Friday, March 31, 2017

Locomobile and auto racing
Part two - Locomobile fights for its life
In 1911 Locomobile introduced its model 48 which was manufactured through 1926 with few changes. Model 48 series numbers were used to differentiate the developments through the years. The '48' designation was used by the Locomobile Company to signify that the 475 cubic inch six-cylinder engine was rated by the NACC (National Automobile Chamber of Commerce) with 48 taxable horsepower. Through the years the Locomobile Model 48 built a solid reputation as a powerful, luxurious, reliable automobile for America’s upper class.
A postcard of the Locomobile factory

Locomobile fortunes changed radically in the summer of 1915. In July the company declared that its profits would be shared with the factory’s 3000 workers, then on September 1, company president Samuel T. Davis died unexpectedly from ptomaine poisoning.

The death of Davis, the son in-law of founder Amzi Barber left a vacuum in Locomobile’s leadership. Company treasurer Raymond Albright the son of one of Barber’s former business partners, took over but during the next few years while Locomobile built Liberty aircraft engines for the war effort Albright built up a stockpile of materials in anticipation of a huge post-World War One boom in automobile sales. 

The post-war nationwide economic recession and subsequent depression left Locomobile overextended and vulnerable. A month before the company entered the new decade, shareholders forced the Locomobile directors to sell out to the newly-formed Hare’s Motors Inc. a mysterious New Jersey “operating company” led by former Packard sales vice-president Emlen Spencer Hare.

The photo of Emlen Hare published
with his 1918 Horseless Age article

Emlen Hare formerly of the Commercial Truck Company of Philadelphia joined Packard Motor Car Company on January 1 1916 as a ‘Special Representative’ for commercial trucks in New York and headed the truck department after just six months.  In August 1916 he became the general manager for Packard in New York and before the year was out he was named the president of Packard’s New York branch.

In 1917 Emlen Hare wrote and published a booklet entitled Packard Salesmanship that pointed out good address, tact and thorough knowledge of the product and hard work were key, and his final tip was “never let him suspect that anything is too much trouble. He may be a bore but his order is not less valuable. Bores usually buy again once they are satisfied as few establishments satisfy them.”   

In that role in February 1918 Hare had penned a very strange article published in The Horseless Age, an automotive trade journal that claimed it was “a patriotic act to sell automobiles.” In his one-page opinion piece Hares drew a comparison between a “too-elaborate $6 dinner” to an automobile; he claimed the dinner “left one drained of energy with reduced efficiency for several days” whereas  the automobile “brings health and energy and thereby keeps judgement sound and is an insurance policy for what we have.”

Hare’s article also railed at the use of the term “pleasure car” to describe passenger cars which he said "are among our foremost time-savers.” Most curious was Hare’s use of President Woodrow Wilson as the proof for his argument in favor of automobiles.  Hare wrote that “to insure (sic) his judgement being normal, Wilson uses an automobile for mental and physical relaxation.” Wilson who in 1906 branded automobiles as “a picture of arrogance wealth” did not drive a automobile, rather he rode in a Pierce-Arrow limousine.  

In September 1918 Hare was elevated to the role of vice-president of Packard in Detroit but he left Packard in August 1919 with a new company Hare’s Motors Inc. created on October 6 1919 “backed by New York bankers” according to Motor Age.  Hare was named the company president with two other former Packard executives and his brother Alfred as vice-presidents. 
In October 1919, Hare’s Motors took over the operation of Mercer Motor Cars of Trenton New Jersey, a company which had suffered a sudden loss of its family leadership. In December as Mercer’s new president Hare revealed plans to immediately increase production to 3000 cars annually per the Automotive Trade Journal.   

In early 1920 after Hare’s Motors took control of Locomobile in a December 1919 deal that was leveraged with the issuance of 100,000 new shares of Mercer stock, former Locomobile treasurer Frank Hickman replaced Albright as the Locomobile company president.

Three former Packard executives – H.D. Church, Ormond E Hunt and Henry Lansdale, who had all resigned from Packard on November 1 1919 moved into respective management roles of engineering, production, and distribution at Locomobile. Hare’s Motors ceased Riker Trucks production in Bridgeport with the plan to build a new factory and in the meantime took over the operation of the Kelly-Springfield Motor Truck Company in Ohio.  

Author's photos of a Wright built Hispano-Suiza V8 aircraft engine
at the Western Antique Aeroplane and Automobile Museum

In January 1920 Hare’s Motors issued additional Locomobile and Mercer stock to finance the purchase of automobile manufacturer Crane-Simplex from aircraft manufacturer Wright-Martin Aircraft Corporation. Wright bought the company in 1916 to obtain Henry Crane’s license to build the Hispano-Suiza aircraft engines for the allied war effort. Wright did not build any of the luxurious Simplex six-cylinder cars after the stock of parts was used up and the Simplex automobile factory had sat idle for two years.

Hare’s Motors then controlled the manufacturing and sales operations for automobiles from Locomobile, Crane-Simplex and Mercer as well as Kelly-Springfield and Riker trucks (built by Locomobile) A full-page announcement published in the March 10 1920 edition of the Bridgeport Telegram newspaper under the unusual company motto of “We shall keep faith” which Emlen Hare explained meant “quality is the keystone.” stated that Hare’s Motors “assumes the directing power…to effect a big increase in output” and that “there shall be no waste in plant space or effort in any respect” as “management intends the Company shall succeed most by serving most.”

Later in March 1920, Hare gave an interview to the Automotive Trade Journal in which he anticipated “annual business of $250 million within five years” as Hare’s would produce a ”complete line including trucks.” Hare clarified that Locomobile Simplex and Mercer will retain their corporate identities with the plants operating purely as manufacturing establishment, with engineering, distribution maintenance and advertising removed and operated as divisions of Hare’s Motors Inc.” Almost without exception, the leaders of these departments announced by Hare were former Packard employees.

Hare first planned to introduce a car smaller than the Locomobile ‘48’ and intended to increase production at Mercer up to 50,000 cars per year.  Hare’s plans quickly went awry however, as the country went for a recession into a short intense depression. In October 1920 Hare announced a $1000 price cut for Mercer and $1350 for Locomobile.

In a convoluted statement Hare traced his company’s problems to “suppressed demand due to the insufficient purchasing power of the country due to the deflated value of the dollar.”  He claimed the price reduction was “part of a collaboration among manufacturers to restore the morale of business for temporary sacrifice,” and “that the ultimate profit is to be earned by taking a present loss.”

Many lower-cost cars such as Ford and mid-ranged priced car manufacturers that included Jordan and Maxwell cut their prices in the fall of 1920 but that the manufacturers of higher-priced cars such as DuPont, Nordyke & Marmon, Peerless, Packard and McFarlan stood pat while Pierce-Arrow actually raised prices. Automotive Industries noted in their October 7 1920 issue that “Hare has taken a stand in variance with most manufacturers of high-priced cars.”

In February 1921 The Magazine of Wall Street provided an advisory on Hare’s Motors which noted that “as result of the absorption of Locomobile, Simplex, and Kelly-Springfield, no statements of earnings have been made. Some time ago it was said of exchange of Hare’s Motors stock would be made but no announcements has been forthcoming. Probably the condition of the auto industry has caused a temporary delay in the consummation of that plan.”  Quite simply, Emlen S. Hare had grown his empire too fast, built up massive debt (over $6 million in new stock and bonds were issued to take over Locomobile) and now was overextended.       

In July 1921 The Commercial and Financial Chronicle reported that Hare’s Motors Inc. had sent stockholders a letter that stated in part “as a preliminary step to settle the difficulties of Hare’s Motors bank and creditors committees have worked out a plan for cancellation of all Mercer contracts and options with Hare’s Motors. In other words Mercer will be divorced from the Hares organization.”  Shortly thereafter, Henry Crane repurchased the assets of Crane-Simplex from Hare for pennies on the dollar. It is unclear whether any Simplex cars were built under Hare, but under Crane Simplex never resumed production. .

Hare’s Motors continued as the selling agent for Kelly-Springfield trucks as Locomobile’s future hung in the balance since Hare had used Mercer stock to finance the Locomobile purchase. The Commercial and Financial Chronicle reported that “bank and merchandise creditors of Locomobile are being asked for an extension of perhaps six months in the hope that some plan can be evolved for the reorganization of the company.” 

The creditor’s extension did last long as in September 1921, in a manner similar to Mercer Locomobile was “split off” from Hare’s Motors with attorney Elmer H. Havens named as the new Locomobile Company of America president. Following close behind was the entry of Kelly-Springfield Trucks into receivership.  Although Locomobile was free of Hare, the damage was done and In February 1922 Havens under pressure from creditors and stockholders allowed Locomobile to enter voluntary receivership despite the fact the company had $500,000 cash on hand.

The same day as the Locomobile receivership announcement, Hare’s Motors Inc. was reorganized as E.S. Hare Incorporated which would function “to assist auto manufacturers by straightening out their sales policies and taking over their distribution.”  In March 1922, Emlen Hare wrote a newspaper article entitled “Plans working out” in which he described his plans “in the not very distant future for the production of cars designed by a group of the ablest engineers ever assembled,” for which Hare claimed he “has experience and resources aplenty for the success of these plans.” 

Hare’s grand plans never worked out and soon after E.S. Hare Inc. publicly announced it had “retired from manufacturing to devote all its energies to merchandising.” E.S.Hare Inc. apparently failed soon after as in 1924 Emlen Hares was a vice-president with the Philadelphia investment firm of Hare & Chase Inc. a partnership controlled by his brother Alfred.

Over the next few years, under Emlen’s guidance Hare & Chase became a minor player in the relatively new field of new-car financing.   In 1936 Hare one of the new members of the Hupp Motor Car Company board of directors was named in federal lawsuits that were filed in connection with stock fraud and sales kick-back accusations against the notorious Hupp chairman and stock promoter Archie M. Andrews. The door for Andrews opened because before he took over Hupp, the company lost over $4 million each year in 1931 and 1932.

While Emlen S. Hare who noted automotive historian and author Beverley Rae Kimes called “one of automotive history’s more renowned scoundrels” can be blamed for contributing to the death three car companies- Locomobile, Mercer, and Simplex-Crane, his notoriety pales beside that of his associate Archie Andrews who killed four car companies – Hupp, Kissell, Ruxton, and Moon Motors. While Andrews died in 1938 while under indictment for bankruptcy fraud, Hare worked as an executive in the investment industry before passed away in 1962 at age 79.    

Locomobile had barely survived Emlen Hare’s failed empire building but sadly another empire-builder waited in the wings.

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