History 2: The Collapse of Oligopoly
The End of Oligopoly
The durability of the Detroit Three oligopoly, given its high profitability, hinged upon the persistence of economies of scale. A number of smaller manufacturers did survive into the 1950s, including Studebaker, Packard, Nash, and Hudson. Two firms attempted entry, a de novo venture by Kaiser together with the moribund pre-World War II (WWII) producer, Graham-Paige, and Willys-Overland, which had made cars in the 1930s and the Jeep during WWII. Neither lasted long. Studebaker and Packard both exited, while Nash and Hudson merged to form American Motors (AMC) in 1954. AMC added jeep production in 1970, allied with Renault from 1978, and then was acquired by Chrysler in 1987 when ...
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