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In a last gasp attempt to stay relevant, Studebaker tried its hand at building a speedy personal luxury car in the mold of the Ford Thunderbird or the Buick Riviera. The attempt proved too little too late, and Studebaker went out of business shortly thereafter. Still, many looked at the Avanti and wondered what could have been. Private buyers bought the manufacturing equipment and the name to continue building Avantis. The brand changed hands several times before going quiet for good in 2011.
The Studebaker Avanti
As the 1950s turned into the 1960s, smaller American car makers like Studebaker and Packard were quickly losing ground to the “big three.” With their bigger budgets, Ford, Chryslers, and General Motors were able to research new technologies like power steering and air conditioning. By contrast, Studebakers seemed outdated.
Studebaker brought in Sherwood Egbert to be the company’s new president in 1961. Egbert had previously worked for McCulloch Motors, which produced power tools. The company’s hope was that Egbert, distanced from the auto industry, would take a no-nonsense business approach, and seek new avenues for Studebaker to shore up its business through mergers.
Quite by surprise, Egbert caught the gearhead bug, and decided that what Studebaker really needed was to develop a flashy, sporting car. To this end, he hired the legendary designer Raymond Loewy. Among many other things, Loewy designed Greyhound busses, Pennsylvania Railroad trains, Sears Refrigerators, and the Lucky Strike cigarette package. He had also designed a Studebaker logo with a now famous “lazy S,” in the 1930s.
Egbert was convinced Loewy could bring a striking new design to Studebaker’s cars. Loewy and Egbert worked together on the design which took inspiration from the Jaguar E-Type and jet aircraft. They wanted the design to be unadorned, without the ornaments of other American cars of the time. Egbert wanted the design done in 40 days, which Loewy took as a challenge. There was no time (and no money anyway) to design a new chassis, so the new car would be built on the Studebaker Lark platform.
The resulting body design would have been too difficult to make out of steel, so Studebaker decided to have the body panels built out of fiberglass by MFG, the Molded Fiber Glass Company, who also made the body panels for the Corvette. This solution suited Studebaker well enough, since fiber glass molding was less expensive than metal die casting. The MFG fiberglass had a tendency toward cracking and losing color, so Studebaker eventually started producing the fiberglass panels in-house.
The final product, released in 1962, had surprisingly strong performance. It came with a 289 cubic inch V8 and front disc brakes. It was the first American car to offer disc brakes. Later, power of the base 289 was increased to 240 horsepower. In 1963, Studebaker started offering a 290 horsepower version using a Paxton supercharger. That was Egbert’s idea. Paxton was a subsidiary of his old company McCoullouch. The supercharged Avanti could hit 60 miles per hour in 7.5 seconds and hit a top a speed of 120 miles per hour. That was only a little bit slower than its contemporary Corvette competition. Reviewers were also happy with the Avanti’s handling. Even though it lacked in name recognition, the Avanti had appeal for many drivers.
Unfortunately, it did not have enough appeal to keep Studebaker afloat. The company began closing its factories in 1963, starting with its South Bend, Indiana plant, where the Studebaker was built. The company held on until 1967, selling a small number of cars.
The Avanti II
1963 wasn’t the end of the Avanti, though. A group of Indiana Studebaker dealers, Nate and Arnold Altman and Leo Newman, felt that the car still had untapped potential. They bought the South Bend plant, and all its equipment along with the rights to the Avanti name. They then incorporated as the Avanti Motor Company. The new company planned to hand build the cars, making not more than 300 per year. They never even reached those numbers. The peak was 165 in 1978. It didn’t help that the Avanti II cost more than a Chevy Corvette or a Jaguar E-type.
Still, to a small number of enthusiasts, the car had some appeal. The chassis remained the same, but the engine was sourced from Chevy. In fact, it was the same 327 ci V8 used in the Corvette. Throughout the years, the Avanti II switched to several different GM engines, first the 400, then the 350, and finally a 305. In 1972, Raymond Loewy bought an Avanti II for his personal use.
Despite low sales numbers, the company kept afloat because it was also selling Studebaker truck parts. Still, that arrangement could only last so long. Nate Altman died in 1976, and Leo Newman in 1980. The company passed solely to Arnold Altman. In 1982, Altman sold the company to Stephen Blake, a real-estate investor and self-described “car-nut.”
Avanti Changes Hands Again
By that point, Blake had been trying to buy the company for six years. He told the business magazine Regardie’s “I liked the car so much I bought the company.” The final deal cost Blake $4 million. He estimated that the company was worth ten times that.
In 1983, to prove the Avanti’s capabilities, the company entered a modified version in the 24 hours of Daytona. On lap 27, it was running 4th overall. It also had the fastest lap in its class and was clocked at 207 miles per hour at one point. On lap 30, the Avanti hit the wall, necessitating body panel and battery replacement. Other repairs became necessary later in the race, and the Avanti covered 410 laps, finishing 27th overall. Even if the racing success wasn’t great, the endeavor may have been a marketing success. The Avanti had its best sales year since the Studebaker years, with 289 cars built
In 1984, Blake kickstarted an ambitious plan to modernize the Avanti (while dropping the II, and returning it to its original name). It got power steering borrowed from the Corvette, and new brakes and a new 305 ci engine from the Camaro Z28. The exterior also got a slight update with square, rather than round headlights.
Blake also hired a former Pontiac engineer to design a new independent suspension and a convertible body. He even started a dealer network. Still sales remained low and Blake’s plans proved to be overambitious. The company went bankrupt in 1985 and was sold off to Michael Kelly, the owner of a resort company, for $725,000. Kelly redubbed the company the New Avanti Motor Corporation (NAMC).
Kelly, like his predecessor, had big plans for the Avanti. He completed Blake’s plan of building an Avanti convertible. He also pursued several stretched wheelbase versions of the car: the Luxury Sport Coupe, the Luxury Touring Sedan (a four-door), and a limousine. The coupe and limousine never went into production but the sedan eventually did. Kelly also ultimately overextended the small automaker, and had to sell the company in 1988. The buyer ended up being one of his backers, a real estate investor named John Cafaro.
Cafaro moved production from South Bend, Indiana to his native Ohio. There, Avanti built coupes, convertibles, and finally the Sedan. In 1989, the company seemed to be finding its footing again, selling a new post-Studebaker record of 350 Avantis.
Coming off of this success, Cafaro planned big improvements for Avanti, including four wheel disc brakes, fully independent suspension, and the then new GM L98 engine. Unfortunately, 1991 saw a recession, and these plans were put on hold. Only 15 Avantis were built that year. The plant stopped building cars in 1991, but continued to sell parts.
The Avanti Takes a Strange Turn
With NAMC now defunct, there was public confusion over who owned the Avanti name. An advertising executive named Jim Bunting, who had an Avanti of his own, wanted design a new “Avanti for the ‘90s.” He brought on Tom Kellog, one of the designers from Loewy’s team and Bill Lang, a hot rod builder. They based the new car on GM’s F-body used for the Chevy Camaro and Pontiac Firebird. The new car dubbed the Avanti Experimental or AVX, was essentially a Firebird in Avanti’s clothes. In 1996, Bunting brought the AVX around to meetings of Studebaker and Avanti owners’ clubs. Bunting incorporated AVX Cars to sell the new design, but then decided he wasn’t cut out to run a car company after all, and after only a handful of prototypes had been built, he sold the company to John Seaton.
And Comes to a Stop
In 1999, Seaton teamed up with none other than Michael Kelly to also buy the Avanti name rights from NAMC. They moved manufacturing to Georgia, and with the Avanti name and the AVX design under one roof, they started to sell Firebird-based Avantis. In 2002, GM stopped producing the Camaro and Firebird, but Avanti had enough chassis to last until 2004. In the meantime, Avanti started pursuing a relationship with Ford. The company built a prototype SUV called the Studebaker XUV, and showed it off at several auto shows. The design bore a striking resemblance to the Hummer H2, and GM sued. Avanti eventually settled with GM, and the XUV never came to be.
In 2004, the company redesigned the Avanti to be built on the Ford Mustang platform. Two years later the company moved production yet again to Cancun, Mexico. Shortly thereafter, Kelly was charged with fraud by the Securities and Exchange Commission for running a Ponzi scheme. The Avanti company was also named as a defendant, because prosecutors claimed that the company received money from Kelly’s fraud. The company closed its doors in 2006 and hasn’t built a car since. In 2012, Kelly pled guilty to fraud. Avanti’s trademarks and other assets were sold off in order to raise money to pay back the people Kelly had defrauded.
Perhaps the Avanti never quite got the respect it deserved. After Studebaker closed down, the car itself was seen as a niche item, but the company seemed to have the same fate – treated as a hobby by people caught up in other endeavors.
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