Checker Motors Corporation
|Defunct||January 14, 2010|
|Key people||Morris Markin Founder|
Checker Motors Corporation was a Kalamazoo, Michigan, based vehicle manufacturer and tier-one subcontractor that manufactured taxicabs used by Checker Taxi. Checker Motors Corporation was established by Morris Markin in 1922 through a merger of 'Commonwealth Motors' and 'Markin Automobile Body'.
Checker made the iconic American taxi cab which was valued by taxicab companies for its durability in heavy use. Special features included large rear seats and trunks. The company had trouble competing with fleet discounts offered by the larger manufacturers as well as economies of scale in procuring components. The final models were produced in 1982.
Morris Markin (a clothier from Chicago, Illinois) became the owner of 'Markin Automobile Body', an auto-body manufacturer based in Joliet, Illinois following a default by the owner on a $15,000 personal loan. The facility made bodies for 'Commonwealth Motors' who marketed the vehicles to cab companies under the trade name 'Mogul'.
Commonwealth Motors was on the verge of bankruptcy but had an order from Checker Taxi (a privately owned cab company in Chicago that had no affiliation with Markin at the time). Markin merged Commonwealth Motors with Markin Automobile Body in order to honor the contractual commitment. In 1930 Checkers came in either black, maroon, yellow or canary.
Markin was later to buy the Checker Taxi Company.
|Model H-2(1923)||4-cylinder||22.5||127 in (3,226 mm)||5|
|Model E(1924)||4-cylinder||22.5||117 in (2,972 mm)||5|
|Model E(1925-1926)||4-cylinder||22.5||117 in (2,972 mm)||5|
|Model F(1926-1927))||4-cylinder||22.5||117 in (2,972 mm)||5|
|Model G-4(1927-1928)||4-cylinder||22.5||117 in (2,972 mm)||5|
|Model G-6(1927-1928)||6-cylinder||27.30||124.75 in (3,169 mm)||5|
|Model K-6(1929)||6-cylinder||27.30||127 in (3,226 mm) ||6|
The company entered the consumer passenger car business in 1958 and consumer automobiles were phased in regionally across the US in 1959 starting in New York and New England. Nationally, introduction of the Checker Superba took place at the Chicago Auto Show on February 8, 1960.
The dealer network continued to grow throughout the early 1960s, and throughout the decade Checker usually managed its target volume of 6000-7000 cars a year. In 1962, production topped 8000, although most of those were taxis. Four-door sedans and station wagons (Superba and Marathon models) also were advertised to individual customers in upscale publications. The ads emphasized the durability of the Checker and the attention to quality improvements. In 1962 almost 3,000 cars were sold to individuals, 20% of production, but that percentage declined to 10% in the 1970s.
In addition to automobile production, Checker played a significant role as a third-party automotive supplier of OEM body stampings. In the late 1930s, Checker produced truck bodies for Hudson in addition to manufacturing complete Ford truck cabs. Checker also produced truck bodies for the REO Motor Car Company.
In 1964 the state of New York pursued Markin and Checker on antitrust charges, alleging that it controlled both the taxi service and manufacture of taxis, and thus favored itself in fulfilling orders. Rather than allow Checker drivers to begin buying different brands of cars, Markin began selling licenses in New York City.
In 1977, seven years after the death of Morris Markin, retired GM President Ed Cole bought into Checker with the intent of re-energizing the company and developing a new, more modern Checker. Cole's plan was to purchase partially completed Volkswagens from VW's new Westmoreland Assembly Plant. Cole was going to ship the VWs to the Checker Motors factory in Kalamazoo, cut them in half, insert a section to lengthen the VW, raise the roof and then sell the reconfigured vehicle as a taxi. Shortly thereafter, however, Cole died when his plane crashed near Kalamazoo.
1970's Model Data
|Marathon||250CID I6||145 hp (108 kW) (1971); 110 hp (82 kW) (1978)||3-speed automatic||120 in (3,048 mm)||204 in (5,182 mm)||76 in (1,930 mm)||7.5 in (191 mm)|
|A11E||350CID V8||245 hp (183 kW) (1971); 160 hp (120 kW) (1978)||3-speed automatic||129 in (3,277 mm)||213 in (5,410 mm)||76 in (1,930 mm) ||7.5 in (191 mm)|
In 1989, Checker Motors and Checker Holding Company were involved in a reverse acquisition with International Controls Corporation (Great Dane Trailers), and the company later changed its name to CRA Holdings. The company was reorganized in 1995 into three wholly owned subsidiaries: Yellow Cab (owns and leases taxicabs in Chicago), Chicago Autoworks (taxi-cab repair and other services) and CMC Kalamazoo. Other subsidiaries include American Country Insurance Company, a provider of property and casualty insurance, Great Dane, (the largest manufacturer of truck trailers, containers and chassis), and South Charleston Stamping & Manufacturing Company.
The company was renamed as Great Dane Limited Partnership, and was acquired by Chicago based CC Industries.
Purchased in August 1989, South Charleston Stamping was sold by Checker to Mayflower Corp. In November 1996. South Charleston Stamping had been owned previously by Volkswagen and supported Volkswagen automobile production in Pennsylvania in the late 70's.
Checker Motors operated as a subsidiary of CC Industries as an automotive subcontractor, primarily for General Motors into the 21st century. Checker made body stamping for various GMC/Chevrolet truck lines and chassis components for Cadillac. David Markin, son of founder Morris Markin, continued to act as CMC Chief Executive Officer.
In 2008, due to the Late-2000s recession and high gasoline prices, sales at GM and other automakers plummeted. As a major supplier to GM, Checker saw its sales drop significantly. The company had net sales of $61 million in 2008 and projected 2009 sales of only $34.5 million, a decline of 43%. During the summer of 2008, Checker employed about 340 workers.
While the US economy was in full recession, Checker Motors CEO David Markin fell victim to the Ponzi scheme started and run by Bernie Madoff. David Markin's name appears five times on the official list of Madoff victims. One address on the list was 2016 North Pitcher Street, Kalamazoo, the same address as Checker Motors Corp.
On January 16, 2009, the 87-year-old Kalamazoo company filed in U.S. Bankruptcy Court in Grand Rapids, Michigan. Escalating raw material prices and dwindling sales for their customers' products were cited as the main reasons for the filing, but another reason was labor costs. It was reported that a deal with unionized labor could not be reached after a year of negotiations.
At the time of the bankruptcy, Checker's customer base included General Motors, Chrysler LLC, Ford Motor Company, Navistar International and GM Shanghai. Checker was the eighth largest American auto supplier to go bankrupt in recent years. GM and Chrysler followed Checker's bankruptcy just several months later.
In February, Checker asked the U.S. Bankruptcy Court for Western Michigan to reject its contract with 125 union workers and eliminate health care and pension benefits for 176 union retirees. On February 27, 2009, the judge in Checker Motors Corp.'s bankruptcy case threw out the company's request to eliminate its labor agreement. Bankruptcy Judge James D. Gregg agreed with United Steelworkers Union Local 2-682 attorneys, that the company had not treated all parties involved in the proceeding fairly when it awarded four top executives a total of $275,000 in retention bonuses prior to filing for bankruptcy.
In Late March 2009, a committee of unsecured creditors in the bankruptcy case asked U.S. Bankruptcy Court Judge James D. Gregg to consider whether negotiations between the union, United Steel Workers Local 2-682, and Checker Motors can resume and reach concessions, or if a mediator should be brought in, according to court documents.
On April 4, 2009, Checker notified its more than 270 employees that CMC would close its business by the end of June.
In a bankruptcy court hearing Monday, April 6, 2009, CMC and labor union representatives said they intended to continue trying to negotiate a new union contract that would allow Checker Motors to survive.
In May, Checker was given permission to enter into agreements with General Motors Corp. that were intended to help the bankrupt supplier stay afloat until it could negotiate the sale of itself to a new owner.
In Late May, Checker announced that they found a potential buyer, The Narmco Group.
On June 9, 2009, Judge Gregg approved the sale of Checker Motors Corp. to the subsidiaries of two Canadian automotive suppliers, Narmco Group LLC and Van-Rob Inc.
The Narmco Group, based Windsor, Ontario, paid $650,000 for Checker's business of making stamped metal and welded assemblies for GM trucks and other vehicles. Van-Rob Inc., based in Aurora, Ontario, paid $950,000 for some of Checker's manufacturing equipment.
Christopher Grosman, an attorney representing Checker Motors, told Judge Gregg that the offers from Narmco and Van-Rob represented the "highest and best value" to Checker's creditors. Grosman said much of the company's machinery could not be sold because, in the wake of downsizing throughout the automotive industry, the market has been flooded with similar equipment.
The $1.6 million sale meant the end of the road for Checker. Approximately 125 Checker workers in Kalamazoo made parts until June 30, then the business was transferred to Canada.
In July 2009, General Motors Corp paid $1.5 million to Walker Tool & Dies for tools and dies that remained on site at Checker. Walker Tool had liens on the tools, so payment was required in order to move the tools to Canada. The tooling was transferred to Canada to make the Buick Lacrosse.
On January 14, 2010, the Checker Motor Company ceased to exist with the sale of its Kalamazoo headquarters. It was purchased for just under $3 million by a holding company, the Jones Group, which will sell off the assets and clear the 72 acres. Checker president David Markin was quoted in the New York Times, "It's finished. Our family is very distressed about the closing of the company, but it became inevitable."
Checker is best known for its taxicab, on which it built its business and reputation. In its early years, Markin not only produced the vehicles but also ran Checker Cab, a taxi company which was in direct competition with John D. Hertz, owner of the Yellow Cab of taxicabs.
During the 1930s, Checker built trailers for Sears-Roebuck and truck cabs for the Ford Motor Company. Checker also built four prototype Jeeps that were tested by the U.S. Army. They were developed in partnership with the American Bantam Company (a builder of Austin-based tiny autos) and featured four wheel drive and four wheel steering. During World War II Checker built tank retrieval trailers, tank recovery vehicles, as well as semi, petroleum and other types of trailers.
Checker designs changed infrequently; Markin held on to certain design features long after they were discontinued by major automobile manufacturers. For example, open front fenders were retained by Markin into the 1940s because it saved operators the expense of repairing minor dents. Taxicab models were designated by a letter series; significant modifications in models (new major systems, etc.) were designated by a number following the model letter.
Checker's commercial vehicles were usually given letter designations instead of model names (most notably variations of the Checker Model A). An exception to this rule was the Checker Aerobus, an extended version of its cars, built on a stretched wheelbase allowing for each row of seats to have its own doors. The Aerobus was often associated with airports and train stations, although vacation resorts also used Aerobuses for transporting guests.
From 1922 to 1959, Checker's production vehicles were built almost exclusively for the commercial livery (taxi) business, although cars for personal use were available upon request. Checker entered the consumer vehicle market when taxi sales declined.
Limited consumer sales began in the fall of 1958 in New York City. For the next 12-15 months Checker would continue to expand its dealer network on a regional basis. The first new market after New York City was Boston and parts of New England. In February 1960, Checker introduced the Checker Superba nationally, their first model specifically built for the consumer market. Joining the Superba in 1962 was the Marathon, which took the place of the Superba Special. The Marathon consisted of standard and long-wheelbase sedans, plus station wagons. Wagons came standard with a motorized fold-down rear seat, which combined with different bodies pushed the price up $350 above the sedan. Limousines were also offered as Checker sought to tap into yet another specialty market. The only engine was the Continental inline six, which had been used in dozens of cars (including Kaiser-Frazer) and trucks since the 1930s. Two versions were offered, a low-compression L-head unit with only 80 hp (60 kW), and an OHV unit with higher compression and 122 hp (91 kW). Three-on-the-tree manual shift was standard, and a Borg-Warner three-speed automatic with optional overdrive was an option. Civilian models were as utilitarian as their fleet counterparts, sporting a simple, flat dashboard with round gauges (this would remain unchanged up to the final Checkers in 1982), rubber mats instead of carpeting, and hardboard ceilings. Floors were flat to allow easy entry and exit.
Checker's cars were lightly marketed using campaigns that centered on their durability and unchanging style. Checker also promoted their vehicles as 200,000 mi (320,000 km) cars at a time when most US automakers shied away from mileage promises.
The Marathon and A11 design was based on the 1956 Checker Model A8. The A8 was Checker's response to new New York City taxi laws that mandated that taxis could not run on a chassis wheelbase longer than 120 in (3,000 mm). The main difference between the A8 and A11/Marathon was the use of quad headlights in the latter. Checker cars and taxicabs used the same basic body and chassis design from 1956 until production ceased, as Morris Markin declared that there would be no major changes as long as there was a demand for the car. However, there were numerous alterations in the appearance of the cars throughout production, especially in the late 1960s and 1970s. Starting in 1967, an energy-absorbing steering column was fitted to meet safety regulations, similar in appearance to AMC's column. 1968 saw round side marker lights on each fender. Seat belts were fitted as mandated by the US Government, including shoulder belts on Checkers built after December, 1967. 1969 cars got high-rise headrests, and 1970 models adopted the government-required steering column and shift lever lock. 1974 Checkers eschewed the attractive, chrome-plated bumpers for girder-like, aluminum-painted units. '75s featured the catalytic converter emissions device, which came with an "Unleaded Fuel Only" label for both gas gauge and fuel filler. During the 1970s, Checkers adopted a standard Chevrolet steering column assembly, including steering wheel (sans the "Chevrolet" badges), shift lever and ignition switch. 1978 and later models can be identified when Chevrolet switched to a "Delta Spoke" steering wheel design, duly used on Checkers. The rear fold-down jump seats were also removed as they failed all safety tests. The car had very poor gas mileage as the tall front end and engine compartment had been designed for a Continental 226 cubic inch inline six, which required the large engine compartment. Overall, Checker sales began shrinking in the 1970s, causing the company to reduce their production capacity. Limousines were dropped after 1970, and wagons followed in 1974. The standard and long-wheelbase sedans remained until the end. This decline was due to a number of factors. First, the oil embargo of 1973-1974 (and later the 1979-1982 recession) caused the Big Three to lose consumer sales, and they attempted to make up for this by targeting the fleet market more aggressively. Checker could not hope to compete on price, which due to inflation had risen to almost $5000 by the middle of the decade. This was Buick and Chrysler territory, and a large sum for a dated car with unimpressive build quality. Safety and emissions requirements added further costs. Meanwhile, the company refused several proposals for a replacement to its 20-year-old design in part due to lack of funding, and also due to managerial resistance. Ed Cole's death put an end to his ambitious plans, and car production finally ceased in 1982 after Checker's output dropped to less than 1,000 vehicles per year.
In 1964, Checker stopped using Continental engines. Continental had been losing money on each unit sold to Checker for several years and Checker was not interested in a price increase. Checker experimented with several engine options including the Chrysler 318. Eventually Checker went to a Chevrolet straight six. That engine, along with an optional Chevrolet V-8 were used until the late 1970s. Engines and drivetrains matched the full-size Chevy models. During the 1970s, the Impala's Turbo-Hydramatic 400 transmission was fitted to all Checker sedans. Some of the last Checkers built were equipped with Oldsmobile 350 diesel V8s.
When GM ceased offering the straight six in their Impala models for 1979, Checker purchased a small V6 that was also used in the big Chevys. However, the large and tall grill and hood made for poor aerodynamics, which contributed to the car's poor gas mileage. A number of the V6s were converted to use propane as fuel. Many of the body stamping dies were worn out after 20 years of use, and that required manual body adjustments by body and fender mechanics to make the parts fit. The fenders and doors were the most problematic, as taxis are involved in numerous minor accidents due to their heavy usage. With the Marathon outmoded and not selling in viable quantities, and with no resources to develop a new model, Checker decided to leave the auto manufacturing business. The last models were produced for the 1982 model year, and the final automobile rolled off the assembly line on July 12, 1982, after members of the Markin family decided to end production rather than meet labor demands. The last of the Checker taxicabs went out of service in New York in 1999 - a New York City taxicab ordinance was passed in 1996 where livery vehicles must be replaced after 6 years of service.
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