1. By DAVID N. BENSON
“To the U.S. man in the
street,” wrote Time magazine
in 1937, “the name Cord means
a low-slung automobile, rare
and swank, which is entirely
too expensive for him to own.”
Time was announcing
founder E.L. Cord’s sale of
Cord Corp., which that same
year would result in the clos-
ing of the Auburn Automobile
Co.
Suppose for a moment that
the Auburn Automobile Co.
didn’t go out of business in
1937 but somehow held on to
survive the Great Depression.
Might Auburn workers still
be turning out automobiles?
What challenges might the
company have faced in the
post-war era?
To find out, we put the ques-
tion to two experts on Stude-
baker: Patrick J. Furlong and
Loren Pennington. Furlong is
a professor of history at Indi-
ana University at South Bend.
Pennington is a retired histo-
ry professor at Emporia State
University in Kansas. Like his
father and grandfather before
him, he worked the production
line in South Bend.
Founded in 1852 as a wag-
on-making business, Stude-
baker boasted of being the
world’s largest vehicle man-
ufacturer by the 1890s. It en-
tered the automaking field
around the turn of the centu-
ry.
The South Bend company’s
experiences after 1937 could
show what hurdles an inde-
pendent, Indiana-based auto-
maker would have to cross.
But there are some import-
ant differences. Studebaker
was a much larger company.
In Auburn’s best year the com-
pany sold 34,000 cars. Stude-
baker routinely tripled that.
Studebaker went for the aver-
age car-buyer. Auburn catered
to the upper crust.
Studebaker’s efforts for the
mid-priced and low-priced car
market put it in direct compe-
tition with the powerful Big
Three automakers.
“Part of the reason Auburn
survived to the 1920s and ’30s
was that it wasn’t battling De-
troit,” said Gregg Buttermore,
the archivist for the Auburn
Cord Duesenberg museum.
“It was going for the upper
echelon of car buyer.”
Surviving bankruptcy
Here’s another similari-
ty. Studebaker went into re-
ceivership in March 1933. It
emerged as the only automo-
bile company to successfully
reorganize under the bank-
ruptcy laws.
“After 1933, Studebaker had
first-rate management and a
cooperative labor force. Every-
one realized that this was the
time to pull together,” Furlong
said.
At Auburn, the situation
was much different. The com-
pany suffered as president Roy
Faulkner quarreled with vice
president Harold Ames.
For instance, this year’s
ACD Festival theme car, the
1934 Auburn, was detested by
Ames, according to Butter-
more. Faulkner liked it, but
Ames was able to kill produc-
tion after only six months.
“That really hurt sales, be-
cause they only had a half
year’s production,” said But-
termore.
Had he intervened person-
ally, E.L. Cord might have
stopped the infighting, but he
had lost interest in the auto-
motive end of the business. In
1931, he relinquished the pres-
idency of the Auburn Automo-
bile Co., to head up his holding
company, Cord Corp.
Studebaker found its salva-
tion at the low end of the mar-
ket with its popular and inex-
pensive 1939 Champion model.
Auburn was stuck at the high
end.
“Auburn’s slogan was
‘above the mass class,’ which
was probably very tasteless,”
Buttermore said. “I think the
Depression finally caught up
to Auburn and took away the
audience, and I think the up-
per class began to think it was
in poor taste to drive an osten-
tatious big car.”
From a peak of 34,000 cars
in 1931, Auburn’s domestic
sales plummeted, to 11,300 in
1932 to 4,600 in 1933. Even the
rebound in sales in 1934, to
7,700 cars, was not enough to
save the company.
World War II
Make no mistake, World
War II would have been the sal-
vation of the Auburn Automo-
bile Co. Government contracts
fattened every automaker. The
single largest company was
General Motors with $8 bil-
lion in government contracts
during the war years.
Studebaker produced
Wright-Cyclone engines for
the B-17 bomber — and it
produced them more cheaply
than Curtis-Wright, the com-
pany that invented the en-
gine, said Pennington. Other
Studebaker projects included
army trucks and amphibious
vehicles. It produced so many
trucks for the Soviet Union
under the lend-lease program,
that Josef Stalin sent the com-
pany a thank-you letter.
It’s hard to imagine the Au-
burn Automobile Co. being
shut out of all that war work.
“All the automobile compa-
nies had large war contracts,”
said Furlong. “They were ide-
ally suited for producing vehi-
cle and aircraft engines.”
Given that, Cord Corp., the
holding company for the Au-
burn Automobile Co., would
have been ideally positioned.
Of Cord Corp.’s 60 companies,
about half a dozen concerned
What if Auburn’s auto company hadn’t gone under?
The survival of Studebaker until
the ’60s may provide an answer
From The Evening Star, Auburn, Indiana, Aug. 27, 1994, Page A8
Story begins on next page.

2. By DAVID N. BENSON
“To the U.S. man in the
street,” wrote Time magazine
in 1937, “the name Cord means
a low-slung automobile, rare
and swank, which is entirely
too expensive for him to own.”
Time was announcing
founder E.L. Cord’s sale of
Cord Corp., which that same
year would result in the clos-
ing of the Auburn Automobile
Co.
Suppose for a moment that
the Auburn Automobile Co.
didn’t go out of business in
1937 but somehow held on to
survive the Great Depression.
Might Auburn workers still
be turning out automobiles?
What challenges might the
company have faced in the
post-war era?
To find out, we put the ques-
tion to two experts on Stude-
baker: Patrick J. Furlong and
Loren Pennington. Furlong is
a professor of history at Indi-
ana University at South Bend.
Pennington is a retired histo-
ry professor at Emporia State
University in Kansas. Like his
father and grandfather before
him, he worked the production
line in South Bend.
Founded in 1852 as a wag-
on-making business, Stude-
baker boasted of being the
world’s largest vehicle man-
ufacturer by the 1890s. It en-
tered the automaking field
around the turn of the centu-
ry.
The South Bend company’s
experiences after 1937 could
show what hurdles an inde-
pendent, Indiana-based auto-
maker would have to cross.
But there are some import-
ant differences. Studebaker
was a much larger company.
In Auburn’s best year the com-
pany sold 34,000 cars. Stude-
baker routinely tripled that.
Studebaker went for the aver-
age car-buyer. Auburn catered
to the upper crust.
Studebaker’s efforts for the
mid-priced and low-priced car
market put it in direct compe-
tition with the powerful Big
Three automakers.
“Part of the reason Auburn
survived to the 1920s and ’30s
was that it wasn’t battling De-
troit,” said Gregg Buttermore,
the archivist for the Auburn
Cord Duesenberg museum.
“It was going for the upper
echelon of car buyer.”
Surviving bankruptcy
Here’s another similari-
ty. Studebaker went into re-
ceivership in March 1933. It
emerged as the only automo-
bile company to successfully
reorganize under the bank-
ruptcy laws.
“After 1933, Studebaker had
first-rate management and a
cooperative labor force. Every-
one realized that this was the
time to pull together,” Furlong
said.
At Auburn, the situation
was much different. The com-
pany suffered as president Roy
Faulkner quarreled with vice
president Harold Ames.
For instance, this year’s
ACD Festival theme car, the
1934 Auburn, was detested by
Ames, according to Butter-
more. Faulkner liked it, but
Ames was able to kill produc-
tion after only six months.
“That really hurt sales, be-
cause they only had a half
year’s production,” said But-
termore.
Had he intervened person-
ally, E.L. Cord might have
stopped the infighting, but he
had lost interest in the auto-
motive end of the business. In
1931, he relinquished the pres-
idency of the Auburn Automo-
bile Co., to head up his holding
company, Cord Corp.
Studebaker found its salva-
tion at the low end of the mar-
ket with its popular and inex-
pensive 1939 Champion model.
Auburn was stuck at the high
end.
“Auburn’s slogan was
‘above the mass class,’ which
was probably very tasteless,”
Buttermore said. “I think the
Depression finally caught up
to Auburn and took away the
audience, and I think the up-
per class began to think it was
in poor taste to drive an osten-
tatious big car.”
From a peak of 34,000 cars
in 1931, Auburn’s domestic
sales plummeted, to 11,300 in
1932 to 4,600 in 1933. Even the
rebound in sales in 1934, to
7,700 cars, was not enough to
save the company.
World War II
Make no mistake, World
War II would have been the sal-
vation of the Auburn Automo-
bile Co. Government contracts
fattened every automaker. The
single largest company was
General Motors with $8 bil-
lion in government contracts
during the war years.
Studebaker produced
Wright-Cyclone engines for
the B-17 bomber — and it
produced them more cheaply
than Curtis-Wright, the com-
pany that invented the en-
gine, said Pennington. Other
Studebaker projects included
army trucks and amphibious
vehicles. It produced so many
trucks for the Soviet Union
under the lend-lease program,
that Josef Stalin sent the com-
pany a thank-you letter.
It’s hard to imagine the Au-
burn Automobile Co. being
shut out of all that war work.
“All the automobile compa-
nies had large war contracts,”
said Furlong. “They were ide-
ally suited for producing vehi-
cle and aircraft engines.”
Given that, Cord Corp., the
holding company for the Au-
burn Automobile Co., would
have been ideally positioned.
Of Cord Corp.’s 60 companies,
about half a dozen concerned
What if Auburn’s auto company hadn’t gone under?
The survival of Studebaker until
the ’60s may provide an answer
From The Evening Star, Auburn, Indiana, Aug. 27, 1994, Page A8

3. aviation, including Stinson
Aircraft and Lycoming Manu-
facturing.
“When Cord sold Cord
Corp., the aviation companies
were doing very well,” Butter-
more said.
Through the 1950s
The immediate post-war pe-
riod would have been a bless-
ing. Since auto production had
been suspended since 1942,
Americans were hungry for
anything on wheels.
“Every car company in
America could sell anything it
made for about five years after
the war, and then customers
could get picky again. In 1947
you almost had to know a rel-
ative of the dealer just to get
a car,” Furlong said. “It was
just a case of too many people,
too much money and too few
cars.”
Pennington sees another
reason Auburn would have
enjoyed the early post-war
years. Every automobile com-
pany has a breakeven point,
the number of cars it must
sell to cover its costs. Once the
breakeven point is reached,
any car sold afterward is pure
profit.
In 1959, Studebaker’s best
year, the breakeven point was
100,000 cars. That year it sold
159,000 cars — and made $29
million. “That’s pretty impres-
sive when you realize those
last 59,000 cars represented
$29 million,” Pennington said.
Studebaker had to struggle
mightily in the 1950s to lower
its breakeven point. By being
small, Auburn would have had
to sell relatively fewer cars to
stay solvent.
“I have no doubt Auburn
would have made money until
1953 or 1954, had it survived
the Depression,” Pennington
said, although he added that
after that year, Auburn might
have struggled.
Those were the years Ford
and General Motors waged an
all-out war for market share,
he said. Neither side gained an
inch, but so many cars were
sold that the new-car market
was depressed for the next two
years. The aftermath certain-
ly had touched Studebaker. In
1956, the company was ready
for a federal bailout. The com-
pany folded its automaking op-
erations in 1963.
Annual model change
Another element to car de-
sign in the 1950s was the an-
nual model change. Furlong
said, “In those days we could
tell a 1956 Oldsmobile from a
1957 even on a dark and rainy
night,” he said.
Pronounced annual model
changes run up tooling and
engineering costs. The only
way the Big Three could keep
those costs from raising the
prices of their cars was by
spreading them out over hun-
dreds of thousands of models.
Given its limited produc-
tion, Auburn would have been
unable to keep up, Furlong
said.
Toward its final days, Au-
burn was already feeling the
pinch of new model costs.
Consider the last cars the com-
pany produced, the 1936 and
1937 Cord, designed by Gordon
Buehrig. Years later, he would
be invited to give lectures on
the design of his creations.
“Whenever he gave a pre-
sentation, he never failed to
mention that the company was
broke and he was being asked
to do the impossible with no
money,” Buttermore recalled.
Even to get a draftsman and
a clay model artist, he had to
beg. He got them only because
existing employees were avail-
able, Buttermore said. The
final product was based on a
1933 design for a Duesenberg
that was never produced.
Despite the masterstroke
of those final Cords, Auburn
would have been hard- pressed
to pull that rabbit out of the
hat again.
Thanks to everything from
the increasing complexity of
automobiles to increased fuel
and safety standards, the cost
of developing a new model of
automobile rose constantly.
After Studebaker merged
with Detroit automaker Pack-
ard, it fell to the South Bend
company to design the 1957
Packard. The cost was $1 mil-
lion.
“Can you imagine that?”
Pennington asked. “Today
you would need at least tens
of millions just to make minor
changes. It would cost hun-
dreds of millions to design a
new car.”
Dealing with dealers
Among Studebaker histo-
rians, the refrain is constant.
The problem with Studebaker
wasn’t that it couldn’t make
cars, it was that it couldn’t sell
them.
Pennington remembers an
interview he had with former
Studebaker president Harold
Churchill in the late 1960s.
“He turned to me and said,
‘What’s the most valuable auto
franchise in your town?” And I
said, ‘Chevrolet.’ ”
The president invited the
professor to continue down
the line: Next would be Ford,
then Pontiac-Olds-Cadillac,
and then Chrysler. And then
Churchill made his point.
“You see what I mean?” he
told Pennington. “By the time
you get to Studebaker, we get
the most underfinanced deal-
er in town. If the dealer’s any
good he would shift to the Big
Three at the first opportuni-
ty.”
Studebaker was forever re-
cruiting dealers, but its gains
seldom outnumbered its loss-
es. Studebaker’s worst year
might have been 1957 when
its dealers deserted in droves.
They became Edsel dealers.
“That’s jumping out of the fry-
ing pan and into the fire, but
it shows you what Studebaker
was up against,” Pennington
said.
To further frustrate the in-
dependents, the Big Three au-
tomakers kept their dealers
from handling other makes
of cars by inserting restric-
tive clauses in the contracts.
Studebaker challenged this
practice, winning a Supreme
Court decision in the 1950s,
but it didn’t do the troubled
company any good.
As Furlong points out, un-
derfinanced dealers are an
auto insurer’s worst night-
mare.
“Dealers carry the inven-
tory costs. They pay the man-
ufacturer the minute the cars
arrive on the lot. If a dealer is
not selling a lot of cars, he is
paying a lot of interest. If he’s
not financially sound, he can’t
keep too many cars on the lot,
probably doesn’t have a decent

4. repair garage, and the cus-
tomers go someplace else,” he
said.
In the early days of auto-
mobile dealerships, a dealer
was often a mechanic who had
very little money but wanted a
car to sell.
Very little information
survives on Auburn’s deal-
er network, Buttermore said.
The museum does not have
a complete listing of dealers.
Auburn did have large dealer-
ships in Chicago and Los An-
geles, Buttermore said. In the
smaller towns, Auburn deal-
ers handled other makes of
cars, he added.
Solidarity forever?
The years 1936 and 1937
were important for the fledg-
ling United Auto Workers. Sit-
down strikes took place at auto
plants in Cleveland, Anderson
and St. Louis, Kansas City and
Flint, Mich.
Many automakers resisted
the union. Ford didn’t orga-
nize until 1941. Studebaker
quietly accepted the United
Auto Workers and signed its
first contract in 1937.
But Auburn remained an
open shop until the very end.
In the early 1980s, the muse-
um conducted oral interviews
with surviving workers. Not a
single one of the 50 workers in-
terviewed admitted to hearing
any rumors of a union coming
in or about any clandestine
efforts to organize the plant,
Buttermore said.
But one retired Auburn
autoworker does remember
hearing a rumor about orga-
nizing the plant. Lester See,
now, 85, worked in the service
parts department.
“My brother-in-law worked
at production. And he once
told me somebody wanted a
union. They never got it. A
majority didn’t want a union,”
See said.
His brother-in-law is now
deceased, and See remembers
few details. He believes the
rumor would have made its
way around the plant in late
1934 or early 1935, before all
production was shifted to Con-
nersville.
A union wouldn’t have been
popular in the factory, See be-
lieves, even if Auburn’s pay
scale was below the industry
average.
“In my experience it was a
very good place to work. No
pressure, when something
needed to be done, it was
done.”
And Cord aside, Auburn
executives were popular and
accessible. See’s workplace
wasn’t far from August Duesen-
berg’s experimental shop.
“I once talked to Augie
Duesenberg, he was a very
nice man,” See said.
In the early days of the Unit-
ed Auto Workers, the union
lacked a grand design for or-
ganizing workers, said Mark
Crouch, associate professor of
labor studies at Indiana Uni-
versity-Purdue University at
Fort Wayne.
“Early on it was sponta-
neous,” he said. “Workers
themselves would say they
were fed up, then sit down and
call in the UAW. It wasn’t like
the UAW showed up outside
the gates and organized the
plant.”
Also, he said, the UAW expe-
rienced its greatest gains after
1936, in the twilight hours of
the Auburn Automobile Co.
But had the company sur-
vived the war, the arrival of
the United Autoworkers would
have been more or less inevita-
ble, Pennington believes.
“Auburn would have been
unionized because just about
every company that amounted
to anything was unionized,”
he said.
As the workers bargained
for better wages, they might
have increased the company’s
breakeven point, meaning
Auburn’s management could
afford to make even fewer mis-
takes.
“Part of the reason Stude-
baker closed when it did was to
avoid paying $80 million in un-
funded pension obligations,”
said Pennington, whose father
received a smaller pension be-
cause of it. “Closing was the
only way to get rid of all the
obligations of the union con-
tract.”
Auburn or Connersville?
Had Auburn the company
survived, how might Auburn
the city look? Furlong ­guesses
that Auburn would have more
jobs and the jobs would be rel-
atively high-paying. On the
downside, in boom times or
bust, Auburn economic for-
tunes would swing more vio-
lently than the national econ-
omy.
“When Studebaker was
South Bend’s largest employ-
er, South Bend’s unemploy-
ment rate was much lower
than the national average
when Studebaker was doing
well. When Studebaker was
not doing well, South Bend’s
unemployment rate was much
worse than the national aver-
age,” Furlong said.
Another question would be,
if Auburn the company sur-
vived, would Auburn the city
notice it?
In the 1920s, Cord purchased
82 acres in Connersville. Cord
invested in improving the four
buildings that came with the
site. After the renovations
were complete, Connersville
was a larger more modern
place than Auburn to build
automobiles. When the dete-
riorating economy forced the
company to scale back, it was
Auburn, not Connersville, that
felt the pinch.
“After 1933, the only cars
made in Auburn were over-
flow from Connersville, funer-
al cars, limousines, taxis and
experimental cars,” Butter-
more said.
“I can see a situation where
if Auburn survived, these
buildings (in Auburn) would
still be empty, and the compa-
ny would be in Connersville,”
he added.
What about the cars?
Dean Kruse, who has spent
much of the last quarter cen-
tury taking bids on Auburns,
Cords and Duesenbergs, be-
lieves had Auburn survived, it
would have been turning out
limited edition luxury cars,
homegrown Rolls-Royces.
That’s pretty much the view
of the Studebaker experts.
“I can see Auburn as the
smallest car company in the
United States trying to make
it. That collection of cars in
the museum is something else.
Those cars are something else,
Pennington said.
“If you can’t be big you
have to be different to make it
in the automobile business,”
Furlong said. “To survive,
the styling would have had
to have been beyond the ordi-
nary.”
So perhaps if Auburn were
in business today, the name
Cord might still strike the man
in the street as a low-slung au-
tomobile, rare and swank, and
entirely too expensive for him
to own.