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Bravado Motors (Generations II)


#1

Bravado Motors

Bravado Motors was founded on December 16, 1968, as the result of the merger between Rapid Motor Works and Albany Motor Company. The merger was intended to be the first step in uniting most of the U.S. independent automakers. However, changing financial conditions within the company led to the cancelation of these plans. By the end of the 1971 model year, the Rapid and Albany brands were retired, allowing the company to focus on Bravado's development. Throughout the 1970s, the company continued to experience significant growth, going from selling 47,184 cars in 1973 to selling 65,653 cars in 1974. However, this significant growth was only temporary; in October 1975, Bravado had reported over $73 million in losses over the last two fiscal years. On November 22, 1976, after receiving $72 million in credits from U.S. banks, Bravado announced an agreement with the Japanese manufacturer, Hitomi for the joint manufacture and the distribution of cars. A year later, with Bravado's share of the American market at 1.49%, the company struck a deal with Hitomi allowing Bravado to receive $135 million cash injection, $30 million in credits, and the rights to begin building the Hitomi Lanza in 1978. In return, Hitomi acquired a 22.9% interest in Bravado. In early 1978, U.S. banks refused Bravado further credit, forcing the company to turn to Hitomi for a $75 million loan. By April that year, Bravado's U.S. market share had fallen to 1.3%, and in May sales dropped 16.1%, prompting Bravado to warn stockholders that the company could face bankruptcy if they did not approve a plan for Hitomi to acquire as much as 56% of the company . On December 9, 1978, Bravado shareholders approved of making the Japanese manufacturer, Hitomi their company's principal owner. In July 1979, Bravado's former president and CEO, Hugh Kennedy, announced his resignation from Bravado and named Michael Gallagher, Bravado's vice president of manufacturing, as his successor. Gallagher is credited with streamlining many of Bravado's management techniques during this time. Some of his improvements include reducing manufacturing costs and improving quality control. By this time Hitomi owned 43% of Bravado. While Bravado was figuring out ways to cut costs and remain competitive, Hitomi found itself having to increase its stake in Bravado several times just to keep the company afloat, eventually owning 46% in 1980 and later 58% in 1982. After a period of stagnation, on September 19, 1988, Hitomi announced the phasing out of the Bravado brand. On May 18, 1989, Bravado Motors was renamed Hitomi Motor Manufacturing U.S.A., ending Bravado's 21-year-old life as an "American" manufacturer.