Threes And Sevens: 1933

It never ends…while we were washing my wonderful wife’s Corvette yesterday I discovered a screw embedded in the tread of the right front tire. Run-flat tires cannot be patched, at least they’re not supposed to be patched. After the new front tires are mounted today (you can’t replace just one front or rear tire), my wife will be out about $900, less than a week after her $600 expense to replace the windshield, which led to my sunburn. Every f*cking day…

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My decision to continue “Threes And Sevens” despite the lackluster number of views for the first post is primarily due to one reason: the “Big Five” commenters. They are photobyjohnbo/JS, Dirty Dingus McGee, Philip Maynard, David Banner (not his real name) and Mark. In particular, Dirty Dingus McGee and Mark genuinely seem to appreciate almost any automotive content I publish.

In the first post, I wrote that I would refrain from writing about events outside the US auto industry. Looking at 1933, though, makes me realize that is not a good idea. The automobile industry doesn’t exist in a vacuum and can be both cause and effect for events in other parts of the economy and country.

Although total US car production increased in 1933 by about 26 percent compared to 1932, the latter was the absolute trough in production during something called the Great Depression (yes, a poor attempt at sarcasm). Production for 1933 was less than half of that from just five years earlier and basically was equal to US production from 1916.

US GDP declined by 8.5% in 1930 compared to 1929, declined another 6.4% in 1931, by 12.9% in 1932 and, just for good measure, by 1.2% in 1933. Real US GDP declined a total of 26.3% from 1929 to 1933, inclusive. As a comparison, real US GDP declined by 2.7% from 2007 to 2009 during the Economic Crisis or “Great Recession.”

Only four US makes reached the six-figure mark in production in 1933: Chevrolet, Ford, Plymouth and Dodge; those makes accounted for more than 80% of US sales. In 1928, every brand that made the top eight easily exceeded the 100,000 figure. The best-selling US car model was the Chevrolet Eagle 5-passenger coach at about 163,000 units, just surpassing the Eagle 5-passenger sedan at 162,000. Ford’s best seller was the V-8 Tudor 5-passenger sedan at about 106,000 cars.

Trying to find a photo of the best-selling US car for 1933 is not as easy as one might think. Many photos of 1933 Chevrolets are of highly modified cars. Here is the best I can do; this photo is from standard catalog of® American Cars 1805-1942:

 

 

Yes, I know this is labeled as the sedan and not the coach. I couldn’t find a picture of an unmodified coach. So sue me…

By the way, according to Encyclopedia of American Cars by the Auto Editors of Consumer Guide®, the Master (and accompanying Standard) line was not named as such until 1934. That book says that Chevrolet’s two lines of cars for 1933 were called Eagle and Mercury. Like I keep writing, record-keeping has been poor for most of human history.

Elsewhere in the US auto industry in 1933:

Studebaker was forced into receivership. Although company president Albert Erskine made mistakes, including continuing to pay outsized dividends despite sharply declining profits, the proximal cause of the company’s bankruptcy was the surprise national “Bank Holiday” declared by Franklin Delano Roosevelt days after his first inauguration. Erskine was about to execute a purchase of Ohio-based White Motor Company. The acquisition would have given Studebaker a solid position in the truck segment and given it access to White’s decent level of cash reserves.

An effort by a minority of White shareholders to scuttle the deal led to just enough delay for the whole thing to be squashed by the surprise national bank closure, which led many companies–not just Studebaker–to suspend or to end operations due to lack of operating capital. Studebaker, which had actually shown a profit for 1929, 1930 and 1931 and whose market share had increased by more than 70 percent since 1929, was placed in receivership on March 18, 1933.

Erskine resigned the next day and, deeply in debt and in poor health but carrying life insurance policies worth $900,000 that did not include a suicide clause, committed suicide on July 1. Some automotive historians think Studebaker’s eventual end as an automobile company was inevitable after the events of 1933.

 

Studebaker had acquired Pierce-Arrow, manufacturer of luxury cars, in 1928–not great timing as it turned out. In August of 1933, Pierce-Arrow was sold to a group of investment bankers. The company would finally succumb to the Great Depression in 1938, but not before producing this magnificent car in 1933:

 

See the source image

 

This is the famous 1933 Pierce-Arrow Silver Arrow, advertised as “in 1933 the car of 1940.” Five were built and one paced the Indianapolis 500.

The other half of what would eventually be the Studebaker-Packard Corporation also had difficult times in 1933. Packard sales were just under 10,000, compared to almost 50,000 in 1928. By 1937, however, sales had exploded to more than 109,000, due in large part to the company moving “downmarket” with the introduction of the One Twenty in 1935 and the Six in 1936. Many automotive historians think these moves also led to the eventual downfall of Packard as it was unable/unwilling to re-focus on being a luxury make after World War II.

In 1933, General Motors President Alfred Sloan combined Chevrolet and Pontiac manufacturing to cut costs. He also merged Buick, Oldsmobile and Pontiac sales divisions forcing relevant dealers to sell all three makes.

Plymouth’s 1933 sales surge that pushed it to close behind Ford was due in large part to using a six-cylinder engine as standard equipment instead of the four-cylinder motor it had previously used. Plymouth sales increased by 60% in 1933 compared to 1932.

 

https://ccmarketplace.azureedge.net/cc-temp/listing/102/652/9504417-1933-plymouth-sedan-std.jpg

 

Hopefully, the photo above is a 1933 Plymouth.

I have written enough today about 1933. PLEASE feel free to give feedback on Threes And Sevens. Thanks.

 

#ThreesAndSevens

#1933

#somanyCARSjustonelife

#disaffectedmusings

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8 thoughts on “Threes And Sevens: 1933

  1. Once again, some mighty fine research.

    Studebakers problems DID indeed start with the acquisition of Pierce Arrow, and seemed to spiral downward forever after. Whether the result of poor management, bad luck and or timing, there were only a few times in the next 35 years that they had the right product at the right time. Those would mainly be the “Loewy coupe” and the 59 introduction of the Lark. Even their “halo cars”, 56-58 Golden Hawk and 63-64 Avanti were not players in the market.

    But contrary to popular folklore, Studebaker did NOT cease to exist as a company, they just ceased the manufacture of cars. They had many other subsidiaries; I even have an Onan generator, made in the early 60’s and bought new by my grandfather, which was owned by Studebaker.

    Sucks about the screwing y’all got on the tire (see what I did there? 🙂 ). About 3 weeks ago I had to put new fronts on my longroof Belvedere. Car beside me hit some road debris, knocked it in front of me and I hit it. Put a big cut in the tread of the left front, but worse whacked my rocker panel leaving a big ole dent. Got the tires replaced, $350, and sometime soon will work on the dent. So yes, it never ends.

    Some days you’re the windshield, some days the bug.

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    1. Thanks again, DDM. I don’t remember what it’s like to be the windshield.

      Erskine made mistakes other than the Pierce-Arrow purchase. As an independent carmaker, Studebaker also had far less margin for error than a member of The Big Three. I don’t want to include a long quote in a comment, but Richard Langworth’s excellent book about the last 20 years Studebaker manufactured cars contains a reference to the Avanti and how that story almost certainly would have turned out differently if Chevrolet, for example, had introduced the car.

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  2. Please keep up your Threes and Sevens series. I am not normally a numbers maven; however, I find your research very interesting. The various details and stories about the unknown side of the auto industry help me understand the “why” of how we got here with this industry.

    My drop in site visits is not due to your content, just us having to deal with various personal issues.

    Tires and windshields are the usual victims of Arizona’s road debris. When looking for tires and other expensive items in Arizona, find the area, town, city with the lowest transaction privilege tax, i.e. “sales tax”. Do not use a zip code search as a single zip code can overlap several tax zones. Your best bet is a retailer outside of a city limit where only the state and county sales tax rates would apply. As with any situation dealing with a taxing authority, know the rules and then play by the rules. The tires and wheels I bought for my truck project were bought from a tire retailer located in the lowest sales tax area in the Tucson area, which saved me 2.6%.

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  3. Bad luck on that tire mishap.
    I enjoy the read of the early history (pre-WWII) of the automobile industry that you present. I am not that familiar. In my absence of blog reading for the last couple of weeks, I know I’ve missed some interesting posts. I shall go back and catch up on what I’ve missed.

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    1. Thanks, JS.

      “Bad luck on that tire mishap.” During one of our bi-annual meetings with our broker (he’s really our broker in name only as I make and execute investment decisions) he asked me if I was a glass half-full or glass half-empty type of person. I told him, “I don’t even see the glass.” He laughed for a long time, but my reply indicates that for too much of the time I don’t even think I’m on the scale for fortune.

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  4. Tires are really a thing sometimes. I’ve had my ’13 Fusion for about 3.5 yrs, and have had on/off problems with the Nexen tires (which were on the car when I bought it). I discovered a torn bead which protruded from the rim but did not lose air, and had it replaced a few years ago. Another periodically lost air, but seems to have stopped in the past few months. Unfortunately, about 2 weeks ago I noticed the passenger rear was fairly flat, so I got out my compressor. Well, it wouldn’t gain any air pressure. Took the car to a local shop… tire badly worn (to the cord in some places, though tread was ok in other places), bad wheel bearing, and rear brake pads and rotors were needing replaced. Total bill, $865.

    I have not studied the Great Depression in-depth, but I do notice something when I read about car manufacture during those years. I think that generally, most people see the period as just steady economic ruin from 1929-1939, until war production started to ramp up. But looking at auto production, you see that it drops sharply 1930 to 1931, continues to drop in 1932, then begins a slow climb to 1936 and 1937, where Ford built 900,000+ vehicles each year and 8 automakers make 100,000+ vehicles, before crashing again in 1938. Granted it’s not a rosy picture but, someone had to be purchasing these vehicles, even if prices were dropped someone had to be making ends meet.

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    1. Many thanks, Mark. Some people take their tires for granted until it’s too late. Sometimes, tires just fail.

      Will Rogers said, “America will be the first country in history to go to the poorhouse in an automobile.” By 1929, 80 percent of American households owned at least one car and the automobile was an integral part of American life, to say the least. The Great Depression wasn’t continuous ruin, but US nominal GDP was actually lower in 1939 than 1929. However, real GDP was slightly higher meaning, of course, that prices had actually declined over that 10-year period.

      Liked by 1 person

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