance of selling well-maintained used vehicles to an eager public. For example, Lou Meliska offered over 100 pre-owned cars for immediate sale. Low down payments and low finance charges separated that dealer from the pack. ^[12] The availability of GMAC financing brought large numbers of used car buyers to Michael’s Oldsmobile in the spring of 1955. ^[13] A December 1958 Cleveland Plain Dealer advertisement for Ed Goldie Dodge claimed that nobody but Ed Goldie could sell preowned cars for less and that no payment was required until February 1959. ^[14] A.D. Pelunis Oldsmobile beat all others by offering its famous “Warranty Cars.” ^[15]

The decade of the 1960s saw Meiselgate Lincoln-Mercury introduce a new six-month unconditional guarantee on all tires found on its many used cars. (Figure 30) Those buyers requiring credit had up to 36-months to pay off their bank loans at Meiselgate.^[16] The Spitzer Group offered a special “5-5-5 Plan” in 1961. Under this arrangement, anyone with good credit who had five years residence and five years at the same job now qualified for a car loan with interest rates as low as 5%. Spitzer’s tremendous new car sales volume and generous trade-in allowances enabled it to offer such sensational deals. ^[17] Bennie Blaushild furnished a special, six month, unconditional guarantee on his many high quality used cars. ^[18] Qua Buick, at the corner of East 103rd Street and Shaker Boulevard, guaranteed its many used car buyers peace of mind. That specific dealership checked back up lights, brake linings, master cylinder level, outside rear view mirror, padded dash, seat belts and two speed windshield wipers prior to any sale. ^[19] The late 1960s ushered in other worthwhile conveniences for the used car buyer. La Riche Ford, for example, now accepted credit applications over the phone. ^[20]

In the early 1970s, Central Cadillac relied on an entirely different advertising approach when it came to selling its many used autos. It claimed that about 40% of its trade-ins landed up with other dealers or wholesalers because they were just not good enough for Central Cadillac to sell. ^[21] C. Miller Chevrolet offered used car buyers an additional $100 in savings on top of that dealer’s already low prices. However, in order to qualify for those added savings the value of the used auto, in question, must exceed $480. ^[22] A March 1987 Cleveland Plain Dealer advertisement proudly announced that the Crestmont auto group was in the process of selling its entire used car inventory, which was valued at $2,000,000. ^[23] In 1991, John Lance Ford held a giant liquidation sale that featured a wide variety of quality used vehicles starting as low as $2,988. That Ford dealership sealed the deal by guaranteeing a minimum $1,000 for all trade-ins regardless of their condition. ^[24] With new auto sales down by 2009, many Greater Cleveland dealers, including Mike Bass Ford, concentrated on expanding their used car business. They did that by bidding aggressively in car auctions. ^[25]

Returning to the domestic auto scene immediately following the Second World War, the few remaining independents pursued a somewhat different business strategy than their major counterparts. Hudson, Kaiser-Frazer, Nash, Packard, Studebaker and Willys-Overland enjoyed a brief economic advantage over Detroit’s Big Three in that they unveiled their new models first. (Figures 31, 32, 33) For example, industrialist Henry J. Kaiser (1882-1967) and auto magnate Joseph W. Frazer (1892-1971) joined forces to establish the Kaiser-Frazer Company. Using the remaining assets of the recently defunct Graham-Paige Company, this new company produced the Frazer-Custom from 1947 to 1951. With its radical “Anatomic Design,” this model sold anywhere from $2,295 to $2,999. (Figure 34) It included a number of unique features including 700 square inches of glass area and a specially devised windshield that popped out in case of an accident. This automaker also produced the $2,300 Kaiser Deluxe from 1949 to 1951 and the $1,499 Henry J. in 1951. (Figure 35) The number of cars sold by Kaiser Motors varied depending on the models offered in any particular year. Its highest sales years were 1949-50 and 1952-53 when it averaged around 42,000 units a year. (Figure 36)

Joseph Frazer left the company to pursue other interests in 1951. Meanwhile Kaiser Motors purchased the Willys-Overland Company, the same auto manufacturer that had received so much acclaim during the Second World War for producing the ultimate versatile vehicle known as the Jeep. The phenomenal success of the Jeep had convinced Willys-Overland to produce its-own passenger automobiles in the early 1950s. Considered dependable vehicles in their-own right, the company sold 2,364 Willys Aero Eagle cars during the 1952 model year and 7,018 in 1953. Priced similarly to popular Chevrolet Bel Air models, the Willys Aero Eagle never gained the sizeable customer-base first envisioned by its board members in the late 1940s. Faced with the possibility of bankruptcy, Willys-Overland merged with Kaiser Motors in 1954. That recently merged company proceeded to sell the all-new Willys Bermuda the following year. Costing anywhere from $2,155 to $2,904 depending on options added, the Willys Bermuda only sold 2,200 models before the company ceased operations. Kaiser Motors stop manufacturing cars in the U.S. a short time later. ^[26]

In the immediate post-war years, Packard Motors enjoyed a sizeable lead over many of its luxury auto rivals due in part to its new business approach that encouraged its many affiliates to offer the very best possible deal on their latest entries. The all-new Packard Custom Super Clipper led the other independents in both quality and styling. Priced anywhere from $2,913 to $4,668, depending on the model involved and its accessories, the 1946 Super Clipper, in particular, symbolized an elegant new luxury vehicle that was like no other. (Figure 37) As a way of celebrating its debut, Packard-Cleveland proudly announced the expansion of its current Carnegie Avenue facility. With 11 years of experience, its seasoned mechanics now worked in an ultra-modern, 62,000 square foot service area. ^[27]

Without a doubt, the independents were enterprising during the immediate post-war years. The all-new, step down version of the 1948-49 Hudson Super 6 reflected that special innovation. It was like no other car in the U.S. at that time. Ranging in price from $2,053 to $2,836, this rugged beauty, with its roomy interior and high performance engines, rapidly caught the attention of car enthusiasts who quickly flocked to the 11 Greater Cleveland Hudson dealerships for a test drive. ^[28] Selling 143,386 units in 1950, this automaker was without a doubt a winner. ^[29] The following year, the Hudson Motor Car Company expanded its initial offering to include a wide variety of styles under both the Hornet and Wasp banners. ^[30] (Figure 38)

The obvious winner was the Hudson Hornet, which sold 43,656 units. Post-war car buyers also loved the all-new Nash. All ten Greater Cleveland Nash dealerships proudly displayed their latest models with their very spacious interiors and rattle free steel frames. ^[31] The Nash Motor Company unveiled its brand new Ambassador line of streamlined vehicles in January 1950. (Figure 39) Priced In the $3,325 to $3,445 range, no other mid-century domestic automobile featured such things as an airflyte design, reclining seats and twin bed spaciousness. ^[32] This automaker sold 205,307 Ambassador Supers in 1951. Unfortunately, the financial success enjoyed by Nash Motors did not last long as its car sales began dropping in 1952-53. Its inability to keep up with the styling changes, initiated by Detroit’s Big Three, ensured its decline. To demonstrate this last point, Nash only recorded only 22,309 new car sales during the 1959 model year.

Many of those highly innovative vehicles sold so well that several independents seriously considered expanding their current manufacturing capabilities in order to meet this growing public demand for their special vehicles. Some of them went so far as to propose the mass production of a wide range of new and unique vehicles in a multitude of price ranges. That might have even included European-inspired, limited edition sports cars. Unfortunately, their ambitious business plans rarely got much beyond the drawing board. That euphoria did not last long as most independent manufacturers quickly discovered that they could not sustain their early new car sales lead over their formidable Detroit rivals. As everyone knew even in those days, extensive research and development efforts accompanied by major national publicity campaigns, often funded by wealthy stockholders, represented the ultimate key to long lasting financial success. Well-healed investors not only guaranteed Detroit’s Big Three a more than adequate amount of capital for prolonged periods; but also, provided them the breathing space necessary as their engineers, marketers and planners worked earnestly to develop their latest business plans. Unable to keep pace with the ever-changing domestic car market meant that only a select group of independents wielded any sizeable influence industry-wide after mid-century.

In a very true business sense, the majority of independents languished once Detroit’s Big Three initiated their-own extensive new marketing and sales campaigns.
As early as the spring of 1948, their highly orchestrated sales campaigns redirected the public’s attention away from the few independents towards some of the best-designed automobiles ever built in Detroit. The few remaining holdouts saw their percentage of market sales drop from 20% in 1929 to 4% by 1954. Independents soon realized that they could not possible compete against the combined efforts of Detroit’s Big Three. The 1950s symbolized a period of phenomenal business change characterized by an unprecedented number of big mergers, and the auto industry was no exception to that rule. New business and engineering innovations affected nearly everyone in the auto manufacturing game. In fact, some of the business decisions made by the Detroit Big Three then continue to affect decision-making right to the present-day.

Through the 1950s, Detroit’s Big Three remained the standard-bearer when it came to producing new and exciting auto designs. For example, Ford Motor Company in 1949, 1952 and 1957 completely revamped its three car lines and it was not alone in its actions. (Figure 40) The Board of Directors at General Motors also modernized its five domestic car divisions beginning in 1949. (Figure 41) It approved further design changes in 1954, 1958 and again in 1959. (Figures 42, 43 & 44) At the same time, General Motors investors insisted that all its autos maintaining a certain degree of design uniformity. That conformity in design, so evident in 1950s models, was the culmination of an austerity business plan initiated by Alfred Sloan two decades earlier.

During the immediate post-war years, Chrysler Corporation continued to lag behind Ford and General Motors when it came to revamping its car designs. Part of its reluctance to change with the times originated with its conservative President Kaufman Thuma (KT) Keller (1885-1966). He believed that the buying public, above all else, cherished comfortable seating and a host of practical features found in his company’s many well-crafted automobiles. (Figure 45) The box-like style, first introduced by Chrysler Corporation in 1949, reflected his rigid thinking in that regards. With more than ample interiors and large trunk space, Chrysler products particularly appealed to growing families. Special limited edition models such as the 1946-48 Chrysler Town and Country convertible and sedan sold fairly well. Featuring all-steel bodies trimmed in white ash, they cost anywhere from $4,003 to $4,665 depending on added options. (Figure 46) In fact, Chrysler sold over 12,000 units in that three-year period. ^[33] Another unique model for the 1949 model year was the Dodge Wayfarer. At $1,727, the Wayfarer featured a non-electric soft-top and Plexiglas snap on side windows.

The inclusion of a powerful hemispherical head V-8 on select Chrysler models, starting in 1951, symbolized a major engineering breakthrough for this leading Detroit car maker. This powerful engine directly challenged similar engines produced by Ford and General Motors. However, the hesitation of the Chrysler Board of Directors to update its body designs to serve the changing needs of its diverse customer-base did not ensure its future growth. In addition, its lack of highly desired, affordable options such as a fully automatic transmission meant fewer new car sales over the long run. That led to a change in ranking among Detroit’s Big Three. Chrysler Corporation dropped from second place to third place in overall sales in 1953 based on the recent surge in new auto sales at Ford Motor Company. Chrysler never regained its sales lead over its Dearborn competitor.

K.T. Keller’s retirement in 1954 instigated a number of important changes. Now under the capable leadership of Lester Lum (Tex) Colbert (1905-1995), Chrysler wasted little time before approving sweeping design changes for all its passenger car divisions. They also introduced a collection of new, high performing engines. The buying public thoroughly approved of these new “Forward Thinking” designs first introduced in 1955. They also liked the major styling changes in 1957 and 1959. (Figure 47) These beautifully crafted vehicles also caught the imagination of a growing number of customers who were captivated by the all-new jet plane. Easily identified by their soaring rear fins, enormous wrap-around windshields and chrome-laden bodies, these vehicles bore a striking resemblance to contemporary jet aircraft. Streamlined designs and phenomenal engineering breakthroughs, these streamlined vehicles with their automatic headlight dimmers, electric windows, electric windshield wipers, dashboard rear view mirrors, portable car radios, push button accessories and tinted glass windshields symbolized the very best Detroit’s Big Three had to offer in the 1950s.

Mid-century stylists continually experimented with both plastic and fiberglass design forms. These boldly executed designs with their exotic color schemes and excessive metal trim undoubtedly captured the imagination of the buying public. Lower, longer and wider than earlier car models, many of these latest offerings touted high performance V-8 engines. Although some design elements and special details were universal, customers rarely confused the latest Chrysler product with others produced by either Ford Motor Company or General Motors. The many designs emanating out of Detroit’s Big Three may have appeared similar at first glance; however, the inclusion of special accessories, uniquely crafted bodywork and splendid detailing definitely distinguish one vehicle from another within the same company and one make from another.

Some of the major technological improvements to gain widespread popularity among new car buyers in the 1950s ranged from air conditioning, dual carburetors, dual heating units and electric radio antenna to fuel injection engines, power operated front seats, push button automatic transmission and quad headlights. Noteworthy models included the Chevrolet Corvette at $2,799, the Cadillac Series 62 Eldorado at $7,750 and the Pontiac Bonneville convertible at $5,782.

The independents also offered their-own versions of dream cars. They included the Kaiser Darrin Roadster at $3,668, Nash Healey Roadster at $4,721, Hudson Italia Roadster at $4,800 and Packard Caribbean convertible at $5,210. ^[34] (Figures 50, 51, 52 & 53) Chrysler Corporation did not lag far behind the others when it unveiled its-own special dream car called the K-310. ^[35] Although the Chrysler K-310 never went into full production, many of its most popular design elements soon reappeared on other models. (Figure 54)

The all-new Chrysler Imperial definitely caught the public’s attention when it debuted at the Greater Cleveland Chrysler dealers in 1955, as did the sensational new Plymouth Fury coupe just two years later. ^[36] Chrysler manufactured over 11,000 Imperial hardtops, limousines and sedans in the 1955 model year and 7,438 Plymouth Fury coupes in 1957. (Figures 55 & 56) The street version of the Chrysler 300-C also debuted in 1957. Available with a stick shift, its V-8, 392 cubic inch engine could accelerate from 0-60 mph in just over eight seconds. Like its competitors Hudson Motor Car Company and Nash Motor Company, Chrysler engineers also experimented with unibody chasses. Putting aside engineering advances and design experimentation for the moment, Chrysler products sold fairly well during the second half of the 1950s with the exception of its one lackluster brand of cars called the De Soto. First introduced in the 1928-29 model year, Walter Chrysler saw the new De Soto as a possible challenger to Dodge. However, De Soto executives quickly realized that their new line of vehicles would probably sell much better in the mid-price range. That reversal in strategy soon paid-off. De Soto became the showstopper at the New York City Auto Show in 1932 when over 122,000 people visited its booth. ^[37]

In fact, De Soto held its-own during the immediate post-war years selling 144,649 vehicles in the 1951 model year. Some of its unique features included electric chair high seats, electric windshield wipers, power brakes, power steering, power windows, safety rim wheels and smooth shock absorbers. ^[38] The 225 horsepower pace car for the 1956 Indianapolis 500, De Soto claimed to be the most powerful car in the medium price field.^[39] Unfortunately, those recent sales gains did not last long. Similar in design to the slightly more expensive Chrysler, the De Soto line of automobiles never truly found its own customer niche. Poor sales in 1959, due to the recent recession, assured its elimination. However, that did not prevent Chrysler from adding new De Soto distributors, right to the end. For example, Clarence Fox opened a new De Soto dealership in Lakewood, OH in 1959. ^[40] The last De Soto rolled off the assembly line in 1961. Periodically, Chrysler’s board discussed the idea of reviving the De Soto name and banner, but nothing ever materialized.

Ford Motor Company designs were equally impressive throughout the 1950s. The beautifully designed 1955 two seater Thunderbird at $2,944 and the ultra-chic 1956-57 Lincoln Continental Mark II at $9,695 received a great deal of praise from the national press. (Figures 57 & 58) However, pleasing new car designs was not the only reason for that company’s renewed financial success. In order to remain at the top, its shrewd Board of Directors developed a new and effective system of accountability and quality control that quickly transcended the rank-and-file. It began in 1954 when Ford Motor Company unveiled its-own special quality control center dedicated to improving overall assembly line production. Recent complaints about shoddy workmanship prompted this unprecedented action. In another surprising move, Henry Ford II announced, in September 1956, that the company planned to re-join the Automobile Manufacturers Association (AMA) after a 43-year absence. AMA supported numerous industry-wide programs. ^[41]

Hoping to gain a further edge over its two major Detroit rivals, Ford Motor Company, in 1957, revealed its latest car sensation, the retractable hardtop. Called the Skyliner and costing around $2,942, this innovative vehicle, under the Fairlane 500 banner, incorporated the best features of both a convertible and hardtop into one. The company sold 20,766 Skyliner models in 1957 and 14,713 the following year. Interesting side note, Ford Motor Company had used the Skyliner name earlier in the same decade for a unique two-door Crestline hardtop. That model featured a see-through, green colored Plexiglas roof insert placed above the front seats. The earlier version of the Skyliner did not sell well mainly because the car’s interior became unbearable hot when exposed to bright sunlight. (Figures 59 & 60) The fall of 1957 saw car shoppers eagerly inspecting a brand new line of mid-priced automobiles called Edsel. Named after the founder’s son Henry Ford and costing about $3,000, the new Edsel line of automobiles attempted to compete against other middle price favorites such as Oldsmobile and Pontiac. ^[42] (Figure 61)

The marketing strategy employed by Ford Motor Company to sell the Edsel reaffirmed family values along with the prestige of knowing you owned the latest new member of the growing family of quality Ford cars. ^[43] Edsel new car sales numbers for 1958 stood at a respectable 63,110 ranking it 12th in overall domestic sales for that year. However, the number sold the following year dropped to 43,000 units. Nineteen fifty-eight was the year that Ford unveiled its-own four-seater version of the popular Thunderbird. This $3,700 personal automobile replaced the two-seater model that had debuted three years earlier. (Figure 62) Although poor new car sales forced Ford Motor Company to discontinue its Edsel division, Lincoln Continental Mark II and Fairlane 500 retractable hardtop, sales of the new Thunderbird exceeded 38,000 during its first production year. It ranged in price anywhere from $3,631 to $4,222 based on accessories.

The Chrysler family of fine cars also sold moderately well during the second half of the decade, as did the five General Motors passenger car divisions. (Figure 63) However, the phenomenal financial success enjoyed by Detroit’s Big Three did not spill over to the few remaining independents, although certain of their models did sell well. Faced with the prospects of bankruptcy, a number of independents merged. Merger fever reached a new high point in 1954, when Hudson Motor Car Company and the Nash Motor Company joined forces to establish American Motors Corporation (AMC). Hudson continued to manufacture its-own passenger cars into 1957 when it sold only 4,000 units. Under the shrewd guidance of its President George Romney (1907-1995), the new AMC initiated a number of positive changes beginning with the reworking of the once popular Nash Rambler. Built from 1950 to 1952, the original Nash Rambler cost about $2,000. This modified version of that once very popular compact at $1,500 was an instant moneymaker for AMC. Over the next decade, the compact Rambler enjoyed phenomenal success. It surpassed Plymouth to become the number three automaker in 1961. The many financial incentives offered by AMC and its equally enterprising distributors accounted for much of that recently earned success. For example, Cleveland-based Southland AMC/JEEP, at 6976 Pearl Road, in 1979, sold an all- new $3,971 Sprint hatchback for as low as a $100 down payment. Its 48-month payment plan with an annual interest rate of 10.9% was popular with many penny-wise Clevelanders. ^[44]

Being the exact opposite of the top selling, gas-guzzlers of the day accounted for much of Rambler’s early financial success. Its solid construction, overall comfort, easy handling and quality performance were additional benefits. ^[45] AMC may have found a practical solution to the financial dilemma facing its predecessors; however, the same did not hold true for the Packard Motor Car Company. An upsurge in new car sales for both Cadillac and Lincoln may have been partially responsible for Packard Motors dismal new car sales record in the early 1950s. However, it was not the only business factor leading to the decline of this once highly respected domestic car maker. The growing popularity of fashionable European luxury entries such as Bentley, Jaguar, Mercedes-Benz and Rolls Royce, along with more luxurious Buicks, Olds and Chrysler Imperials was equally significant. Packard Motors newest models failed to stack up. The high quality standards that had once made Packard Motor Car Company the premier domestic luxury automobiles were long gone. The wealthy customers that had once depended on Packard had all but disappeared by mid-century.

The decision by its Board of Director’s during the Great Depression of the 1930s to sell a less expensive version of its top selling model may have enabled Packard Motor Car Company to stave off bankruptcy in those years, but not forever. Former Packard car owners increasingly purchased other luxury brands. By the mid-1950s, automotive critics contended that the company’s less than prudent decision to limit the number of models it would produce, during the phenomenal upsurge in domestic car sales immediately following the Second World War, led to the precarious financial situation presently facing this once undisputed leader of the luxury car market. Automakers with more available capital would have used that rare economic opportunity after the Second World War to increase, not decrease, its percentage of the domestic automobile trade by flooding the market with their-own high quality vehicles. Had they done that then it would have shown the buying public that Packard Motor Company was indeed here to stay.

Additionally, the inability of this automaker to change body designs quickly convinced many previously Packard owners to look elsewhere when it came to purchasing new vehicles. In the early 1950s, the company’s dynamic new president James J. Nance tried to improve Packard’s tarnished business image by offering a number of highly desirable accessories such as conditioning and new suspension at cost. Nance’s business strategy apparently worked as Packard new car sales for the 1951-52 model year fell just below 128,000 units. Had Packard Motors been able to rely on Briggs Manufacturers to produce some of its more costly models, that automaker might have been able to survive the devastating financial losses it incurred later in that same decade. Unfortunately, that did not happen. Chrysler Corporation purchased Briggs Manufacturing for $35,000,000 in December 1953. Growing production problems in 1955 and 1956 only worsened the already tenuous financial situation facing this once legendary Detroit automaker. Sensing that there was something very wrong with Packard, the buying public bought fewer and fewer of them. In a last ditch effort to save this automaker, Packard Motor Company, in 1956, unveiled a completely separate line of new luxury cars called the Clipper. (Figure 64) A nicely designed model with well-appointed interiors this new line of cars cost anywhere from $2,730 to $3,164 depending on the options added. Unfortunately, it did not sell well and the company eliminated it two years later.

At the beginning of the 1950s, Packard Motor Car Company had considered merging with either Hudson or Nash; however, nothing transpired. With new car sales dropping to new all-time lows, Packard, in the mid-1950s, announced plans to merge with Studebaker Corporation. These two well-known independent automakers became one in 1956. Their immediate plans called for offering a brand new Packard model the following year. A highly respected domestic car designer named Dick Teague (1923-1991), in conjunction with the popular Italian car maker Ghia, followed through with that promise and built two prototypes both under the Predictor name. A typical late-1950s streamline automobile with a powerful 300 horsepower engine, the Predictor never reached the production stage.

Another proposal that called for a European-inspired sports car, also under the Packard name, failed to materialize.

Unfortunately, Studebaker Corporation was not faring much better financially. Founded in 1852, this once highly respected carriage maker had transformed itself into a successful automobile manufacturer at the turn of the last century. It sold mostly low to medium prized vehicles through its nationally recognized network of distributors. In both the 1920s and 1930s, automotive experts continually praised Studebaker as a worthy independent that had successfully managed to survive in spite of the recent groundswell of change. Recognizing its economic importance as an independent car maker, Cleveland-based Englander Motors, in 1939, became Studebaker’s eighth local distributor. Its owner A. L. Englander had been selling cars for nearly 30 years. Like the company he now proudly represented, Englander dedicated himself to providing the highest quality repair service at a reasonable cost. ^[46] Being an independent enabled Studebaker to offer certain business advantages over other, larger rivals. In particular, Studebaker could easily reinvent itself when market conditions warranted such action. The many bureaucratic entanglements inherent in operating Detroit’s Big Three did not lend itself to that kind of business flexibility. In fact, any major changes initiated by Detroit’s Big Three often took as long as three years to complete.

With a tidy sum of cash on reserve for development, marketing and research purposes, Studebaker executives embarked on a very ambitious plan immediately following the Second World War. They offered a new series of ultra-modern designed automobiles well before Detroit’s Big Three had the opportunity to capitalize fully on the growing domestic market for new cars. Raymond Loewy studios, in 1947, unveiled two new Studebaker models the Champion at $1,472 and the Commander at $1,775. Known as the “the next look,” the buying public loved these vehicles. In fact, Studebaker new car sales topped 228,000 in 1949 peaking at 270,604 by 1950. Two beautifully designed coupes the $2,500 Starlight and the $3,182 Golden Hawk made their debuts in 1953 and 1957. Regrettably, assembly line problems limited the first year production of the Starlight to only 55,500 units. Critics pointed out that the problem with this model was not its design or quality, which was first rate. The problem involved price. It cost about $600 more than the best Chevrolet. (Figure 66)

Apparently, Studebaker was less than cost efficient when it produced that particular model. Critics also made a similar argument when that same automaker introduced the Golden Hawk four years later. Studebaker Corporation only made 5,200 of them in the 1957-58 model years. Officials had hoped that the merger with Packard Motor Car Company would provide them a large infusion of much needed additional capital that would go towards modernizing their aging factories. Hoping to increase its percentage of the domestic market led Studebaker to unveil a brand new full line of smaller cars in 1959. Called the Lark and priced around $2,300, Studebaker sold more than 130,000 in its first production year. (Figure 67)

General Motors Corporation did not encounter the same kind of financial uncertainties that confronted smaller domestic auto producers such as Packard or Studebaker. Huge sales prompted General Motors to update its very popular Chevrolet Corvette in 1963. Now known as the Stingray, this completely redesigned domestic sports car cost anywhere from $4,252 to $4.353. General Motors sold 21,513 units that year. (Figure 68) Seeing the Corvette evolve, from a small, six-cylinder, personal two-seater into a powerful eight-cylinder, world-renowned sports car, in just one decade, represented a significant achievement for Detroit’s number one automaker. Corvette’s legend of excellence continues to the present day. Surprisingly, Buick new car sales also exceeded earlier projections for the 1962-63 model years. (Figure 69) The 11 Greater Cleveland Buick dealers offered a winning lineup of vehicles that included the luxurious Electra series, the practical LeSabre models, the lively Wildcat and the thrifty Skylark.^[47]

As one of the few remaining independents, Studebaker entered the limited car market in 1961 with the Grand Turismo. A beautifully designed model, it only cost $3,095. (Figure 70) Its styling may have resembled other contemporary vehicles, such as the 1957 Packard Dream Car, 1958 Ford Thunderbird and 1959 Pontiac Catalina/Star Chief; however, its spacious interior and nimble handling distinguished it from the rest. (Figure 71) In the autumn of 1963, Studebaker took this idea of beautiful design to an entirely new plateau when it introduced its-own European-inspired sports car. Called the Avanti and costing $4,445, this finely crafted, personalized vehicle may have caught the fancy of sports car lovers worldwide, but not domestic auto buyers. Studebaker only produced 4,600 Avanti units that first year. (Figure 72) A customized version of that sports car called the Avanti II costing $6,550 reappeared from 1966 to 1971 and again in the 1980s. In an attempt to avert bankruptcy, Studebaker Corporation, in 1964, moved its corporate headquarters from South Bend, IN to Hamilton, ON. (Figure 73) That move proved to be only a stopgap measure with the company filing for bankruptcy two years later.

The decade of the 1960s symbolized a period of extraordinary growth for Detroit’s Big Three. Even though leading economic indicators, by the mid-1960s, strongly suggested a decline in new auto sales was long overdue, that negative projection did not seem to bother Chrysler, Ford or General Motors. They appeared oblivious to the possibility that their current sales records might not last forever, and that serious economic problems loomed on the horizon. The growing number of foreign cars in a market formerly dominated by Detroit’s Big Three concerned some shrewd economists. They viewed that intrusion into the domestic auto scene as the first signs of a faltering economy. This was not an entirely new phenomenon. It had happened earlier in the 20th century. In fact, the economic insecurities of the mid-1960s closely resembled the financial difficulties prevalent throughout the 1920s. Both markets relied extensively on unrestrained speculation and easily attained credit to ensure its resilience. By the mid-1960s, leading national economists had repeatedly warned industrialists that rampant speculation backed solely by easy credit if allowed to continue unchecked would soon undermine the enormous economy strides achieved by the U.S. and its allies following the Second World War.

Analysts recommended that domestic automakers might want to study the unpredictable car buying habits of the public in order to get a better idea on what may lay ahead for them. These experts further predicted record new car sales for imports, over the next ten-year period, especially if domestic car makers failed to heed their warnings right now. They concluded that the reluctance of Detroit’s Big Three to accept those inevitable changes might prove financially disastrous for those companies once current high volume sales levels seriously declined. Those dire economic predictions did indeed materialize. Vastly different buying trends, commencing in the 1970s, substantiated those earlier warnings. The proliferation of successful import car dealerships only reinforced those ominous predictions. Many distributors now sold a wide variety of foreign entries that ranged from Volkswagen, Saab and Volvo to MG, Jaguar and Renault.

Inexpensive foreign cars particularly appealed to a great many including college students, money-strapped young adults and senior citizens, anyone who shied away from purchasing large, gas guzzling cars out of Detroit. However, those same customers had absolutely no qualms about owning environmentally friendly, smaller vehicles manufactured in Europe or Japan. In addition, some domestic dealers did not hesitate to take advantage of this latest craze by selling both domestic and import models under the same roof. In the case of Cleveland, David Blaushild Chrysler-Plymouth, at 16005 Kinsman Road, proudly sold the Simca, a small French import alongside his popular domestic brands. ^[48] This trend of selling domestic and imported vehicles at the same dealership continued to grow in popularity into the 1970s and 1980s due in large measure to the expanding global economy. Cleveland-based Hal Artz Lincoln Mercury sold imports manufactured by Bertone, Pininfarina and Renault. ^[49] Ganley BMW, Jay Honda, Spitzer Kia and Ron Marhofer Nissan typified Greater Cleveland domestic auto distributors who also sold popular imports. In the early 1960s, Volkswagen was the undisputed import new car sales champion. By the end of that decade, leading Japanese carmakers including Datsun, Honda and Toyota had begun selling large numbers of their vehicles within this burgeoning market scene. Those highly affordable, mechanically sound vehicles were no longer oddities owned by a select few. Their significant recent success posed a serious threat to Detroit’s Big Three especially as the volatile 1970s began to unfold.

As was pointed out earlier, the incursion of imports into the 1950s domestic auto scene had very little, if any impact on the kind of cars that Chrysler, Ford or General Motors manufactured. Detroit’s Big Three continued to offer a wide assortment of standard-sized vehicles in different price ranges. With the idea of dominating the small car market, these leading domestic producers manufactured their-own versions of compacts and sub-compacts starting in 1960. The Chevrolet Corvair at $2,400, Plymouth Valiant at $2,230, Ford Falcon at $2,300 and Mercury Comet at $2,400 were immediate hits with the buying public. (Figures 74, 75, & 76) The following year, General Motors broadened the specialized car market when it unveiled several other compacts, again at various price levels. They included the Buick Special at $2,800, Pontiac Tempest at $2,500 and Oldsmobile F-85 at $3,049. Their growing popularity convinced Detroit’s Big Three, in 1962, to offer a number of intermediate sized vehicles such as the Ford Fairlane 500 at $2,350 and Chevy II Nova at $2,500. (Figures 77, 78 & 79) The Chevy II remained popular with money conscious buyers well into the 1970s. For example, Cleveland-based Jackshaw Chevrolet, in 1970, sold brand new, never titled, Chevy IIs for as low as $1,990, and that included a five-year or 50,000 power train warranty along with a host of other, highly desired safety features. ^[50]

A shakeup at Chrysler Corporation led to Bill Newberg (1910-2003) replacing Tex Colbert as president in 1960. A conflict of interest, several months later, led to Newberg’s unexpected resignation. Tex Colbert, Elwood Engle (1910-1986) and Virgil Exner (1909-1973) filled the void created by his sudden departure. In what many auto experts of that era considered an unusual business move, Chrysler’s Board of Directors announced its latest plans that called for downsizing its full-size Plymouths and Dodges beginning in the 1962 model year. (Figures 80 &81) Rumors had been circulating for a while that Chevrolet intended to do that same thing the next model year. Chrysler officials seized upon the moment in an attempt to beat its chief rival General Motors at its own game. Their latest strategy proved ill advised. Hastily conceived and poorly executed, smaller sized Plymouths and Dodges did not sell well. Their squared-off design, accentuated by elongated hoods and truncated rears, did not measured up when compared to the more stylish Chevrolet Impala or Ford Galaxie 500. In fact, poor new car sales saw Plymouth’s overall rankings drop from third place to fifth place, with Dodge remained in ninth spot. Plymouth did not return to the number three spot until the 1970s.

The Dodge division attempted to regain some of its lost customers by offering a wide range of desirable factory incentives. In December 1961, the 12 Greater Cleveland Dodge dealers sold fully equipped brand new vehicles beginning at $2,288. That price included a push button radio, push button heater, self-adjusting brakes plus all taxes and transportation costs. ^[51] Two years later, local successful dealers, including Sonny Thompson at East Cleveland Dodge, offered full-size new vehicles for as low as $1,899. That distributor also provided special bank financing up to 37 ½ months. ^[52] Chrysler executives placed full blame for their recent financial debacle on Virgil Exner. At the same time, they ordered the return of full-sized Plymouths and Dodges starting with the next model year. Ironically, Exner, who had come to Chrysler Corporation from Studebaker in 1949, was the person most responsible for the successful “Second Forward Look” streamlined designs that had distinguished Chrysler products in the late 1950s. Smaller cars did not return to the Chrysler fold until the late 1970s, when it introduced the $3,299 Plymouth Volare and $ 3,495 Dodge Aspen models. With the full intention of remaining on the cutting edge of innovation, Chrysler’s board, in 1963, invested heavily in its latest version of a gas turbine engine as designed by Elwood Engel. (Figure 82) Chrysler Corporation commissioned the famous Italian automaker Ghia to build 50 hardtops powered by those very engines.^[53] Chrysler’s marketing department had planned to sponsor a national publicity campaign intended to drum up widespread support for its latest entry. Unforeseen legal entanglements, that limited the number of foreign made autos allowed to enter the U.S. that year, thwarted those earlier highly ambitious plans.

As the 1960s started to unfold, another group of new and exciting Detroit-inspired automobiles made their debut. Led by the $2,372 Ford Mustang, $2,466 Chevrolet Camaro, $2,955 Pontiac Firebird and $2,499 Plymouth Barracuda, these “pony cars” literally appeared out of nowhere. Cheap fuel prices encouraged increasing numbers of customers, in all age groups, to purchase these fun automobiles. At the same time, domestic carmakers were working diligently on developing yet another kind of high performance vehicle. Known as “muscle cars,” these entries that included the Chevrolet Camaro at $3,500, Chevrolet Chevelle SS at $3,100, Dodge Charger at $3,100, Pontiac GTO at $3,101, Pontiac Grand AM at $4,600, and Plymouth ‘Cuda at $3,600 soon gained a sizeable following. (Figures 83, 84, 85, 86 & 87)

Other muscle cars soon to arrive on the automotive scene included the Plymouth Road Runner at $3,000, Shelby GT 350 at $4,300, Oldsmobile 442’s at $2,600 and Ford Mustang at $2,500. These high performance cars became the unanimous choice of many discriminating drivers who wanted agility, performance and style in their newest automobiles. In many ways, they symbolized Detroit’s immediate answer to hot rods. However, unlike those earlier custom jobs, which were driven mostly on raceways or wide-open stretches of remote highways late at night, these new, high performance gems could go anywhere anytime. Still prized in today’s market, muscle cars remained very popular into the 1970s. Escalating prices, acerbated by federal and state environmental controls and increasing fuel costs, marked the end of those amazing, highly personalized autos. At the time of the Millennium, a new kind of muscle car made its appearance. Similar in many ways to its predecessors, these all-new high performance autos have enjoyed some success with the more recent buying public.

The 1970s symbolized a turning point for the domestic automotive industry as the sales of new car imports surpassed Detroit’s Big Three. Just the opposite had been the case a decade earlier. Unfortunately, that earlier buying trend did not last long as imports continued to make even greater economic strides within the domestic market. The problem facing Detroit, in the 1970s, was far greater than they were willing to admit. Without a doubt, they had begun to lose their edge to foreign automakers, and they had no one to blame but themselves for this latest business catastrophe. New global trading partnerships, promulgated by similar-minded overseas carmakers, stressed the growing importance of masterfully integrating the finest manufacturing, marketing and distribution techniques into their individual corporate cultures. If done properly, it would afford them a decided economic and financial advantage over their U.S. counterparts. Foreign auto producers fully understood, right from the beginning, that their future success depended on following that model precisely. Their ability to cut costs whenever necessary, while still keeping their debt controllable, was truly amazing.

However, closer investigation suggests that there was no great secret as to how they attained such lasting financial success. Once these foreign companies successfully established their customer niche, within the domestic scene, then they could begin the arduous task of building upon their recently acquired positive business reputation for product excellence. They accomplished the latter by providing their diverse customer-base with the kind of highly reliable reasonably priced vehicles the public needed and wanted. Their recent financial successes gained even greater momentum as they increasingly perfected their earlier well thought out business strategies and techniques. That had also been the case when the domestic auto industry was in its infancy, and it still held true only this time for import automobile producers. The governing economic and financial principles responsible for sustaining profitable, entrepreneur-related businesses, such as these, had not changed appreciably over the previous seven decades, even if, the individual companies leading that charge were radically different.

Behind the scenes, newly emerging economic, political and social developments had begun to erode the well-established world order of yesterday. These unprecedented changes undermined the accepted economic and political system as first articulated by the U.S. and its allies in the aftermath of the Second World War. That tightly woven alliance began unraveling in 1971 when the Nixon Administration announced that the U.S. planned to quit the gold standard. That shocking news occurred on the heels of growing domestic economic and political turmoil due to the civil rights movement, the youth rebellion and recent military loses incurred during the Vietnam War. Over the previous four decades, many of this nation’s leading economists had convinced themselves that purposely controlling the amount of money in circulation represented a very effective way in which to regulate inflation by holding government spending down to a bare minimum.

Those experts wedded to that thinking contended that fiscal responsibility meant that federal officials had the obligation to increase national gold reserves before placing any additional paper currency into circulation. The greenback must truly be worth its weight in gold they said. On the negative side, their actions encouraged foreign governments to exchange their greenbacks for gold whenever it served their interest. Known as dollar-flush, it enabled those countries to drain domestic gold reserves on a regular basis. The Nixon Administration argued that this widely accepted practice must end. By removing the U.S. dollar from the gold standard, federal officials would ultimately eliminate recessions, while stimulating long-term growth and sustaining high employment. President Nixon further contended that over time this action would serve to reduce this nation’s trade deficit by making the U.S. even more competitive within the growing global arena. Price stability represented yet another economic benefit derived from such action.

Theoretically, removing the U.S. from the gold standard should have given this country a significant economic advantage over those that did not follow its example. This economic benefit would become even more apparent in the not so distant future when the U.S. renegotiated its international trade agreements. Unfortunately, it did not turn out that way. Instead, of eradicating obstacles for the U.S. it made this nation even more vulnerable economically. This became very apparent during periods of recession. Much of the problem stemmed from the fact that the dollar’s value recurrently fluctuated in the open market due to this country’s floating debt. The uncertain value of the dollar, predicated largely on the amount of national debt carried by the U.S. at specific intervals, failed to reassure its many trustworthy trading partners. This was especially true for those countries that had always depended on the U. S. to maintain the gold standard if for no other reason than to protect everyone else from unscrupulous global investors. Removing that long established safety net, at a time of great economic instability worldwide, may have appeared economically advantageous to the U.S. in the early 1970s. However, it was anything but a prudent move to make at that juncture. The subsequent breakdown of the established economic order only reinforced earlier fears expressed by that country’s astute allies.

The OPEC oil embargo, as initiated by a disgruntle group of Middle East oil producing nations, symbolized the second in a series of earth-shattering events that traumatized the domestic automotive scene. Wanting far greater profit from each barrel of oil extracted from their fields, led the OPEC membership in 1973 to stage an international boycott. Aimed primarily at Western Europe and the U.S., this boycott would remain in effect until those Middle East oil-producing nations received their fair share of the profits. The boycott led both federal and business leaders to mandate a series of energy restrictions, the likes of which the U.S. had not experienced since the rationing days of the Second World War.

The preparations taken by business leaders were very exacting. The first thing affected was energy costs. Inexpensive oil and other equally important energy sources suddenly soared to new, unprecedented high price levels. The second phase involved the manufacturing and distribution costs for virtually all domestic products. Literally overnight, costs nearly doubled. Escalating prices, prompted in large measure by new, over inflated energy costs, immediately affected the public’s buying power. Some motorists responded to this latest crisis by seeking out other forms of transportation including car-pooling and public transit. Major financial reversals on a multitude of levels, prompted mainly by the 1974 recession, led first to double-digit inflation followed by deflation. These prodigious economic developments undermined traditional business principles that had long governed the U.S. economic system. In retrospect, it was inevitable, a logical outcome to the lack of firm economic and financial safeguards emanating from Washington.

Foreign car manufacturers eagerly watched those developments unfold. In the case of Japanese automakers incorporating the latest managerial techniques and finest available technological into their well-established production and distribution networks enabled their manufacturers to far exceed their wildest earlier car sales projections. Part of their extraordinary economic and financial success rested on their ability to integrate top-notch business practices and procedures, learned in part from successful U.S. manufacturers, into their-own uniquely defined corporate cultures. Adopting the best from both worlds resulted in a new, more highly efficient workforce that for all practical purposes was immune to the kind of internal labor squabbles that had traumatized U.S. factory workers and corporate executives for so many years.

Using what they called “lean production,” a combination of the very best found in U.S. assembly line traditions along with their-own meticulous inspection of each-and-every stage of production, empowered Japanese automakers to eliminate virtually all the flaws that inevitably occurred during this repetitious manufacturing process. Such close monitoring enabled Japanese manufacturers to sell reliable vehicles to thousands of customers at a fraction of Detroit’s Big Three costs. The addition of such things as “space-saving inventories” and “Just in Time” production methods in which manufacturers shipped auto parts by trucks to factories 24/7 ensured the proper amount of materials needed to complete any production run on time. ^[54]

Detroit responded to this mounting overseas economic threat by conducting business as usual. The high costs involved in revamping their massive operations prevented them from acting quickly. They knew that It would take months, if not years, to complete major plant renovations. That realization prevented many automakers from acting speedily especially when it came to allocating large amounts of hard earned capital aimed towards modernizing their aging factories, retraining workers and replacing worn out equipment. Unlike their counterparts in the U.S., import car manufacturers did not need extensive lead-in time to modernize their operations. Lower infrastructure costs and less preparation time enabled them to change their modes of operation relatively easily. In spite of Detroit’s reluctance to alter traditional business practices, Chrysler, Ford and General Motors enjoyed several more years of high new car sales before that growing inertia adversely affected its bottom line.

The introduction in 1973 of “A” bodies in the Buick, Oldsmobile and Pontiac divisions helped new car sales top the $1,000,000 mark. Top sellers in the General Motors car lineup included two compacts made by Chevrolet. Its Vega, with its specially adapted four-cylinder engine, sold quite well for a number of years, as did its affordable Chevette. Modeled after the popular European auto known as the Opel Kadett, the Chevette appealed primarily to buyers with modest incomes. With the intention of profiting more directly from the new and expanding domestic market for Japanese automobiles, General Motors, over the next decade, purposely established limited partnerships with two of its chief rivals.

The first involved a merger with Isuzu in which General Motors obtained 49% ownership of that Japanese auto manufacturer. That collaboration lasted until 2006. A second merger in 1981 with Suzuki lasted for nearly 30 years. Dearborn executives enjoyed similar profit gains without pursuing limited partnerships with competing Japanese automakers. In the early 1970s, the Board of Directors at Ford Motor Company decided to follow another business strategy closely. This time it aimed at gaining a larger percentage of the domestic compact car market by manufacturing two small models geared primarily for younger drivers. It proved to be a very rewarding move for Detroit’s number two auto producer.

Chrysler and General Motors welcomed the new business challenge posed by officials at Dearborn when they introduced two new compacts the Ford Maverick and the Ford Pinto. Without a doubt, the $1,900 Maverick was the showstopper. (Figure 88) An outgrowth of the earlier, highly popular Ford Falcon and Mercury Comet series, the all-new Ford Maverick came in both two door and four door models. The Pinto was somewhat different from the Maverick in that it was a sub-compact designed to compete against the Chevrolet Vega. (Figure 89) Better riding than the Vega it enjoyed a ten-year production run even though it suffered from both emission control issues and safety problems.

In spite of this recent surge in domestic new car sales, other equally unsettling new business problems disturbed these previous tranquil economic waters. One major concern facing Detroit’s Big Three, in the early 1970s, involved the future of the convertible. Once considered a prestigious model, the convertible had lost favor with the public as of late. Poor sales had convinced AMC to drop its convertible line in 1968. Four years later, Chrysler Corporation also stopped making convertibles followed by Ford Motor Company the next year. General Motors remained the sole Detroit holdout continuing to produce convertible models into the mid-1970s. Those special entries cost anywhere from $8,500 to $14,000 depending on the brand, model and options involved. (Figure 90)

In the autumn of 1976, General Motors announced that its Buick, Chevrolet, Pontiac and Oldsmobile divisions would stop manufacturing convertibles at the end of that current model year.^[55] Corporate executives suggested that dwindling sales, new federal safety standards and the growing popularity of air conditioning led to that decision. Some of the domestic car makers tried to appease former convertible owners by offered them moon roofs or sunroofs instead. However, that was not enough. Growing customer complaints about the lack of convertible car lines forced Detroit’s Big Three to reconsider their earlier action. The 1980s saw the gradual return of convertible models often as sports model alternatives to traditional four-door sedans, station wagons and two-door coupes.

The 1970s truly represented a period of great change within the domestic auto industry that went far beyond offering brand new models with eye-catching accessories. Leasing automobiles became a very viable option for many money-strapped customers. Industry studies indicated that more than 2,000,000 people leased cars in the United States in 1974 as compared to just over 1,000,000 ten-years earlier. Higher quality leased vehicles, and a growing realization by a shrewd buying public that it made economic sense to purchase low mileage rentals, seemed to have been the two economic catalysts responsible for that dramatic change in thinking.

In addition, a new federal law that required auto dealerships to sign odometer disclosure statements before selling any used car provided additional assurance for those wishing to purchase rental cars. Failure on the part of a dealer to comply fully with the terms of this new disclosure law meant that dissatisfied car owners could now seek punitive damages in civil court. Practically speaking, unhappy buyers could claim triple damages or $1,500 whichever was the greatest difference between the actual and represented mileage of the auto in question.^[56] One of the major advantages of buying a leased vehicle with low mileage was that many of them featured a wide array of highly desired amenities. Rough treatment by some careless drivers represented one of the few drawbacks in purchasing those late model vehicles.

Civil Rights legislation in the 1960s, led many large companies, including domestic automotive manufacturers, to reconsider the narrowness of their current business strategies with the expressed intention of eliminating older policies that might appear prejudicial to the interest of minority groups. That prompted more minority-owned dealerships. In fact, the number of minority-owned dealerships increased from 10 out of a total 27,000 showrooms in 1970 to 71 out of 30,000 showrooms by 1976. General Motors took the lead with 28 followed by Chrysler with 24 and Ford with 19. Strong recruitment efforts and relevant dealer training geared towards the particular needs of minority owners seemed to spark that initiative. ^[57]

The 1967 summer riots in Detroit, MI, followed by the well-publicized minority capitalism program introduced during the Nixon Administration made this recruitment effort suddenly a top priority. Leaders in the automotive business mostly recruited experienced minority leaders with sizeable bankrolls. Auto manufacturers intended to improve their chances of success by locating those new minority owned dealerships in highly desirable suburbs or smaller towns. They shied away from placing them in traditional inner-city neighborhoods. The number of minority owned distributors grew at a steady rate for the remainder of the 20th century. General Motors helped the cause when it announced its latest intentions that called for adding 76 more minority owned dealerships from 1990 to 1995. ^[58] Its shrewd corporate leadership targeted potentially lucrative new markets in cities such as Chicago, Detroit and Houston. By 1995, the percentage of Hispanic and Asian owners constituted roughly 2% of General Motors more than 9,500 franchises. The percentage of Ford and Chrysler minority owned dealerships, at that juncture, was 5.7% and 2.9% respectively.

General Motors reluctance, in the beginning or the 1970s, to discard many of its outmoded business practices had serious financial repercussions for the nation’s largest automaker later on. Apparently, that auto manufacturer did not fully acknowledge the fact that many large international corporations had already begun miraculous business changes designed to keep their company in step with the times. Instead of introducing a wide range of new, more energy efficient automobiles for a far more demanding buying public, Detroit’s number one auto producer did the exact opposite. Overblown gas guzzling versions of automobiles, emanating from its Chevrolet, Pontiac, Oldsmobile, Buick and Cadillac passenger car divisions, continued to flood the contemporary auto scene.

Some of those full-sized models sold well, while many others barely exceeded production costs. The majority of these cars seemed old fashion especially with the new baby boomer generation who increasingly wanted smaller, more fuel-efficient vehicles. Finally realizing that they were losing out to its shrewd overseas rivals, General Motors executives ordered an abrupt change in their business strategy. It began with revamping their aging factories and building new ones as soon as possible. Once operational, these refurbished and new assembly lines would enable this leading domestic automaker to produce a wide number of fuel-efficient automobiles in rapid succession. In addition, corporate officials ordered the revitalization of their five car divisions commencing in 1976.^[59]

Unfortunately, this urgency to modernize assembly lines, with the idea of manufacturing smaller, more efficient vehicles, had not yet reached the board rooms of Chrysler or Ford. The number two and three Detroit manufacturers continued to offer a wide assortment of full-sized automobiles in different price ranges. It seemed the logical thing for them to do at that time. Surprisingly, a large number of General Motors owners concurred with that thinking. After sizing up the situation, many former General Motors buyers began purchasing full-sized cars made by Chrysler or Ford instead. General Motors Board of Directors expressed dismayed at this sudden turnaround in its new car sales. However, its board members knew that manufacturing smaller, more efficient cars was the right course of action to follow at least for the immediate future.

Updating their present factories and downsizing some of their more popular vehicles may have only represented an initial, and at best, modest attempt by that giant company to satisfy the increasing demands by both government officials and the buying public for more efficient automobiles. ^[60] However, it symbolized much more than just some feeble gesture by General Motors to quiet mounting criticism. It represented the first in a series of business initiatives that would eventually culminate in the complete overhaul of that corporation’s factory system. If it proved successful, it would result in far more efficient vehicles in the not so distant future. Although the General Motors autos, introduced in the 1977, were lighter, narrower and shorter than the previous year’s models, their interior space and cargo areas were much the same as their immediate predecessors. This aggressive, new strategy, on the part of the number one automaker, would yield respectable profits over time; unfortunately, first year sales were not that impressive. ^[61] As stated earlier, neither Chrysler nor Ford strategists chose to follow General Motors lead in this regard.

In the case of Ford Motor Company, it continued to produce full-size models well into the 1980s. The price of their vehicles covered the spectrum from inexpensive Ford Pintos and Mercury Bobcats, at one end, to high priced Lincoln Mark IVs and Ford Thunderbirds, at the other. ^[62] (Figure 91) Ford executives wisely decided to promote the Mustang separately. That tactical move made perfect sense since the Mustang generally sold well. On another level, Ford learned the importance of adhering to “lean production” soon after it purchased 24½% ownership rights to Mazda, a popular Japanese auto manufacturer in 1979. That partnership lasted until 2015.

Chrysler faced a crucial economic dilemma second to none during the late 1970s. On the brink of bankruptcy, it sought out a buyout package from Washington officials. The Chrysler Corporation Loan Guarantee Act of 1979 saved the number three Detroit automaker from extinction by instituting U.S. government backed loans worth $1,500,000,000. ^[63] Chrysler also received an additional $2,000,000,000 in other commitments and concessions. Dwindling sales, throughout the late 1960s and early 1970s, acerbated by the recent deluge of popular imports into the fragile U.S. market, all but eliminated this once viable auto producer. Through the years, Chrysler’s propensity to manufacture consistently high quality cars had failed to generate the kind of customer loyalty so evident at both General Motors and Ford Motor Company. One might have thought that Chrysler’s sudden reversal in fortunes might represent a major financial windfall for its two chief competitors. It did not. The possible elimination of one of this major competitor meant much more to them than just a desperate act taken by an ailing company. Their complex economic and financial relationship represented a closed watched, intricate interdependency built up over the course of many years. Their daily interaction transcended traditional business bounds.

Leaders at General Motors and Ford prudently weighed the long-term as well as short-term economic consequences for their respective companies should Chrysler go out of business. After some careful deliberation, they announced that General Motors and Ford wholeheartedly supported the proposed federal bailout package. What the public might not have realized, at that moment, was that the number three domestic auto producer had purchased many of its vital components and auto parts from its chief competitors. General Motors and Ford subsidiaries, along with thousands of unnamed independent suppliers, many located in the Midwest, had enjoyed lucrative business contracts with Chrysler Corporation for many years. ^[64] Chrysler’s bankruptcy would negatively affect the two remaining Detroit car producers. It would throw off the balance, the well-established business relationship created by Detroit’s Big Three over the previous seven decades.

Rumors had been circulating that if Chrysler closed its doors then the federal courts, in a veiled attempt to prevent possible future monopolies from occurring, might require General Motors to sever its business ties with its Chevrolet division. The idea of giving up its new car sales champion held little appeal for the number one domestic auto company. The same held true for Ford Motor Company. In that case, the federal courts might compel the number two Detroit manufacturer to sell off its profitable Ford division. Therefore, General Motors and Ford agreed on the importance of keeping Chrysler financially afloat, if for no other reason than to guarantee their-own future economic well-being.

Federal officials concurred and approved the bailout package. Under the able leadership of Lido Anthony (Lee) Iacocca (b.1924), Chrysler Corporation set about on the unenviable task of trying to reverse its recent new car sales losses. Iacocca had joined the number three Detroit manufacturing team in November 1978. His well-earned business reputation for toughness stemmed, in large measure, from his maverick approach towards both business and marketing. Iacocca had risen within the corporate ranks of Ford quickly in the 1950s. He became that company’s president by 1970. Business disagreements with its Chairman Henry Ford II prompted his firing eight years later. Board members named Phillip Caldwell to replace him.

It was incumbent upon Iacocca to bring Chrysler back from the brink of bankruptcy. The newly appointed President along with its Board Chairman John J. Riccardo (1925-2016) announced, in August 1979, that they would voluntarily reduce their salaries to $1.00 a year for the next two-years. However, that action did not preclude Iacocca from continuing to receive $1,500,000 in deferred bonuses from Ford. ^[65] Disorganization among the rank-and-file best described the Chrysler Corporation throughout the 1970s. Its absence of any formal committee structure along with its unusually high number of Vice Presidents, lack of interaction among its department heads and virtually no financial controls sapped Chrysler of any financial strength it might otherwise have enjoyed.

The handwriting was on the wall. By the late 1970s, this once leading auto manufacturer could no longer produce the kind of vehicles demanded by today’s buying public. Lee Iacocca immediately demanded greater accountability from his corporate leadership. He also understood that Chrysler Corporation’s tendency to introduce the right car at the wrong time must also end. In response, he initiated major cost cutting measures intended to reduce present expenses by more than $500,000,000. He also proposed a new, comprehensive five-year business plan that would put Chrysler financially in the black soon.

With the idea of securing some needed capital quickly, Chrysler sold its fledgling division called Airtemp to Fedders Corporation in 1976. That $58,500,000 transaction involved cash, notes and stocks. The Board of Directors also approved the sale of one of its major assembly plants in Westmoreland, PA, to Volkswagen for about $28,000,000. Three years later, the Board of Directors permitted the $125,000,000 sale of Chrysler Realty to Abko Realty. Experts suggested that Abko Realty got a great deal since the estimated value of Chrysler Realty stood at about $430,000,000. Unfortunately, those publicized deals did very little to reverse recent losses. By 1979, company losses totaled $1,100,000,000. If Chrysler Corporation had closed its doors then it would have meant nearly 800,000 job losses. The serious nature of this problem should have been more than a sufficient warning sign to both General Motors and Ford to institute significant business improvements now starting with modernizing their aging assembly plants. The question facing both of them, in the uncertain 1980s, was how best to meet the changing needs of their customers for better quality automobiles and more gadgetry, without significantly raising prices annually. Accomplishing that formidable task would require great finesse and it was anyone’s guess as to how best to pursue that pressing matter.

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