The most significant postwar trend among independent automakers was a rush to compact cars. Between 1950 and 1953 four automakers came out with new entries. This would prove to be a double-edged sword.
On the one hand, this illustrated the value of the U.S. auto industry having a large amount of competition. Research conducted in the 1940s suggested that there was an emerging need for more efficient cars. (Foster, 2017). When the Big Three pulled the plug on their proposed entries, smaller automakers stepped in to fill the void.
On the other hand, the inability of three out of four compacts to survive beyond 1955 hinted at the dangers that independent automakers would face if they joined a product-proliferation arms race which would gain speed over the next few decades.
Nash was the first out of the gate with the 1950 Rambler. The next year Kaiser-Frazer introduced the Henry J. Then in 1952 Willys returned to passenger-car production with the Aero. Hudson was last to enter this field in 1953 with the Jet.
These cars reflected a much greater diversity of approaches than the U.S. auto industry would display two decades later, but the big question was whether the fledgling compact field could support so many entries. To add to the tenuousness of the enterprise, none of the cars shared a platform with a high-volume corporate sibling, so they would have to achieve adequate economies of scale on their own. That could be a tall task for an untested market niche.
Why did compacts die off like flies in the mid-50s?
The first two compacts — the Rambler and Henry J — got off to a fairly good start in 1951, together tallying almost 152,000 units. Alas, it was mostly downhill from there until 1958, when a recession began to shift buyer sentiment against bigger, glitzier and more powerful cars.
At a surface level, it would be reasonable to suggest that through the first half of the 1950s the compact market was not big enough to support four entries. However, that argument can obscure as much as it illuminates.
One reason why is that the size of the compact market may have been significantly impacted by a brutal price war between Ford and Chevrolet during 1953 and 1954. This occurred just as the postwar “seller’s market” was ending and a sharp recession shrank overall automobile sales (go here for further discussion).
From its peak in 1951, compact production dropped 62 percent to roughly 56,000 units in 1954. The more “normal” sales level was in 1952-53, when output hovered around 109,000 units. However, when split four ways that was only about 27,000 units for each entry, which was likely too low to generate a profit. To make matters worse, the compact market would contract further over the next four years.
I suspect that at least one additional compact entry could have survived if one or more of the above-mentioned factors had not been present. The reason why is that the price war, the end of the seller’s market and a recession functioned as a triple whammy so powerful that the very survival of each independent was threatened. Only Nash was strong enough to keep its Rambler in production.
In other words, under more “normal” conditions additional automakers may have been able to gradually grow a market for their compact even if it did not initially meet sales expectations.
As a case in point, there wasn’t nearly enough time to establish the Jet, which sold poorly enough that it is commonly viewed by historians as the final nail in the coffin of Hudson. Meanwhile, both the Henry J and the Willys Aero were discontinued in the U.S. after Kaiser-Frazer merged with Willys in 1953 and got out of passenger-car production by the end of 1955.
Each compact entry had meaningful weaknesses
Another factor that appears to have worked against the compacts is that they each had weaknesses that arguably undercut their viability. For example, the Nash Rambler may have benefitted from the strongest dealer network of the four, but the car’s inverted bathtub styling didn’t age nearly as well as the Willys Aero’s trim and pleasing proportions.
The Aero, in turn, was arguably the best-designed and engineered compact, but Willys would appear to have had the weakest dealer network. This was partly a function of being the smallest of the independents, but also because after World War II Willys was the slowest to get back into producing passenger cars.
It’s too bad that Hudson didn’t come out with a compact similar to the Aero because the Jet was arguably the least viable of the four entries. Richard M. Langworth called the Jet the “single greatest mistake the company ever made” (1993, p. 126). The car has been criticized for its overly tall and dumpy styling, excessive weight and high price.
Despite the Henry J’s strong initial sales, it saw the most dramatic fall as others entered the market. The most common criticism has been that Kaiser made the mistake of initially emphasizing stripped-down models, in contrast with Nash’s approach of only offering high-end models. Odd styling also didn’t help.
The Henry J was a decidedly basic car, but if it could have survived until the late-50s, it may have been the strongest competitor against a rising tide of imports because of its smaller size, lighter weight and standard four-cylinder engine. I also suspect that Kaiser’s increasingly shaky reputation may have tarnished the Henry J as much as any of the problems with the car itself.
No one fully tested the potential of compacts
A popular assumption about the early-50s compacts is that the public simply wasn’t ready for them yet. For example, a 1953 study by the Ford Motor Company concluded, “To the average American our present car and its size represent an outward symbol of prestige and well-being” (Nevins and Hill 1962; p. 379).
That may have been true to a degree, but the Rambler showed that even in the depths of the big-car craze in 1955, a compact wagon could be popular.
Also see ‘1933-42 Willys: A better template for an import beater than later compacts’
By the same token, I suspect that compacts didn’t sell as well as they could have because they mostly didn’t benefit from enough of a price advantage over the standard Ford, Chevrolet and Plymouth. The Henry J initially showed some promise, but it was produced by the wrong automaker. Nash might have had greater capacity to successfully sell at the bottom of the market.
Another factor to consider is that as the 1950s wore on, the Big Three effectively created more of a market for compacts by making its cars ever bigger. You can see that in market share data, where in 1955 compacts and imports together only comprised 1.9 percent of U.S. passenger-car registrations. By 1957 they had grown to 5 percent and then in 1959 soared to 20.3 percent (Edwards, 1965).
The tragedy is that updated versions of these four compacts could have plausibly helped to hold back a rising tide of imports in late-50s. This is why I think it was a big mistake that the federal government did not clamp down on the Ford-Chevy price war, which arguably violated anti-trust laws.
In the absence of government intervention, one of the more promising ideas was considered but rejected by Kaiser. That was for its compact to be a shortened version of its standard-sized car (Langworth, 1993). That could have given the automaker much better economies of scale (although probably not enough to compensate for Kaiser’s other problems). Imagine: Affordable product proliferation.
NOTES:
Production figures, market share and body specifications for individual nameplates were calculated from base data provided by the auto editors of Consumer Guide (2006), Edwards (1965), Flory (2009) and Gunnell (2002).
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RE:SOURCES
- Auto editors of Consumer Guide; 2006. Encyclopedia of American Cars. Publications International, Lincolnwood, Ill.
- Edwards, Charles E.; 1965. Dynamics of the United States Automobile Industry. University of South Carolina Press.
- Flory, J. “Kelly” Jr.; 2009. American Cars, 1946-1959: Every Model, Year by Year. McFarland & Co.
- Foster, Patrick R.; 2017. George Romney: An American Life. Waldorf Publishing, Grapevine, TX.
- Gunnell, John; 2002. Standard Catalog of American Cars, 1946-1975. Revised 4th Ed. Krause Publications, Iola, WI.
- Langworth, Richard M.; 1993. Hudson 1946-1957: The Classic Postwar Years. Motorbooks International, Osceola, WI.
- Nevins, Allan and Frank Ernest Hill; 1962. Ford: Decline and Rebirth 1933-1962. Charles Scribner’s Sons, New York, NY.
ADVERTISING & BROCHURES:
- oldcaradvertising.com: Hudson Jet (1953); Henry J (1951); Nash Rambler (1950); Willys Aero (1952)
- oldcarbrochures.org: Nash Rambler (1955)
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