page_title: Studebaker
section_title: Impact of the 1930s depression
hierarchical_section_title: Studebaker / History / Impact of the 1930s depression
caption_attribution_description: File name: 06_10_014608 Title: Glenn Motor Sales, 600 Saginaw St., Bay City, Mich. Date issued: 1930 - 1945 (approximate) Physical description: 1 print (postcard)&#160;: linen texture, color&#160;; 3 1/2 x 5 1/2 in. Genre: Postcards Subject: Automobile service stations Notes: Title from item. Collection: The Tichnor Brothers Collection Location: Boston Public Library, Print Department Rights: No known restrictions
context_page_description: Studebaker was an American wagon and automobile manufacturer based in South Bend, Indiana. Founded in 1852 and incorporated in 1868 as the Studebaker Brothers Manufacturing Company, the firm was originally a producer of wagons, buggies, carriages and harnesses. Studebaker continued to manufacture other diversified products after automobile production ceased in 1966.
  Studebaker entered the automotive business in 1902 with electric vehicles and in 1904 with gasoline vehicles, all sold under the name "Studebaker Automobile Company". Until 1911, its automotive division operated in partnership with the Garford Company of Elyria, Ohio, and after 1909 with the E-M-F Company. The first gasoline automobiles to be fully manufactured by Studebaker were marketed in August 1912. Over the next 50 years, the company established a reputation for good quality and reliability.
  After years of financial problems, the company merged in 1954 with luxury carmaker Packard to form the Studebaker-Packard Corporation. However, Studebaker's financial problems were worse than the Packard executives had thought.
context_section_description: Few industrialists were prepared for the Wall Street Crash of October 1929. Though Studebaker's production and sales had been booming, the market collapsed and plans were laid for a new, small, low-cost car—the Rockne. However, times were too bad to sell even inexpensive cars. Within a year, the firm was cutting wages and laying off workers. Erskine maintained faith in the Rockne and rashly had the directors declare huge dividends in 1930 and 1931. He also acquired 95% of the White Motor Company's stock at an inflated price and in cash. By 1933, the banks were owed $6 million, though current assets exceeded that figure. On March 18, 1933, Studebaker entered receivership. Erskine was pushed out of the presidency in favor of more cost-conscious managers. Albert R. Erskine committed suicide on July 1, 1933, leaving successors Harold Vance and Paul Hoffman to deal with the problems.
  By December 1933, the company was back in profit with $5.75 million working capital and 224 new Studebaker dealers. With the substantial aid of Lehman Brothers, full refinancing and reorganization was achieved on March 9, 1935. A new car was put on the drawing boards under chief engineer Delmar "Barney" Roos—the Champion. Its final styling was designed by Virgil Exner and Raymond Loewy. The Champion doubled the company's previous-year sales when it was introduced in 1939.
  In 1938, the company built a new factory in Vernon, California, which remained in production until 1956. At one time, the facility was producing 65 cars a day. The factory manufactured the Champion, the Land Cruiser, and the Starlight.
caption: Studebaker dealer in Michigan, circa 1950–52
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