Business: All’s Right in South Bend

South Bend, Ind. last week was in the throes of one of the worst winters in its history, yet hardly anyone talked about the weather. “With all these Larks around,” said Studebaker-Packard’s President Harold E. Churchill, “it’s been like spring.” Production of the Lark was up to 4,300 cars a week; total production for 1959 so far (61,000) was 12,000 ahead of the entire 1958 model year.

Some Said Die. South Bend, as well as Studebaker, has made a comeback with the Lark. Through most of 1958, the city and surrounding St. Joseph County constituted a “critical” unemployment area. As sales and production grew steadily smaller, the layoffs mounted, until by March barely 4,700 workers had jobs at the plant. Along with recession slowdowns at other big companies—Bendix Products Division, U.S. Rubber, Curtiss-Wright—the cutbacks pushed total county unemployment to a record 15,900—more than 16% of the labor force. Lines started forming on Lafayette Street for handouts of surplus Government beans, rice and butter. At one point the city’s Council of Community Services reported 3,788 hardship cases per month, and people could be heard wishing that Studebaker would go under once and for all. Says a Chamber of Commerce official: “A minority wanted Studebaker to die, so we could take a fresh look at our future. But most people thought if we lose Studey, South Bend will be in real trouble.”

That Studey did not die is due to a hard battle, well fought by both company and community. Almost from the moment he took over in mid-1956, President Churchill, who made his mark as Studebaker’s top research engineer, realized that the company’s salvation lay in scrapping its big-car line for a single, easy-to-build, low-priced small car that did not have to compete on the Big Three’s terms. In January 1958, Churchill gathered his top executives and put the question to them; at the end of the less than two hour meeting, the decision was made.

From then on, because Studebaker is a small company, Churchill often worked in the same room with his development team, consisting of five designers and 16 engineers. The trick was to do the job on a shoestring. The team found a way to revamp the dies from last year’s models, use them to stamp the new car’s sheet metal; all parts were bolted together instead of expensively welded; front and rear bumpers were made identical; the front sheet metal assembly was reduced to six pieces. In seven months the Lark was ready. Total development cost: less than $3,000,000, v. an estimated $150 million for the 1959 Ford.

Most Said Buy. Even before word got around of S.-P.’s gamble to survive, South Bend had decided to do what it could to help the company. A group started a “Citizens for Studebaker” committee, toured the area soliciting pledges to buy a new 1959 Studebaker, issued 60,000 stickers and 10,000 buttons promoting the Lark, wrote’ letters, gave speeches, finally staged a huge parade depicting the company history from Studebaker’s first Conestoga wagon in 1852 to the present. The county A.F.L.-C.I.O. council mailed 14,000 letters across the U.S. pushing the Lark. Along South Bend streets, every third street lamp was plastered with:

SOUTH BEND GOES UP WITH THE LARK.

Notre Dame’s glee club sang songs about the Lark, and in the First Methodist Church one Sunday, the Rev. Kenneth R. Hemphill sermonized on Jeremiah, 32nd Chapter, 15th verse: “Houses and fields and vineyards shall again be bought and sold in this land.” and substituted “Studebakers” for “vineyards.”

Last week, both company and community could be pleased with their efforts. With 10,800 men working (8.000 of them on overtime), Harold Churchill, who originally predicted a 15% slice of the auto market for small cars when the Lark first came out, now thought that “my estimate was on the conservative side.” Studebaker has visions of 150.000 cars this year. In St. Joseph County, where 35% of all new-car registrations last January were Larks, unemployment is down more than half—to less than 6.4% of the work force —and the area is no longer rated critical. The bread lines are almost gone; business is good. And in South Bend, the citizens like to quote Robert Browning:

The lark’s on the wing, The snail’s on the thorn: God’s in his Heaven—All’s right with the world!