Cormorant #162 - "What Went Wrong"

General topics, not covered elsewhere, of all things Packard.
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Mahoning63
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Cormorant #162 - "What Went Wrong"

Post by Mahoning63 » Tue Feb 16, 2016 5:21 pm

Just received the latest Cormorant and read Brian Burke’s article “What Went Wrong From 1953 – 1956” focused on Packard production schedule and other sales missteps that cost it millions in revenue and did irreparable damage to its dealers. I congratulate Brian on an exceptional analysis, is one of the best I’ve read and very well written. A fabulous education with relevance even today. Thanks Brian for sharing your insights!

Paul West

Dave Czirr
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Re: Cormorant #162 - "What Went Wrong"

Post by Dave Czirr » Wed Feb 17, 2016 8:38 pm

Agreed, a nicely written and though-provoking article by Brian.

5682-4775
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Re: Cormorant #162 - "What Went Wrong"

Post by 5682-4775 » Sat Feb 20, 2016 5:15 am

Hi

I too want to congratulate Brian Burke for writing such a compelling and in depth article highlighting another significant situation that contributed to Packard's downfall. Dealer stability or lack thereof was taken as an indication of the overall condition of a car company. The general public didn't for the most part have intimate knowledge of the car business, read dealer stability as an indication whether they should spend their hard-earned automotive dollars on a particular make.

Year-end clearance sales were an expected action then as they still are now, but when major quantities were still being pushed into the next model year, it was a red flag there was something amiss. This was especially true for the independent carmakers. The conclusion would be there was something wrong with cars that didn't sell when they should have, the public having no way to know how badly the production versus sales was being mismanaged.

The driver behind this overproduction might be nothing more than the ego of a new, inexperienced company president trying to demonstrate to the industry how quickly he was turning around his faulting company. Nance may have thought it good to be seen as pushing Packard and its dealers to produce at rates unseen in years. That the under-staffed and under-financed dealer body produced as well as they did should be recognized for the yeoman effort it was in the face of unreasonable demands.

I too think Brian's point that moving forward the introduction of the next year's model would have been a better strategy to assist dealer stability while reducing the leftover problem. The idea that the 1953 production had to continue until the parts inventory was used up when the cars were so little changed for 1954 was especially absurd. The same was true for 1955-1956 when minor trim changes should have been done much earlier to keep the stock fresh rather than expect dealers take the hit for factory mismanagement.

Steve

Prudence
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Re: Cormorant #162 - "What Went Wrong"

Post by Prudence » Sat Feb 20, 2016 2:32 pm

For those of us who also play with Fords, we know that Henry almost never failed to use up parts left in his bin. Many folks who have Fords that are from the first of a new model run are surprised at what parts they find on some of the cars.

When Lee Iacocca first arrived at Chrysler, he found the same problem that Packard had in 1953/1955. Manufacturing was building cars with little or no knowledge of what was selling. Chrysler had to have a sale at the end of most months, according to Iacocca's Book. He quickly instituted a rule 'We don't build a car until we receive an order'.

It seems that it is better to build fewer cars and sell them for full price than build to many and sell them for little or no profit for the factory, dealer or sales force.

Ernie

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Tinman_70
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Re: Cormorant #162 - "What Went Wrong"

Post by Tinman_70 » Sun Feb 21, 2016 6:54 am

I found Brian's article very interesting. Certainly there were a number of issues, both internal and external, that lead to Packard's fall. From a business perspective, it appears that in the immediate post-WW2 era, Packard management shifted from a market-driven philosophy to one of production costs. As Robert Neal pointed out in his '48 to '50 book, styling took a back seat to cost savings. For instance, how many cars do we need to produce to recover the cost of new model tooling, rather than how many cars are we going to design and sell. This lead to the type of problems that Brain pointed out in later years, not the only problem but a pretty big one.
Last edited by Tinman_70 on Sun Feb 21, 2016 2:40 pm, edited 1 time in total.
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Prudence
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Re: Cormorant #162 - "What Went Wrong"

Post by Prudence » Sun Feb 21, 2016 11:09 am

I believe that Tinman has hit the nail on the head. Ernie ;)

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