Death of the Tucker ‘48 — Part III
a.k.a. The Tin Goose
In 1940 Preston Tucker was a small time parts manufacturer in the Detroit suburb of Ypsilanti; so small time that his “plant” was a barn in his backyard. But he hit it big during the war years when his design for a four-wheeled weapon that could reach speeds of 117 miles per hour caught the eye of some of the Navy’s top brass.
Although the Navy had no use for a military vehicle, they loved the turret he installed on the top of the car because it came complete with a mounted machine gun that could rotate 360 degrees. They went all in and ordered those turrets, “Tucker Turrets”, installed in all of their PT boats, along with their B-17 and B-29 bombers. So instead of manufacturing military vehicles Tucker started building machine guns, and he made a good living at it during the war years, but on the side he dreamed about cars. Although not about the ones that he saw down at the local dealership. When Preston dreamed he only dreamed about things that didn’t exist, like warrior race cars with revolutionary machine guns. And while he dreamed he talked; to his employees, to his suppliers, to local engineers, to anyone who would listen to his idea for America’s first, great post-war vehicle.
The country had been through a lot over the last 16 years; falling prices caused 25% of the population to lose their jobs, along with everything else they had, while most of the remaining 75% just tried to hang on for dear life. And then the War came, which cured the unemployment problem, but at a very high cost. Roughly 300,000 Americans died during World War II, while countless others suffered life-altering wounds. And unlike modern warfare, the battle against the Axis powers was a group effort. Every day at home, those not on the front lines fought the Battle of Supply and Demand. Items like cars, bikes, fuel, stoves, rubber-soled shoes, sugar, meat, cheese and milk were all in such high demand in the theaters in Europe and Asia that those who stayed behind were forced to live off of rations. The government parceled out the minimum quantity of these staples to civilians while the lion’s share went to supply the war effort.
As the outcome of the nearly 7 year conflict grew more certain, Preston correctly understood that soon everyone was going to want to celebrate, both the returning troops and the war-weary public. A good chunk of them, he figured, would do it by buying a brand new car. And they wouldn’t be interested in the same old tired design they’d seen year in and year out during the recent, miserable past. No, this generation would happily pay out to drive a performance vehicle that would help them forget how hard their lives had been.
Though Preston was still just a small time munitions supplier, he knew this fact better than anyone in the country and for years had been designing and talking about just the type of car that would meet all that pent up demand. Eventually Preston’s name made its way into the engineering circles in Detroit, where people in the industry and the press around the industry were all beginning to wonder which of the Big Three was going to be the first to build the next great American car. Ray Russell, a local engineer thought he knew the answer and placed a call to a reporter friend by the name of Charles Pearson, telling him “Why don’t you go and see Tucker? I hear he’s got something.” Pearson eventually made the trip to Ypsilanti and when he got there found that the “something” that Preston had was actually a fully designed rear-engine vehicle, along with a color brochure at a marketing firm near the GM building and a pending contract with a plane company to supply the motor.
In the summer of 1945 Pearson wrote an article about the “Tucker Automobile” and sold it to Pic magazine who scheduled to feature it in their January 1946 issue. Shorter versions of the Pic story were sold to other magazines around the country and in no time at all Preston Tucker had received over 150,000 letters and telegrams about his new car. The public was clearly hungrier for a new type of ride than even the very optimistic Preston Tucker had imagined. The initial press, which consisted of a few artists renderings of the vehicle in addition to drawings of some of its components, had generated a flurry of buzz that in today’s parlance would be referred to as “going viral.” Sorority girls were voting Preston Tucker “the man they’d most like to be marooned with on a desert island” and radio shows across America spiced up their news spots with stories of the Tucker automobile, which at the time was nothing more than a drawing, a few pending contracts and some specs.
But Preston knew that behind all that buzz were hundreds of thousands of men and women who were willing to plunk down $1,000 to $3,000 to buy his machine. So he left the turret business to his managers and moved to Chicago in order to secure the lease on an Old Dodge plant that the Government had taken over during the War. At the time it was the biggest plant in the entire world, built at a cost of $170,000,000 and extended over 475 acres. It had its own power plant, foundries, cafeteria, hospital and every other normal amenity you would expect from an industrial mega-building. Not only was the facility incredible but it already had $30,000,000 worth of equipment sitting inside of it, much of which was exactly what Preston would need to build automobiles. But the clincher though, what sealed the deal, was that the government was willing to rent the whole thing for only $150,000 a month, a steal of a price.
It was perfect, too perfect. It seemed impossible that every single thing would fall into place at just the right time so that Preston could build and sell what the auto-crazed public desperately wanted to buy. Now, with the location of his company figured out, there seemed to be only one tiny, little issue that was still unresolved: Preston only had $12,000 in the bank. Just a tad shy of what he needed to make the first month’s rent; and yet he went to Chicago anyway.
Nobody does that you know. Even if they have an article printed about their idea in the national media that generates a good chunk of positive press, nobody then says, “Well, I guess I better go make a bid on the largest manufacturing plant in the world. After all, I do have $12,000 in the bank.” Tucker was nuts, but not entirely crazy.
Though at that point he didn’t have any cash, he did have other assets. The buzz surrounding his car had caused a few very respectable names in Detroit to follow him out to Chicago: Robert Pierce, former controller of the world’s largest independent auto body manufacturer, Fred Rochelman former sales manager for the entire Ford Motor Company and Ray Raush another Ford exec who supervised all but one of Ford’s manufacturing plants. And the list goes on, there were heavy hitters from GM, Chrysler and Studebaker all wanting to get in on the next big thing to hit the automotive industry since the Model T.
Preston was like some sort of 20th century pied piper who was about to punish the Big 3 for not innovating. After some initial finagling for a better rental agreement, the government agency in charge of the plant gave the Tucker Corporation a 10 year lease, during the first two they would only have to pay $500,000. But afterwards the price would rise to $2,400,000 a year or 3% of sales, whichever was greater. The only catch was that the entire deal was contingent on Tucker’s ability to raise $15,000,000 by March 1, 1947. The Government wanted to know that he was serious. So in other words, in less than a year from the time the original Pic article was published and a mere seven months after the formal establishment of the Tucker Corporation, Preston Tucker had generated a ridiculous amount of press for a yet non-existent automobile, convinced some of the biggest names in the industry to join his fledgling company and secured the lease for the largest industrial manufacturing plant on planet earth. And the only tools at his disposal to get all of that done were a few drawings of his car and $12,000.
It was amazing — unprecedented, and for everyone else in the industry — dangerous. So out came the wolves.
On October 28th 1946, just as the Tucker Corporation was preparing for a $20,000,000 stock issue, the Herald American plastered the following headline all over Chicago in bold, red letters: “TUCKER LOSES DODGE PLANT.” Out of nowhere Wilson Wyatt the head of the National Housing Agency had decided that the Dodge plant should go to the Lustron Corporation so that they could build prefabricated houses. In line with his wishes he issued a directive ordering the War Assets Administration to cancel its lease with the Tucker Corporation and assign it to Lustron and then leaned on the Reconstruction Finance Corporation, the same government agency that was propping up Kaiser, to loan the Lustron Corporation $12,000,000.
That headline threw an enormous wrench in the whole operation, the type of wrench that would bury anyone, even the very best of us. Remember, by late October of ’46 Tucker only had 4 more months to raise $15,000,000. In that short amount of time not only did he have to get the SEC’s blessing for his $20,000,000 stock issue but he also had to find enough people who wanted to buy $20,000,000 worth of Tucker stock. Not an easy task for any company, let alone one that didn’t even exist seven months prior. Mix in the fact that the stock sales would be based upon the concept for a car that Tucker had yet to convert into a mass producible reality, especially now that he didn’t have a plant, and you quickly find yourself facing a set of hurdles that no one on planet earth could possibly overcome. Yet some readers still might not appreciate the enormity of the task he faced, because in the internet age raising vast sums of money to support a completely unproven venture that doesn’t have a physical presence anywhere might not seem so strange. So, I’ll remind you that the year was 1946 and Tucker was promoting a brand new automobile, a product with thousands of component parts that requires the cooperation of thousands of human beings if you are ever going to manufacture even the most mediocre product. It was not some new information transmitting innovation that could be programmed by two Lucky-Charm’s-slurping geeks who operated out of their grandma’s basement.
But let’s set the political battle and the stock issue aside for a minute and remember that Tucker’s primary concern was not issuing stock but actually being able to manufacture a functional car that delivered on its promises. And for the record, though I’m very impressed with what Preston Tucker had accomplished up to this point, he was not superhuman. Sure he was capable of accomplishing much more than the average Joe, but there’s no way he could be president of the Tucker Corporation, and the CFO and the chief engineer, and the plant manager, and the head of human resources and the guy on the line driving rivets into chassis and the other guy procuring raw materials from suppliers and the secretary answering the phone and the other secretary following up with so and so, and so on and so on.
If only to pretend that he was going to build a car so that he could fleece naïve investors, Tucker still would have needed a serious store of cash just to meet the very minimum payroll requirements of a phony car company. And the problem only gets worse if he actually intended to build a car. $12,000 never would have cut it. With only $12,000 to spend on help not even Preston Tucker could have pulled off a $20,000,000 stock issue. The truth is that before he could even dream of raising the required $15,000,000 he needed a good $5,000,000 just to get the venture rolling in the right direction. All of those big names he poached from the Big 3 weren’t going to work for free. And in order to convert the plans in his head into a reality he needed a whole team of engineers. And those engineers needed time to design and test and then redesign and retest all of Tucker’s crazy innovations; and while they were doing all of that testing and redesigning they needed materials and paychecks. Since all of these things needed to start happening immediately there was no time to go the traditional route and get a loan from a bank. No bank was going to sign off on a loan of that size to a venture like Tucker’s within the time frame he needed. So what do you do when you need $5,000,000 in hurry and no one will loan you the money?
You sell franchise rights of course.
Doesn’t everybody who still has yet to produce one solitary product, who still hasn’t made a single sale, first hit the road and offer franchise rights for the non-existent product to retailers across the country? Of course they do — at least that’s what Tucker thought and so that’s what Tucker did. Without so much as a scale model of his car to show prospective dealers Tucker raised $6,000,000 from over 100 dealers in 21 States who, though well aware of the risks involved with their purchase, wanted to make sure that their lot was the only one in town that could offer the Tucker automobile. It’s like I said, Preston Tucker was by far the greatest car salesman the world has ever known. He almost literally pulled $6,000,000 out of thin air so that he could make his brand a reality.
And with that money he started to build his car so that piece by piece what had previously been nothing more than a drawing in a magazine finally began to take shape. Steel started showing up at the Tucker plant by the ton along with boxcar loads of electrical wire, batteries, tires and of course hundreds and hundreds of employees. Some were welders and others operated the switchboard while still others processed paperwork for franchisees and the SEC; but everyone, every single one, was bent on building the best car the world had ever seen.
And they did it, you know. Despite the longest of odds, Tucker retained his lease on the Dodge plant. It cost a fortune in terms of lost productivity but that lease was his and he put it to good use. The SEC eventually let him issue stock too, from which he raised a respectable $15,000,000. It would have been $20,000,000 but for some reason Governor Warren of California barred his residents from participating in the initial public offering. So despite the enormous odds he faced and the omnipotent powers who opposed him, Preston Tucker built his automobile. And the vehicle he manufactured wasn’t just any old automobile. The car that rolled out of the Tucker plant in 1948 could have leaped 10 years into the future and matched any 1958 model in its class in terms of engine strength, fuel efficiency, speed, handling and safety. It was a thing of engineering beauty. Unfortunately, only 51 of them made it out of the plant before the Tucker Corporation was put under. Despite a long string of improbable victories, eventually the constant battles drained Tucker of both the time and money he needed to fight on.
Now was the Tucker really that good, or am I just an over enthusiastic cheerleader for a guy whose story has found a soft spot in my heart? To answer that question I’ll reproduce, verbatim, a section of the courtroom exchange between Mr. Daniel J Ehlenz, a Tucker franchisee, and Tucker’s attorney Mr. William T Kirby. Please note that Mr. Ehlenz lost all of the $28,000 he paid to secure his Tucker franchise:
“You have observed the performance of the car?” Kirby asked.
“Yes”
“Did it have good acceleration, Mr. Ehlenz?”
“Yes, very good.”
“I was asking you about the speed you had driven the car upon the open road, Mr. Ehlenz. What about that?”
“I never had the throttle open.”
“About how fast have you gone in it?”
“Probably ninety-five miles an hour.”
“Does the car ride well, Mr. Ehlenz?”
“Yes, it rode well.”
“Does it perform, in general, well?”
“Very well.”
“When you say very well, what do you mean, Mr. Ehlenz?”
“Well, I had never driven another car that performed like that.”
The Tucker ’48 was, in fact, that good. But before there ever was a plant whose lease was in peril, or a production line or even an artist’s rendition of a car — there was a small boy who lived with his brother and his widowed mother in rural Capac, Michigan.
It was the summer of 1909, Preston was 5 years old and he sat next to his Grandfather atop a horse-pulled buggy as the two trotted down some Michigan country road. Suddenly a car approached, the very first car Preston had ever seen in person. Preston’s Grandfather was forced to pull the buggy aside and secure the horses so that they wouldn’t bolt; the sounds of the vehicle being entirely foreign to the animals. Preston’s Grandfather cursed the “gasoline buggy” but Preston was mesmerized by it. It was red. Preston was in love.
Ten years later he convinced his Mother to spend $300 on a used car. The family drove it for a year and a half and when they were done with it, Preston sold it for $300. He used that money to buy a Model T, but Preston’s Mom didn’t like it so he sold it for $350. With that money he purchased a Chandler touring car, but his Mother didn’t like that one either. So he spent $64 tuning it up and then sold it for $610, turning a monstrous $196 profit.
I wish I could’ve met that young man, right after he turned a $414 investment in a Chandler into $610, all by himself. Taking hold of that $610 he must have felt a rush of energy bolt through his arm, go up and down his spine and then right back out his fingertips. Certainly his mind was absorbed in his next move, his next car; how far would he be able to upgrade? If I could’ve only met him, I’d have taken him by the shoulders so that he would’ve had to look me straight in the eye, and I’d say:
“Preston, when you get older all of these ideas bouncing around in your head… they’re going to become a reality. But it doesn’t pan out well for you. They’re going to crush you…”
“Do it anyway.”
