Auburn Automobile Company History Lexington Motor - Auburn Automobile Company, Indiana
The Eckhart Carriage Company, established in Auburn , Indiana in 1874, changed its name to the Auburn Automobile Company in 1900, apparently to reflect a shift in its product line. In June 1919 the Eckhart family sold the Auburn Automobile Company to a group of Chicago bankers. The Chicago bankers operated the firm with limited success until they approached Errett Lobban Cord to take over its management in August 1924. Cord, who had managed a successful auto agency in Chicago, reportedly refused a $36,000 a year contract and asked instead for twenty percent of the profits -if any could be shown--and an option to buy all of the common stock. Cord proved so successful that within five years the bankers were bought out and Cord controlled the Auburn Automobile Company, with several of Auburn's major suppliers. On 14 June 1929 Cord formed a holding company, Cord Corporation, to consolidate his holdings.
Errett Lobban Cord was born on 20 July 1894 on a farm in Warrensburg, Missouri and later moved to Los Angeles with his parents. Cord made a fortune rebuilding old cars and invested it In a chain of garages. He lost the garage business after attempting to run a trucking firm in Death Valley, and when he left California for Chicago he was virtually penniless. In Chicago, he found a job selling automobiles at the Moon auto agency and within a year became sales manager.
Cord operated the Auburn Automobile Company in Auburn before relocating the major portion of the operation in Connersville. Apparently, the Eckhart Carriage Works was too small and its multistoried arrangement was ill-suited to assembly-line production.
In 1926 Cord took the first step in acquiring control of several of Auburn company's major suppliers when he traded Auburn Auto stock for a controlling interest in Duesenberg. The following year, 1927, he gained control of the Lycoming Engine Company of Pennsylvania and bought two of Connersville's major auto plants - the Lexington Automobile Company and the Ansted Engine Works. Along with two other Connersville firms - the Central Manufacturing Company, acquired in 1928, and the McFarland Auto Company, acquired in 1929. Cord controlled most of Connersville's automobile production. By 1 January 1929 the Auburn Automobile Company owned nearly 82 acres in Connersville and had approximately 631,299 square feet of it developed as manufacturing space. Cord spent an estimated $2 million renovating the plant and built several additions in order to facilitate the flow of goods through the factory. On 14 June 1929, E.L. Cord directed the reorganization of several companies under his control, and as a result the Auburn Automobile Company became a subsidiary of the Cord Corporation.
In 1929 Cord also bought a sizable block of the Aviation Corporation (AVCO), a holding company that controlled several small aviation firms. Cord was elected to the Board of Directors. In 1932 he initiated a proxy fight and eventually gained control of AVCO.
The AVCO Corporation won control of the Connersville plants following Cord's resignation and the sale of his stock on 6 August 1936. The first week in January 1938 a reorganization took place under Section 77B of the Federal Bankruptcy Act. After a series of legal maneuvers the Auburn Automobile Company and the Central Manufacturing Company were reorganized as the Auburn-Central Company on 14 May 1940, and in March 1942 the name was changed to the American Central Company.
The American Central Company sold the Connersville plant to Design Manufacturing Company in 1958.