The years 1956-1959 were extremely ugly for US mid-priced brands, their collective market share dropping by 37%. The recession of 1957-1958 is often credited with this drop, but that’s far from the full story. That recession started in mid-1957, affecting 1958 MY sales. But as this chart shows, the downward trend started in MY 1956 and had its steepest drop during MY 1957, before the recession started. There were even bigger factors at work, or perhaps we should we say more compact factors.
I’ve been reading a lot of old Motor Trends from the 1950s, and there’s numerous editorials that confirm what I had already known. There was a large cultural change at work; in the first half of the ’50s Americans had seen large mid-price brand cars as aspirational, something that would buy them status and prestige. But that changed starting in about 1955, and Americans suddenly embraced imports, compacts and lower-priced brands. The status from ever-larger and chromier and more expensive cars turned out to be illusionary; in fact, imports and compacts suddenly conveyed even greater prestige as they were seen as smart and fashionable, especially by the better educated and more affluent, who were as usual the trend-setters. Large American cars were suddenly seen as too big and with excessive chrome, ornamentation, fins and other affectations.
It should be pointed out that in the 1950s, the majority of new cars were bought by white collar professionals and such, and that the typical blue collar worker bought used cars. This helps explain the rapid shift that took place, as better educated and more affluent white collar workers were (are) typically more open to new cultural trends, which in autos meant imports and compacts. Ive documented this shift more thoroughly in my article “Who Killed The Big American Car?”.
The bottom of the trough was 1959, which happened to corresponded with the all-time excesses of fins and such.
This cultural phenomena was well documented in the media at the time. It was reflected in the explosion of sales for VW and other imports as well as Rambler (and Studebaker, in 1959) and the Big Three compacts of 1960. This phase ended in 1961-1962, with medium price brands and large (but not nearly as excessively finned and chromed) cars improved their market share, although the gains for large cars the would only be temporary before they resumed their terminal decline in market share.
But medium priced brands would come to dominate the domestic market in the ’70s, but with their mid-sized and smaller sized cars. This reflects a key change that started with the imports in the ’50s and the 1960.5 Corvair Monza: what buyers really wanted was well-trimmed but also trim cars. The mid priced brands offered just that in the years to come, as in the repeat best seller Olds Cutlass coupe.
Related reading:
Automotive History: Who Killed the Big American Car?
Another factor: Starting in ’57 the low-priced three grew and luxuriated until they matched the previous Olds size. The biggest cars couldn’t grow in parallel because they were already up against hard limits imposed by garages and parking lots. So there was much less reason to prefer the mid-priced.
Combined market share for Chevy, Ford and Plymouth:
1955: 53.7%
1959: 54.1%
There was some increase for them in 1957, but it was short lived. it seems buyers weren’t too keen on those larger ’57s. For that matter, Chrysler’s ’57s weren’t really any longer than the ’56s. Just lower.
One factor that was putting the squeeze on mid-priced brands was the increasing poshness of entry-level cars – you could kit out your Chevy with a V8, A/C, power accessories, and upscale trim, so who needed a Buick? Even more so starting in 1965 with the Caprice and LTD, and again a decade later with smaller cars like the Granada. Still, mid-priced cars were popular into the 1980s especially at GM. Certain imports, like Volvo, Saab, and Peugeot I’d also categorize as mid-priced. It’s hard to tell though whether there was truly less room for midrange brands from the ’90s onward, or if the brands that filled the segment faltered due to poor designs and marketing. Clearly Oldsmobile had some unappealing designs and image problems towards the end, and Mercurys were inadequately distinguished from Fords. Today you can cover the mainstream market with just two brands, like Toyota/Lexus or VW/Audi. Perhaps the most successful current mid-priced brand is GMC; combined sales of Chevrolet and GMC full-size trucks outsell Ford’s F-150, so a case could be made there’s still a place for mid-priced brands if well executed.
It would look steeper I think if you were somehow able to include the Packard Clipper, which accounted for perhaps 40,000 units in 1955 and nothing by 1958, as well as what was left-over from Hudson, Nash, and Kaiser.
True. I kept it simple. Maybe another time for a deeper dive.
The “untold story” here is the flight to GM. GM’s overall market share increased in the late ’50s/ early ’60s at the expense of others. Pontiac went from 215K in ’58 to 381K in ’59. Oldsmobile went from 296K to 382K. Competing mid-priced makes recovered just slightly from ’58 to ’59, and Edsel and DeSoto dropped.
Meanwhile, Chevrolet banged out 1.4M cars in ’59, up from 1.2M in ’58, and Cadillac sales were up 16% over ’58. All of GM’s 1960 models did as good or even better.
So then GM’s longer-lower-wider-finnier models of 59-60 (designed as a crash program to out-do Exner’s Forward Look wonders of 1957) were a success, no?
Looks my long comment reply got eaten this morning.
Production/sales numbers do not tell the full story by far, as the total market fluctuated strongly. Market share is a better indicator of the preferences of the buyers. As a matter of fact, all of GM;’s divisions except for Pontiac had market share declines in 1959 from 1958. And Ford beat Chevy. So it’s seem pretty fair to say that the market did not respond positively to GM’s ’59 designs.
The short answer is: no.
My gut says that the key here is family needs. By the late 1950s, the first wave of Boomers are now school kids while their parents were still birthing the second wave of Boomers. Parents who served in WWII/Korea need family cars and a second car. The family cars are wagons and sedans, and the second cars are used or small imports.
By 1960, the first wave of Boomers are starting to drive, their parents are becoming empty nesters, and the second wave of Boomers is entering school. Moms who worked during WWII, returned to work after their first wave Boomers were in High School, and they preferred compact cars and imports, replacing the used car as the second family car in the market.
Larger families were still driving wagons and sedans and due to budgetary reasons, switched from aspirational brands to lower priced Chevy, Ford, Plymouth and Rambler.
By 1965, first wave Boomers were driving and the Pony and Muscle car market booms. Families with kids are buying LTD and Caprice as the Brougham Era begins. The need for the large budget wagons continues to dry up for Rambler after 1965.
The Brougham Era has two generations buying into it – Empty Nesters who no longer need a full size rides, and first generation Boomers who have two, one or no children. Aspirational brands bounced back with Cutlass, Cougar, Cordoba and Monte Carlo meeting this demand that peaks by 1980.
After 1980, both first and second wave Boomers either have, or are having, children in time for the Chrysler Mini Van Boom. First wave Boomers have high schoolers and second generation Boomers are still making families until 1990.
The “second car” market goes from basic compact cars in 1960, to Subcompacts in 1970, and is joined by second wave Boomers with X generation right through to 1990 when the Ford Explorer SUV boom occurs.
So, breaking down the market by brand is missing some of the realities of life’s demands on where you live, what you own, and what you drive, in my opinion. The rise and fall of the large automobile, is in my opinion, strongly impacted by the rise and fall of the first wave of Baby Boomers 1944-1955, and second wave 1955-1965. The generation impacted every facet of post WWII American housing and consumption growth and change, including the automobile.
Remember that by 1965 40% of US women between the ages of 18-49 were on The Pill. This had a direct impact on the size of the second wave of Boomers and the X generation. Consequently, there is a reduced demand for large family vehicles at this time as well. (Today the percentage is 14%)
I’m not getting your line of thinking. US family size didn’t fluctuate that much; it peaked in 1965, and then dropped only very mildly. These very small fluctuations do not explain a 37% drop in mid-price brands from 1955-1959.
A family of 3.7 could quite as well ride in a compact as well as in a Buick.
Following is the average family size in the United States for selected years since 1940: 1987, 3.19; 1986, 3.21; 1985, 3.23; 1980, 3.29; 1975 3.42; 1970, 3.58; 1965, 3.70; 1960, 3.67; 1955, 3.59; 1950, 3.54; 1940 3.76
Whats the post 1990 trajectory of this in your opinion?
It appears that Oldsmobile fared best of the mid-priced brands from 1957 to 1959, despite their rather gaudy design for 1958, likely attributable to a reputation as the, or one of the, best built cars at the time largely due to the spirit and dedication of the Lansing workers.
Oldsmobile and Pontiac were the only Big Three medium-price marques that didn’t experience serious build quality and reliability issues at some point during 1955-57.
This graph does explain why Edsel and DeSoto needed to be done with. For 1959 into 1960 they became essentially rounding errors in overall car sales for Ford and Chrysler.
For my dad and uncle, two young engineers, each with one child, in ’55 it was a new low trim Pontiac and Buick respectively. By ’59 both families had grown, and there was a new Chevy wagon in each driveway.
One thing that doesn’t reflect in that market share chart, is that what constituted those “middle priced” brands in 1964 was notably different from, say, 1955-59. With the exception of the Coronet, and Edsel in 1959, those middle-priced cars were all V8 powered, and full-sized, and a bit further up the food chain in price.
But then in 1960, Dodge came out with the Plymouth sized (and priced) Dart lineup. Mercury launched the Comet. DeSoto crept down a bit in price as it pared its model lineup. For 1961, Mercury pretty much gave up on competing with the likes of DeSoto, Chrysler, Olds, and Mercury, and went back down to more of a Dodge/Pontiac contender. And speaking of Dodge, what had been the traditional Dodge market was now represented with just the Polara, which may have sold around 20,000 units or so. The bulk of Dodge sales were Darts, and now the Lancer…Plymouth territory, really. The bulk of Chrysler’s sales were the cheap Newport, which was now down into Dodge territory as well, actually undercutting what little remained of DeSoto.
And Pontiac/Olds/Buick were now pushing compacts, which came in at a much lower price point that what was traditionally considered “middle priced.” So, the midsized market got ravaged even more than what that chart suggests, in my opinion at least.
Yes, there’s many additional details that could be parsed (or charted), but it gets pretty complicated. Maybe another time?
The economy was definitely cooling as 1957 went on, and remember that maybe 1/4 or more of the disastrous 1958 model year took place in the final months of 1957. The economy came out of that recession very slowly, and it was probably 1964 before things were back in what we might think of as prosperity.
Buick’s share really got hammered in this period, and probably accounts for a lot of the losses in the category.
Another thought is that baby boomer parents in the demographic that bought cars like these started looking at higher education expenses in this period, and were probably trying to be sensible. They came back to that market later, along with the silent generation who had been big into imports and compacts as young adults.
The economy came out of that recession very slowly, and it was probably 1964 before things were back in what we might think of as prosperity.
The annual GDP growth number don’t seem to bear that out:
’56: 2.1%
’57: 2.1%
’58: -0.7%
’59: 6.9%
’60: 2.6%
’61: 2.3%
’62: 6.1%
’63: 4.4%
Seems to me the very minor negative number for ’58 was more than offset by the very strong growth in ’59.
The second part of your comment seems a bit speculative. I’m not even sure what time period you’re referring to.
I think a couple other factors at play, were simply that the market was oversold in 1955-56. For the most part, the 1955 models made the 1954s look ancient, and there were big advances in performance, so that probably made a lot of people buy a new car earlier than they would have, otherwise. 1957 was really Chrysler’s year, as they were “new” enough to gain in an otherwise down year, both in sales volume and market share, while just about everyone else stayed fairly flat or fell. Ford division also did well that year, but the new, bigger Mercury didn’t go over so well, and Lincoln tapered off.
I have a feeling that, if Chrysler had simply fielded warmed-over 1956 models for ’57, total ’57 model year production would have been even lower than it was. Sure, some of those buyers would simply have gone to other brands, but I’m sure many would have held off on trading, and just kept whatever they were currently driving.
As for recessions, often Main Street lags Wall Street. We don’t really know we’re in a recession until it’s called, and that metric is usually two consecutive quarters of negative growth. Then, once they start calling it a recession, layoffs continue, people put off major purchases for a bit, and even though the economy improves, by Wall Street metrics, it still often takes awhile for unemployment numbers to peak, and then go down.
So often, the auto industry’s sales will react more to the immediate aftermath of a recession, rather than the recession itself. Or, another scenario could be like what played out in 1979. If you look at sales numbers, it looks like a phenomenal year. However, there was the second Arab Oil Embargo, and the effects of that started showing around April of 1979, with fuel shortages, rising prices, long lines, etc. So, the first 2/3 of the year, perhaps, were phenomenal, but the last 1/3, not so much. And then, I imagine a lot of those cars that had been cranked up, in anticipation of continued prosperity, sat around on the lot, or inventory building up in storage, and were eventually unloaded at a deep discount. So even though that still counts as a sale, and added to the already impressive production totals for that model year, that sale could have still come at a great cost.
I would add to this that there were more mid-priced cars in the early 1950s that aren’t showing up on the charts: Nash and Hudson (full size, not Rambler/Jet), some Packards, and Kaiser/Frazer (though by 1955 they were gone), and upper-level Studebakers. This would make the decline seem even worse since by 1958 all were gone from the market.
True. It would require much more parsing and splitting to arrive at a more nuanced set of numbers. One would have to split Studebaker, as the Champion was clearly low priced but the Commander/President were mid-priced.
The same issue applies to most of the others you cited. Maybe on a long dark wet day?
Very interesting chart. This brings to mind an article that I read a while back in an 1957 or ’58 copy of Fortune magazine, which was on the topic of small cars, and who exactly bought them. What made that article particularly interesting was both the time frame (during the recession-induced compact car boom) and that it was published in a business magazine, rather than a car enthusiasts’ publication.
Fortune surveyed small car owners as part of the article, and the most interesting takeaway that I remember was that the majority of respondents indicated their main reason for buying such a car was “economical operation” rather than “low purchase price.” This represented a big change in consumer expectations – beforehand people were much more focused on initial purchase prices (likely with the assumption that they’d buy a new car every few years anyway). As you point out above, Detroit therefore thought that “cheap cars” equated to “used cars” and couldn’t foresee people’s changing expectations.
Unless one reads old media articles, it’s hard to grasp how significant the change was in consumer behavior and attitudes. There was a very palpable sense that a significant segment of new car buyers suddenly felt that they just didn’t believe in the Detroit big-car myth anymore.
The massive fragmentation of the market that has never stopped started right about 1955/1956. It was suddenly fashionable to not want a big Buick or such.
The growth in the size, weight, and power of full-size cars during the 1950s, together with the introduction of popular fuel sucking options such as automatic transmissions, power-steering, and even A/C on higher end cars, resulted in a drop in MPGs from 16-22 using cheap regular gas in the early 50s to probably something closer to 8-14 using expensive premium by the late 50s. Thus a trim sized 20-30 mpg Lark, Rambler, or VW made a lot more sense in terms of economics and convenience in the late 1950s than they did in the early 50s, particularly when the full-sizers didn’t actually offer any more space inside as they grew in physical size and thirst.
Well, by 1964 mid-priced market share was about 32%, compared to 37% in 1955. Is that really statistically significant? I dunno.
My take is that as the economy rapidly improved in the early sixties, there was a signifiant increase in two car households. And that extra car was likely a low priced compact. A nice Buick, as usual, but now accompanied by a Corvair or VW.
Would there have been a recovery at all if you left out the Dodge and BOP compacts and A bodies? What were the absolute mid-priced sales numbers in this period? That would better define the ’58 recession/crash. Did they end with a smaller portion of a bigger pie, so more or less where they started?
Was increasing Cold War tension a factor in the recovery being only partial? Sputnik was Oct ’57, the U-2 in ’60, Berlin Wall in ’61, Cuban crisis in ’62.
Sometimes I feel like Chrysler only survived because the company itself was called Chrysler.