Fallen Flags

The American auto industry's "Big Three" are on the ropes, claiming to face imminent bankruptcy if the government won't give them billions loans, which looks like it may not happen. General Motors and Chrysler are in the direst shape, with Ford somewhat better off.

While both the concatenation of events leading to this situation and the potential scope of failure are unprecedented, the loss of a brand (or three, or even an entire multibrand manufacturer) is not.

Oldsmobile was a recent single-brand loss. Ditto Plymouth a few years back. Thirty years ago, it was the "Big Four," the fourth being American Motors, which was born from the merger of Nash and Hudson in 1954 and which even in the late 1970s was in trouble. An alliance with Renault failed to save AMC, and it was swallowed up by Chrysler in 1987. The Eagle nameplate survived for a few years after that; Jeep is still with us.

Before that, there was Studebaker. Best known for innovative (or was it outrageous?) styling in the late 1940s and early 1950s, and the futuristic Avanti of the 1960s, Studebaker predated the automobile. The company started as a wagon-builder in the mid-19th century, and constructed many of the Conestoga wagons that brought pioneers to the American west.

Studebaker merged with Packard, one of the most-respected American luxury-car makers before World War II, about the time of the Nash-Hudson marriage. Packard was the only independent (not owned bu GM, Ford, or Chrysler) American luxury automaker to survive the Great Depression, but production and styling difficulties put it in trouble after WWII.

Packard also suffered from going downmarket in the late 1930s. That was a survival move at the time, but the company's reputation was tarnished--fatally. After the merger with Studebaker, Packard vehicles were little more than badge-engineered Studebakers. Packard's inevitable demise came in 1958.

The other postwar American automaker to fail was Kaiser-Frazer/Willys-Overland. All those hyphens, all those mergers were clearly indicative of trouble. Henry J. Kaiser made his fortune in shipbuilding during WWII, and needed to diversify after the military-cargo and -transport market disappeared. With Joseph Frazer, formerly of Graham-Paige, he started Kaiser-Frazer and made some uniquely-styled cars that failed to capture the market share needed for survival. So in 1953, Kaiser-Frazer bought Willys-Overland. Willys-Overland built cars, but was best-known for a small, general-purpose military transportation vehicle, the Jeep. Jeeps kept Kaiser in the automobile business long after car production ceased, but Jeep was finally sold off to AMC in 1970. And then to Chrysler in 1987.

So, Jeep is a survivor, having outlived Willys, Kaiser, AMC, and now, perhaps, Chrysler.

If it can be sold to anyone.

There's the rub today. Chrysler has survived two near-death experiences, and has come back from each stronger than ever, only to revert to failure. The "merger of equals" with Daimler failed, and current owner Cerberus's intentions have never been completely clear. If parts are to be sold off, only Jeep could really stand on its own. Again. But there are no American manufacturers to buy it, or foreign ones, at this point.

GM needs to shed brands, but in a less expensive way than was done with Oldsmobile. Chevrolet and Cadillac are the core. Opel, the European branch (with British Vauxhall) and source for the newest Saturns, is also in trouble.

Ford says it's OK, although an available line of credit wouldn't hurt. It is leaner than GM, but I don't see a rosy future for Mercury. Maybe it will be folded more into Lincoln?

Note that it's not just the automakers that are in trouble. Outside suppliers are more responsible now than at any time in history since the very earliest days for design and construction of subsystems like seats, electrical and electronic equipment, air bags, and more. Even one manufacturer failing would bring some suppliers to the brink...and they also work with import brands who have plants in the country. And then there are dealers and repair shops. Plus, the automobile industry and its suppliers are a major component of the American economy. Decimation means recession turns to depression...

History is like sausage; it's much more pleasant when sampled at a later date than after witnessing its being made...

P.S. As with living organisms, the list of extant automakers is far dwarfed by those extinct. Click here for a list of by-gone automakers.