Sales Ad Saturday- James Nance named President of Packard
This week in 1952 marked the beginning of the end for Packard for this week's 'Sales Ad Saturday’. Jim Nance was elected President of Packard on May 8th, 1952. Nance was charismatic, driven, and considered a highly competent and well-respected executive, who had earned a solid reputation with his previous work as Vice President at Zenith radio, and CEO of GE’s Hotpoint division.
Packard had tried to hit the ground running after the war, but its immediate offering was little more than a warmed-over continuation of its tired 1942 Clipper models for both ’45 and ’46. Sales picked up dramatically in ’48 when Packard nearly doubled production with the introduction of the controversial and unfairly derided 22nd series “Bathtub” Packards. It was not an easy time; the company had been having trouble acquiring steel, running in the red, and spending lots of money preparing production infrastructure for planned annual production of 200,000 cars, a goal set by then-President George Christopher which the company never came close to achieving. By ’49, Christopher was out, replaced for a few years by Hugh Ferry until Ferry selected Nance to assume his role, while Ferry became Chairman of the Board. Under Ferry’s leadership, the company introduced the uninspired 24th series Packards in March of ’51 but also introduced the stylish Pan American concept car, which was soon developed into the iconic Caribbean when introduced in ’53. When he took over, Nance wasted no time making lots of organizational changes internally. Forced retirements of many older company executives and the recruitment of lots of younger talent were aimed to develop a more youthful corporate culture. One of those youthful hires was a young engineer named John DeLorean, who stayed with Packard for 4 years.
Nance’s first full year was fairly successful, with Packard selling over 90,000 cars. The company would never come close to those sales levels again. A credit crunch in ’54 hurt most automakers, but Packard sales fell particularly hard, down 65% compared to 1953, with just over 31,000 cars sold. Things picked up a little in 1955, with a fresh new design known internally as the “First Series”, which found 55,000 buyers. Unfortunately, the development of these cars was rushed and badly mismanaged. While the new cars were quite advanced for their time, they were plagued with a variety of issues not properly sorted out before production began. The first series damaged Packard’s image, and Packard spent tens of millions of dollars fixing customer's cars.
Nance believed the key to successfully taking on the Big Three was the consolidation of the independents. Not long after taking over, he and executives from other companies began initial discussions to consolidate the four automakers; Packard, Nash, Hudson, and Studebaker into one company, better poised to compete in the market. Nash and Hudson completed a merger of their own, forming American Motors in May of ‘54. In July of ’54, Packard and Studebaker made the regrettable and hasty decision to merge as well. Shortly after, initial discussions were underway for a merger of the two companies; American Motors and Studebaker-Packard, but for a variety of reasons, including a rejected demand that Nance would be President of the new conglomerate, a deal never materialized. Nance remained President of the new Studebaker-Packard corporation while Studebaker’s Paul Hoffman became Chairman. Although Studebaker had consistently sold more cars annually than Packard, Studebaker was in terrible financial shape. Poorly managed and hemorrhaging cash, something Packard would not fully realize until after the deal was finalized, the company was in desperate need of Packard’s rapidly diminishing capital, much of which had been borrowed by Nance that year. In less than two years time, Packard was in deep trouble as the failures of the ’55 Packards kept prospective buyers away in ’56. Packard sales plummeted to just 28,000 cars, which were the last of the ‘real Packards’.
With the financial deadweight of Studebaker hanging over him, Nance found that no bank would consider any further financing when Packard practically ran out of cash in 1956. A Senate inquiry into Packard’s financial situation that year found issues with government manufacturing contracts that had been taken from the automaker and given to GM instead. Nance resigned under pressure, and not long after he did, Studebaker management entered into a three-year management agreement with Curtiss-Wright. With the agreement, Studebaker received the operating capital it needed to continue, while the hugely profitable Curtiss-Wright enjoyed a hefty tax write-off from the losses of the two companies. That agreement led to the plundering of Packard. Curtiss-Wright sold the Packard plant in Detroit, took over Packard’s Utica engine plant for their own operations, and sold Packard’s proving grounds to Ford. What little remained of Packard's operations were moved to Studebaker in South Bend, and the Packards for ’57 and ’58 were little more than re-badged Studebakers. Sales amounted to no more than 5,543 cars in ’57 and a scant 1,745 for ’58 when the last of the “Packardbakers” rolled off the line- a quiet end to one of the most prestigious American automakers in history.