Automotive History: 1957-1958 Studebaker Scotsman: Discount Life Preserver

(first posted 11/8/2011)  We have spent a lot of effort debating the merits (and demerits) of economy cars on these pages. We have spent no small amount of time examining products that were designed to appeal to the most frugal among us. To be sure, lots of makes have tried different approaches to win the business of the miserly. For example, how Yugo baited their trap with an unrealistically low price to lure in the unwary customer that just looked at the initial cost of purchase. There was also the sad tale of the first movers in the compact car market that actually priced their products above the mainstream offerings of the day. They came to grief when buyers did the math of ownership and realized that these cars were no bargain. But there was one manufacturer that tried another approach and found a season of success by turning the value equation upside down. That company was Studebaker. The car was the Scotsman.

By 1957, Studebaker was no stranger to the idea of an economy car. In fact, it could be argued that the company had pioneered the concept with its Champion model of 1939. The Champion was a full size car (by the standards of the day) that sold for less than the full size offerings from Ford, GM and Chrysler while returning outstanding fuel economy and rugged dependability. The secret of the Champion was radical weight reduction (as much as 600 pounds) and a thrifty straight six that could return low 30’s mileage in the hands of a careful driver. The Champion was the right car for the late depression years – inexpensive to buy, inexpensive to own.

Studebaker never tried to field a true compact car during the first wave of such offerings in the early 1950’s. The company stuck with the Champion formula of full size car/ small six engine and sales remained steady with no risky outlay of scarce company funds to field a car for an unproven market niche. This strategy was the correct one. The boffins in South Bend watched the market pioneers come and go in a sea of red ink while their low cost competitor could share lots of components with its big brothers, all the time retaining its carefully nurtured identity as a value purchase. This cost sharing enabled the company to price the Champion competitively with the lower rung of the Big 3’s offerings while enabling the company to record a modest, but steady, per unit profit.

But several factors began to trespass on the carefully crafted turf that Studebaker tried to maintain. The first was internal. The company’s purchase by Packard in 1952 meant that henceforth, the return on investment for all models would have to ensure that those models could justify the resources expended in their manufacture.  The Champion line was important (Packard fielded no entry level car), in the new corporate structure, but needed to show a profit in order to enable the company to survive.

But the other factor that put the squeeze on Studebaker-Packard was the attritional price war that the Biggest Two waged against one another beginning in 1953-54. Fords and Chevys were being sold at near cost in order for their parent companies to capture market share. Unordered cars began to flood dealers lots as the two bitter rivals sought to damage each other and establish market supremacy. In our own day, this would be called “channel stuffing” and the results were not slow in coming: the only companies hurt in the great price war were the independents. And if profits were hard to come by in the sweet spot of the market, in the price leader segment they were microscopic.

After the great sellers market of 1955-56 passed S-P by, and losses began to put the company in peril,  S-P  cast about for a new model that would generate some  volume. The company desperately needed to keep the doors open long enough to develop a new generation of vehicles that would replace the new- for- 1953 bodyshell. By this point, Raymond Loewy’s design was looking really old hat. S-P needed a niche that could be conquered and defended. Given the lack of working capital, management began to cast about for something, anything , that would give them a unique model that could be developed for pocket change.

The answer was already rolling off of the company’s assembly lines. In order to compete with the painfully spare Chevy One Fifty and Ford Custom series (and to a lesser extent the growing number of economy imports like the Beetle) the brass at Studebaker started to de-content the 1956 Champion (above) down to a price that  would make it the industry’s value leader.

The car that would emerge from these efforts in mid 1957 would re-define what it meant to be a stripper. In that pre-politically correct era, the name “Scotsman” was no stereotypical pejorative. It connoted a frugal, thrifty demeanor that S-P wanted to attach to its new offering. Officially, the car would be part of the Champion line, but the Scotsman would be a sub series that company management hoped would draw in enough business to spread their dangerously high costs across a larger production run.

If the Scotsman reminded buyers of anything, it was the “blackout” cars of the war shortened 1942 model year. The exterior advertised its owners penuriousness with such styling  compromises as painted grille, hubcaps and (if the buyer deleted for credit)a painted bumper in place of chrome. The interior also reeked of cheap,with broad sweeping vistas of painted metal, cheap vinyl seats and painted cardboard panels providing the driving ambiance. Other cost cutting gimmicks included vacuum powered windshield wipers, no radio, and the drivers side sunvisor as strictly optional. Studebakers excellent “Climatizer” heating system was even omitted in favor of a cheap unit that  kinda, sorta heated a little bit of incoming air. (In this,  Beetle owners , at least, could sympathize). The rear windows were fixed in place.

The drivetrain was likewise an accountants dream. The hoary old 101 HP sidevalve six cylinder mill that had been installed in the original Champion of 1939 was the only engine choice. With a three on the tree transmission (the only one on offer), zero to sixty could linger on for over 20 agonizing seconds. Brakes were the standard four wheel drums with no power assist.  To simplify the lineup, just three models were in the catalog. Buyers could choose from a two or four sedan or two door wagon. Prices started at a stunningly low (and patriotic) $1776.

While all of this sounds like Studebaker was tacking against the prevailing winds in the industry, somehow, it worked. This despite longer, lower, wider (and flashier) being the reality in Detroit. A business case projection told Studebaker to expect a sales figure of around 4,000 in the initial half year production run. When dealers ordered and sold just over 9,000, Studie management knew that they were on to something. The line was promptly renewed for 1958.

Studebaker tried what would now be termed “line extensions” to squeeze more sales out of the Scotsman brand. The company tried to drum up fleet sales by introducing the Econ-o-miler series as a taxicab or (in two door wagon guise) as a flower or light delivery car.

Studebaker also made the car available for postal duty.The name was attached to a price leader pickup. Cops were sometimes issued Scotsman sedans with a President 289 V-8 installed on special order. Cars so equipped could catch an astonished (and embarrassed) speeder without too much trouble.

For ’58, the Scotsman kept the previous years twin headlamp treatment (another cost saving) and eschewed the concurrent Champions (above) new tacked on tailfins. Prices got only a slight bump, with a starting MSRP that was still shy of $1800. The result was another banner year for the value leader, with sales higher than any other series in the Studebaker lineup. In fact, the Scotsman line outsold all other Studebaker models combined in what would come to be called the year of the “Eisenhower Recession”. Just under 21,000 cars were retailed in the Scotsman line that year.

That short, sharp economic downturn, combined with the success of the Rambler and the imports,  formed the basis of much of Detroit’s near term thinking. Plans to market a compact, economy car were rushed to completion at Ford and GM. The market that Studebaker had uncovered with the Scotsman would be fully exploited by its larger competitors within a single design cycle.

But the one thing that the Scotsman had done was buy the time that Studebaker needed to develop the car that would allow the company to live and fight another day. In the early autumn of 1958, the Scotsman was eased out of production to make way for the model that would carry the company to the end of its days. A clever disguise of the same donor car as the Scotsman, the new model was also developed on a relative shoestring.  That car would be the company’s last sales success. It would be called the Lark.