ent001356-009

SECOND SECTION april is i%3 NewYorkWorld-Telegram STb* j&utt He?╟╓s a Born Fighter Egbert Is Swimming Upstream- Only Way for Studebaker to Go By CHARLES M. SIEVERT Only game fish swim up- sream, the old saying goes, and so Studebaker Corp., with its road ahead all uphill, is lucky to have young (42) Sherwood H. Egbert in the p r e s i d ent?╟╓s chair. ?╟úLook at my hair. Did you see any gray in it when you first met me two years ago??╟╓* It Was Egbert, in town for the International Auto Show, asking the question. We must admit that when Clarence Francis, chairman, invited him to take over as chief executive in February, 1961, this war- time U.S. Marine who ranged the Pacific hot spots had a woolly black top. Now the gray was beginning to prevail. The ups and downs in this company, founded by the Studebaker brothers in 1852 when they were making cov- ered wagons for breaking the West's frontier, have been many and scaring. Mergers be- fore the war (with Pierce Ar- row) and after (with Packard) haven?╟╓t helped. It went through reorganiza- tion (via Section 77B) in the ?╟╓30s, got a new lease on life postwar when car demand ex- ceeded the industry?╟╓s supply, but the competitive race since has been a struggle just to stay in the motor picture. When Egbert came to South Bend, the company?╟╓s main plan facility and headquar- ters, Studebaker?╟╓s prospects were dim indeed. The corpo- rate tally for ?╟╓61 showed an in- come loss of $3.1 million, but Sherwood H. Egbert a sale of its plastics division to Monsanto for $5.6 million gave it a net income of $2.5 mililon for the year. In his second year, however, he has fared better, earning $489,460 plus the sale and leaseback of its West Side service facility here for $2 mil- lion plus to give it a net in- come for ?╟╓62 of $2,561,794. Now in his third year, he feels the tide is turning but he?╟╓ll still be swimming up- stream. Studebaker has diver- sified to a large extent, used $26 mililon of its cash supply for acquisitions last year. It is in the diversification that Egbert expects to keep Studebaker afloat, broadening the market of its super- chargers, thermal plastics, household appliances, chemical compounds, tractors and floor machines to overseas and pen- etrating the European Com- mon Market. Its automotive operations at this time are a drain on its recovery, but nevertheless 1964 Continued on Following Page Charles Sieved Continued from preceding page model plans are proceeding apace. Egbert admits Stude- baker got off to a late start with its ?╟╓63 moels, including the Wagonaire, a station wag- on with fold-back top, and its sport Avanti in the $5000 bracket. Auto Share Down The company has less than one percent of the automotive market, even in this blossom- ing sales year when the indus- try expects to sell more than seven million units. In a clus- ter of postwar years, Stude- baker at one time had captured 5 percent of the market. So tough is the upward road in the automotive field that Egbert quite sensibly says he has no objective. ?╟úWe?╟╓ll do all we can in cars, trucks and sports models,?╟Ñ he says. Happily for Studebaker shareholders, he is a man who cant?╟╓ even spell discourage- ment. He has endless fight in him and this must date from his youth because he won 17 athletic letters in school days. A Spark From Lark He praises gushingly the co- operation of his board of direc- tors and then makes this ob- servation, bringing chairman Clarence Francis, 74, for years headman of thriving General Foods, into the focus of his operations: ?╟úHere we have a great combination. Experience and vision mixed with youth, vigor and energy to push our plans forward.?╟Ñ In the auto industry?╟╓s best year (19,55) Studebaker pro- duced 190,000 cars, then the slip- page set in, but in 1959 it got its second wind when compact cars suddenly came into favor and South Bend was pouring forth the Lark. It climbed back to 162,000 cars then, but as the Big Three brought forth their compacts, Studebaker?╟╓s grow- ing share shriveled. Last year, it produced 99,476 units, some 7000 better than in ?╟╓61. It will need a sales surge with its ?╟╓64 models this fall to cross the 100,000 mark, still not good enough to give it a profit flow. Studebaker?╟╓s big hope is to churn up sales in foreign mar- kets and Egbert says its early successes are encouraging abroad. It is opening a licensed operation in New Zealand. Seven assembly plants abroad have been blueprinted. Buys Italian Interest It has purchased 80 percent in Domowatt, Italian appliance manufacturer, where it will produce: the appliances of its Franklin and Schaefer divi- sions. Its iloor-fhushing equip- ment (Clarke division) is up 25 percent in export sales, be- ing used in many airports abroad. A healthy plus sign is the jump in government contracts. He said today his prediction of $100 million already has been surpassed since he took office. In South Bend, where Stude- baker accounts for a large block of employment, they know they have a fighter in Sherwood Egbert.