The top 10 reasons why Packard died

Although Packard was losing sales annually in the early 1950s, it was still a strong company. Many feel if the automaker had shelved its ambitions to fill every segment of the market and instead concentrated on being a low-volume luxury producer of roughly 80,000 units a year—which it could have easily done—it would have been profitable and strong in spite of being a one-marque pony.

Don’t forget that Volkswagen, Mercedes, and—by the mid-1960s—Toyota and Datsun were single-marque producers in the U.S. But Packard President James Nance was fixated on merging with Nash, Hudson, and Studebaker to become the fourth “full line” auto manufacturer. In this scenario Packard would become the premium brand, with Hudson covering the Chrysler/Buick segment, Nash below that, and Studebaker handling the bread-and-butter Chevy/Ford/Plymouth market. Once Packard merged with Stude and American Motors President George Romney refused to consider a merger with Packard, it was the beginning of the end.

Here are the top 10 reasons why Packard died:

Moving its plant

1954 Packard convertible
1954 Packard convertible Thom Taylor

Nance was an animated, driven man who looked at modernization as a key for both manufacturing and selling better products from his days running the appliance maker Hotpoint. The Packard plant on East Grand in Detroit was an old two-story facility. Modern assembly plants were on a single story, and so Nance sought such a plant.

Finding the Connor Avenue Chrysler plant available, he purchased it to assemble the heavily updated Packard for 1955. The fact that it had one-fifth the floor space of the Grand Avenue plant was of only minor concern. Single-story manufacturing was more efficient and modern. When production started at the Connor plant, the line was so crammed it was hard for workers to perform certain tasks, leading to shoddy building, and fixes were necessary at the dealer level. Packard, known for its high quality, was now seen as third rate by the public, and it cost Packard heavily from a warranty standpoint. The new 1955 Packards, advertised heavily with positive reception and deposits, were delayed, and once manufacturing got up to speed it never met the minimum daily production seen at Grand Avenue.

The never-was all-new 1955 Packard

1955 Packard Clipper Super Panama
1955 Packard Clipper Super Panama Thom Taylor

Packard had an extensive program being developed for 1955 that included ingenious component sharing for a range of both Studebakers and Packards. Contemporary and stylish, they would have propelled the new company. But money was never available for the development necessary for these all-new cars slated first for 1955, then for a 1956 release. After the disastrous 1954 sales year, Packard was never seriously in a position to deliver on its extensive future planning.

Studebaker misled Packard before merging

 With due diligence necessary in any merger, Studebaker either misled or calculated incorrectly when assigning profits. Stude determined it would take 120,000 cars to break even. In 1950 and ’51, Studebaker produced more than 300,000 cars each year. But Studebaker’s manufacturing facilities were old, assembly was slow, and union troubles meant continual worker stoppages and strikes. After the merger, Packard accountants analyzed Studebaker’s figures and realized it would take almost 300,000 vehicles annually for Studebaker to break even, which it never came close to fulfilling after 1951. Studebaker drained millions of dollars from Packard right from the start, and it never stopped.

Late V-8

1956 Packard Caribbean hardtop
1956 Packard Caribbean hardtop Thom Taylor

By 1950, Packard saw it would need an overhead V-8 to be competitive, but development and testing took years. Its straight-eight engine, an anachronism from the 1930s, would have to be good enough until the new V-8 finally arrived in 1955. By comparison, Cadillac and Oldsmobile got V-8s in 1949, and even money-strapped Studebaker offered one by 1951. Four years later, it was too-little, too-late for Packard.

Losing Briggs Body

Packard was known for making the finest automobile bodies in America, but to save costs it decided to farm out its body development to Briggs Manufacturing in the 1940s. In 1952, Chrysler bought out Briggs, agreeing to continue providing bodies to Packard through 1954, when Packard’s contract ended. Midway through finishing the heavily revamped 1955 models and moving manufacturing to the Conner facility, the chore and money drain to get back into the body stamping business cost time and money, and there were numerous body-fit problems once those first 1955s came off of the assembly line.

Dealers bailing and waiting for discounts

1936 Packard 120 Victoria
1936 Packard 120 Victoria Thom Taylor

Packard’s dealers were a smart lot. They had a habit of keeping their inventories very low, waiting for the yearly factory discounts to kick in, when they could get plenty of Packards at reduced prices. In addition, both Chrysler and Ford waged campaigns to steal Packard dealerships, leaving Packard with an ever-dwindling and more-isolated dealer network. It was another built-in hurdle that Packard could never fix.

Gravy defense contracts evaporated

“Engine” Charlie Wilson was president of General Motors for years before being called upon to take over military manufacturing for the Eisenhower administration. Naturally, he favored GM, so the numerous military contracts that helped Packard make up its manufacturing losses started moving across town and into General Motors’ hands. Even Eisenhower saw the problem and advised Wilson to show Packard some love, but those contracts never reached the level they had been previously during Truman’s presidency. It became another unexpected development that cost Packard heavily.

Crosstown rival

Packard’s nearest competitor was Cadillac, which after WWII was a styling and engineering juggernaut. Dramatic styling, use of chrome, elegant interiors, and the ability to freshen up every year—if not advancing a completely new car every two-three years—was hard for smaller Packard to match. The new line of Packards and Studebakers planned first for 1955 (and then 1956) would have yanked the company back into the high-style parade, but it was too busy trying to stop the bleeding to divert precious funds toward development.

1953 Packard convertible
1953 Packard convertible Thom Taylor

New shall soon be old

Packard’s all-new 1951 “high pockets” design was considered a styling milestone when it was introduced, but the high beltline meant a thick body mass, which quickly became old—especially parked next to a finned and sleek Coupe de Ville. The revamped 1955 Packards were a step in the right direction, but there was only so much the styling department could do with carry-over stampings from 1951. To the public, Packard looked like a stodgy, old man’s car.

No credit, no company

After James Nance left Packard, he became the vice president of marketing at Ford—we’re not kidding. That didn’t last long, and he moved back to Ohio and became president of a large bank, advising his peers that being on the giving end of loaning money was far superior to the borrowing end that he’d been accustomed to during his time in Detroit. Boy, was he right. Packard could always rely on credit lines to get through rough times, but as the company bled money following the Studebaker merger, banks grew scared of the direction Packard was headed. One by one, they pulled their credit lines. When the last bank said “no” in 1956, Packard consolidated its product line and assembly into Studebaker, and except for the unwanted “Packardbakers” in 1957 and ’58, it was finished manufacturing cars.

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Comments

    I agree. Their demise should never have happened. However, Nance made some very bad decisions. Buying Studebaker was the worst one and it killed Packard. Nance himself was a bad hire for Packard. The restyled 1948 Packards were just incredibly short sighted for Packard as well. An all new car was needed in 1948 and not a bloated bathtub. Furthermore, to the man who tried to reboot Packard, YOU PICKED THE WORST DESIGN EVER FOR A PACKARD. THERE WAS NO BEAUTY IN THAT REHASHED 1948 DESIGN!

    “Packards should still be around”…? Baloney. They went out of business, because their product wouldn’t sell. It wouldn’t sell, because the product became an industry-wide joke for poor build quality, terrible performance compared to competition, and unreliability. The post-war Packard Company was not the same company, nor were its products comprabloe to the pre-war Packard Company. Post-war Packards are a monument to why the USA became de-industrialized.

    Yes they should, my dad for a poor man was able to have 2 of them once and were quite & fast too.

    James Nance also eliminated the inventory of replacement parts company-wide. This made life difficult for Packard owners to maintain their older vehicles. They could no longer count on a full store of Packard parts.
    Nance’s merger deal with James Mason at AMC was ready to go through, but fell apart when Mason died on October 8, 1954. George Romney, AMC’s new CEO, canceled the deal. This resulted in Packard/Studebaker being unable to fully benefit from the corporate merger: thus profit from selling engines and transmissions to AMC was transient and soon stopped entirely.
    Another player in the loss of Packard was Eisenhower’s Secretary of Defense, Charles Wilson. Wilson was the former CEO of General Motors. He assigned multiple defense contracts to GM. Packard was left in the cold.

    Nance couldn’t stomach the idea of not being in charge. Romney and Nance butted heads. Nance was wrong as history shows. He should have saved Packard and Romney could have done that. Nance was all about Nance. He sucked at Ford too.

    The transmission problems with the 1955 and 56 Packards did not help either.Also the torsion level system was an unrefined experiment that was not needed.Their legendary engineering fell flat on its face and public
    confidence was gone for good.I owned a nice low mileage 1955 Patrician and it was a good example of what a
    car should not be.I am now 86 and am content with Lincolns.

    My 56K mile 1955 Patrician was the coolest car. I loved the suspension. It made everything else in 1955 yesterday’s news. Lincoln was a hash job in ‘55. The styling was all over the place. The back half of the car was stylistically unrelated to the front. And what about that old windscreen? Wrap around glass was in vogue. Even a 1955 Ford had that. What happened to Lincoln?

    Yes, the 1955 Lincoln was an obvious facelift of the 1952 while everyone else had some kind of wraparound windshield. The 1956 Lincoln was all new and one of the more amazing cars of the 1950’s. Maybe they were shooting for 1955 (along with Ford and Mercury, which had parts of their bodies in common with the 1952s but it didn’t show, with mostly new greenhouses and station wagon bodies) but were taking too long so they did a facelift instead for 1955.

    Why was the Patrician not a good car? I have a 1936 Super 8: had quality and/or engineering really deteriorated so much by the mid-fifties?

    Quality was still very good. Nance wanted a one story manufacturing plant. His choice, again, was a bad decision for Packard. The old plant produced excellent cars. The new one did not. Nance ruined Packard with his bad decisions.

    ‘Imitation is the sincerest form of flattery.’ –

    Packard cars were so stylish and so beautiful that the Soviet Union emulated their aesthetic with the Zis 1941. Cars today are an eyesore.

    We were on Indiana 63 on our way to the Beef House in Covington for Sunday dinner. A Turquoise 1955 Packard Caribbean passed my Civic at about 75 or so with the top down. down. It was about 50 degrees. I liked following the car so much I tailed him for a while. Then he tromped it and white smoke poured out the dual exhausts, swirling a bit. The Civic eased up.

    i have a 1955 Packard 400 -2 dr. hardtop , and the design is very good . I’m sorry that the new 1957 Redesign was never produced , as it would have outsold Cadillacs ! See Dwight Heinmuller new book for the full information on the Detroit 1957,1957 and 1958 New Designs !

    I am hearing that there may be a return of the Packard.Anyone hear of this?Supposedly with a plant in Ohio,
    I have owned a 1935 Super Eight convertible with 6 wire wheels and a “rumble”seat and a 1951 200,and a 1952 two door sedan and a 1953 4 door with overdrive then a 1955 Patrician.That was a jukebox a and the 3 Ultramatic transmissions that failed plus the Rube Goldberg suspension that used the buying public as a testing ground.The 1956 was a good looking car but people were afraid of them and bought Cadillacs and Lincolns instead.I have owned a 1955 Cadillac and a 1955 Lincoln and the Cadillac was the better car.Two 1976 Buick Electra 225’s,one was loaded and the other too close to a Chevrolet with few options.Usually when a car maker folds up tje chances for a resurrection are zero.Thay all had their chance,shot their wad rejection was certain.

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