DETROIT - Lynn Townsend was the first of Chrysler Corp.'s rebuilders.
Townsend, who died Aug. 17 at age 81, became president of the automaker in 1961. It was one of many difficult periods in Chrysler history. The year before, the company was rocked by a conflict-of-interest scandal; company officials were found to have a financial interest in supplier firms.
That led to the resignation of President William Newberg on June 30, 1960. Newberg had been named president just 64 days earlier, on April 28.
Chairman Lester Lum 'Tex' Colbert added the presidency to his duties when Newberg departed. He had moved from president to chairman when Newberg became president.
Colbert resigned in 1961 'for the good of the corporation,' and Chrysler needed a leader who was both smart and squeaky clean. Townsend met both requirements. He was an accountant who had come to Chrysler as controller in 1957 from its accounting firm. He was promoted to group vice president of International Operations the following year and to administrative vice president in 1960.
PURE BEAN COUNTER
Townsend was president of Chrysler from 1961 to 1966 and chairman from 1967 to 1975.
These days, much is made of the role of 'bean counters' in the auto industry. Townsend was the second pure bean counter to head a Big 3 company. Frederic Donner, who became chairman of General Motors in 1958, was the first. Harlow Curtice started as an accountant, but had been away from the finance side for 25 years when he was named president of GM in 1953.
As chairman in 1961, Chrysler turned to an outside director - George Love, head of Consolidation Coal Co. in Pittsburgh. Townsend succeeded Love as chairman in 1967.
Townsend's road was not easy at Chrysler. He inherited a company that was deep in the red, and he took the necessary steps of white-collar layoffs and plant closings. Chrysler made a profit in 1962 and was profitable for 11 of Townsend's 14 years as president and chairman.
The last two years were the toughest. Chrysler lost $52 million in 1974 and $260 million in 1975. The products were uninspiring, and vehicle sales plunged. Townsend was under fire from angry shareholders.
In July 1975, he told Chrysler directors that he would retire in October. He was 56 years old.
Townsend said it would be wrong to try to stretch his career to age 65. 'That would be a period approaching a quarter of a century,' he said. 'It is my opinion that a corporation of this size, or any organization of this size, should not be dominated by one person for a quarter of a century.'
ACTIVE IN COMMUNITY
Townsend was active in civic affairs. In 1972 he was president of New Detroit Inc., a coalition meant to revitalize the city after riots in 1967. In 1970, he and his wife, Ruth, helped bring opera to Detroit through their fund-raising efforts.
President Nixon named Townsend to a one-year term as chairman of the National Alliance of Businessmen in 1970. That organization worked with employers to provide jobs for people with disabilities.