02/26/2026
(June 5, 1940) HUPP CAR'S REPORT NEARLY COMPLETE
Tentative and Unaudited Data Show Current Assets of $176,137 at Close of '39
_
VARIOUS PROPERTIES SOLD
_
Large Loss for 17 Months to May 31 Expected Despite Deal With Graham Paige
Auditors now at work on the annual report of the Hupp Motor Car Corporation for 1939 will complete their labors in two weeks, according to a letter to shareholders signed by Percy L. Louks, secretary, under date of June 28. Tentative and unaudited figures for the year which ended Dec. 31, 1939, he said, showed total current assets of about $176,137, including cash of $27,392; fixed assets not of amortization and depreciation of $2,634,628, and funds to closed banks totaling $162,877 which are pledged as collateral to a bank loan and against which a reserve of $85,208 has been erected. Deferred charges to future operations total $22,901. On the same basis, said the letter, current liabilities were $522,248 (partly secured by claims against closed banks), which included $135,000 as provision for loss on purchase commitments. Fixed liabilities, covered by a mortgage to the Reconstruction Finance Corporation, were $852,087.
Loan on Claims Increase
Since May 31, the letter revealed, the loan on the claims against the closed banks has been increased to $118,758. Moreover, the corporation has sold its service department for $65,000 and applied $51,500 of the proceeds to reduction of the RFC mortgage. The letter continued:
"In September, 1939, the corporation entered into an agreement with Graham Paige Motor Corporation under which the latter agreed to furnish funds to complete and make additions to the tools, dies, etc., for the manufacture of the Skylark car, and to manufacture bodies and other parts of the car for this corporation. It was agreed that Graham Paige would provide itself with additional working capital of $1,500,000 by a loan from the Reconstruction Finance Corporation. In consideration of this arrangement Graham Paige received the right to use the body dies and tools for the production of a car of similar design for its own use.
"Pending completion of the dies a temporary production of 700 cars was projected by Graham Paige, of which this corporation was to receive 350. This corporation proceeded with the manufacture of its own motors, brakes and chassis parts for these cars. Of this temporary production for Hupp to date Graham Paige has manufactured 102 cars and this corporation has taken and shipped approximately sixty cars.
Reduced Plant Space
"In view of the arrangement with Graham Paige this corporation has been able to plan the contraction of operations to a much smaller plant space sufficient for the manufacture of motors and other chassis parts. A substantial reduction in overhead expense has thereby been effected and a considerable part of the buildings and equipment of the corporation freed from the requirements of operations. More than 400,000 square feet of floor space so released from operations have been leased by the corporation to others.
"Prior to Dec. 31, last, certain properties owned by subsidiaries in Ohio were disposed of, consisting of a vacant factory building in Cleveland for $77,500 (against which there were accrued taxes of $28,907) and also the plant and equipment of the Atlas Manufacturing Company at Fostoria, a wholly owned subsidiary, sold for $115,000 (against which there was a mortgage indebtedness of $75,000). The corporation also has, in the five months ended on May 31, disposed of various items of machinery and equipment not required in operations at a total price of $23,178. Notwithstanding the foregoing, the fiscal year 1939 and the five months' period ended May 31, 1940, will show a substantial loss from operations."
