Chrysler & Earnings

Most motorists know the names of the three men who rank just below Alfred P. Sloan in the management and operation of General Motors: William S. Knudsen, Donaldson Brown, Charles F. Kettering. Not so well known are the three topnotch assistants of Walter P. Chrysler: K. (for Kaufman) T. (for Thuma) Keller, Fred Morrell Zeder, B. Edwin Hutchinson. Engineer Keller was hired from General Motors by Walter Chrysler in 1926 to consolidate the manufacturing plants of Dodge Bros. He stayed on to become Chrysler vice president in charge of production. Mr. Zeder was chief engineer at Studebaker in 1924 when Mr. Chrysler invited him to design the first Chrysler engine. He remained to build succeeding models as chief engineer. Mr. Hutchinson, onetime auditor with Ernst & Ernst, onetime treasurer of American Writing Paper Co., performed his first big task as treasurer for Walter Chrysler in 1922 by bagging $12,000,000 in bank loans while money experts were raising their eyebrows at the company's shaky capital structure. Last March when Treasurer Hutchinson raised $25,000.000 at the phenomenally low interest rate of 2.65%, Jackson Eli Reynolds of Manhattan's First National Bank, having heard that Mr. Hutchinson's gall bladder had been removed, was said to have remarked: "All I can say is that they didn't get it all."

Last week Walter P. Chrysler moved out of the presidency of Chrysler Corp. and each of his three executive assistants moved up. Vice President Keller became president, Treasurer Hutchinson became chairman of the finance committee and Chief Engineer Zeder vice chairman of the board of directors, of which Walter Chrysler continues to be chairman. The shifts came at an auspicious time because Chrysler Corp. had just finished one of the most spectacular half-years in history with profits of $18,659,000 and production at an all-time high (TIME, July 29).

Only last year Chrysler Corp. was a conspicuous example of profitless prosperity under the New Deal. With a 52% increase in total sales it actually earned 27% less than in 1933. This year Messrs. Chrysler, Zeder and Hutchinson cut retooling costs to the limit, eliminated certain gadgets from Plymouth, trimmed management expenses in general. The rich fruit of this cost-stabilizing policy was apparent in the percentage comparisons of this year's earnings which showed that while dollar sales increased 30%, dollar profits jumped 126%. Last week the board of directors voted a regular quarterly dividend of 25-c-, a 25-c- extra.

P:Last week, General Motors made an equally bullish report on its operations for the first half of 1935. That company was happy to announce a 14% increase in total sales and a 20% increase in profits. The sales: $594,883,000 against $519,677,000 for the first six months of 1934. The profits: $83,729.000 against $69,586,000. With the extraordinary automobile boom continuing long past the seasonal June peak, G. M.'s second quarter had been nearly twice as profitable as its first. In anticipation of an extra dividend, General Motors' shares rose above 38 last week, highest point in 15 months. P:Packard is not among the big three motormakers, but Packard's President Alvan Macauley is one of the smartest salesmen in the business. Months before the Automobile Show last January he talked of a new low-priced Packard. Unveiled at the Show, his eight-cylinder "120" was put on sale at $980 to $1,095 F.O.B. The success of President Macauley's new venture was apparent last week when Packard announced six-months profits of $290,460 against a deficit of $2,968,000 in the same period last year. Production of Model '"120" had totaled 17,816 units, more than five times the output of all other higher-priced Packard models. P: ;Studebaker, whose reorganization was successfully completed last winter, is one of the few motormakers that ever recovered from a receivership. Last week, reporting for the period since the new corporation took over the business in March, Studebaker revealed that it had not yet regained its oldtime earning power. After absorbing $411,000 of depreciation, interest and other charges, Studebaker showed a loss of $87,000.

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