ABSTRACT
Chrysler ran into a cash crunch in 1954 as the national economy slumped after the Korean War. In addition to facing a weakening market with outmoded products, Lester (Tex) Colbert inherited crumbling factories and a shrinking market share. Then Lynn Townsend, from Chrysler’s public accounting firm Touche Ross Bailey & Smart, took charge. Soon Chrysler was manifesting all the symptoms of an unmanaged crisis. In a case like this, what usually follows is the most critical phase: financial failure as the cash runs out, panic, and collapse. However, Chrysler had a plan for short-term survival—aggressive cash management. As Yogi Berra put it, “People said it couldn’t be done. But sometimes it doesn’t always work out that way.”
