1930 Studebaker
by Kay Novy
Title
1930 Studebaker
Artist
Kay Novy
Medium
Photograph - Photography
Description
This photograph was taken at the Riverside Hotel And Casino in Laughlin, Nevada.
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, but not quickly enough. 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. Instead of reorganizing in receivership, Erskine committed suicide, leaving it to 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.
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August 11th, 2014
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