I can tell you what happened to IH in one name: Fowler McCormick. He took the helm in 1941, saw the company through the phenomenally profitable war years and post-war boom times, the company was able to actually pay off its debt burden it had carried since the depression, and it all went to Fowler's head. He apparently got the idea that it was all due to "his" leadership.
That "leadership" gave us the longest production run of any tractor line ever, the letter series lasted from 1939, just before he took over, to 1954, three years after he was fired by the board of directors for his incompetence. Here is what lead to it all and the eventual fall. Fowler left the tractor division to rest on its laurels because he thought that since they were selling all they could make, and so were the other manufacturers, it would last indefinitely. So he ignored the advances and inroads the competition was making and, flush with boom times cash, branched out into all kinds of other markets that IH had no real business trying to enter. For example, he took on industry giant Caterpillar in the construction market, losing HUGE sums in the process trying to play catch up, and we all know about the refrigerators and air conditioners that also never showed a profit for the company, not to mention the fact that Fowler did not spend enough time overseeing all his "visions for the future", preferring instead to start something then leave it to someone else to make happen while he moved on to his next big idea, or went on yet another vacation, (his time spent away from the company nearly equaled his time spent at the company).
This took IH from a company flush with cash and with no debt at the end of the war to a company deeply in debt once again by the time Fowler was ousted in 1951. Then the man the board replaced him with, had both arms tied behind his back by the very same board in that they ordered him not to cut their losses and run, but instead to pursue all the new markets Fowler had entered in order to recoup their investments. Bottom line, IH never recovered their investments and it never recovered from the severe new debt load brought on by this trivial pursuit.
Then came the fiasco of the 560 we all know about, caused by the fact that with the debt load, the board did not want to spend too much time or money developing the new tractor, thus IH lost first place to that green outhouse company from just up the way. The Board did learn their lesson in all this at least, and spent the time and money to do the 706/806 tractors right, but the damage was already done and they never recovered the lost market position.
IH had not had a truly innovative tractor since the first Farmall came out until the 3488, but IH was so far gone by then, even it could not help them, and the company started looking into filing chapter 11 as far back as 1981, but managed to hold on until near the end of 1984 when Tenneco took over.
Then of course Tenneco shoved IH into Case, who had been having their own problems, and the usual lay-offs and plant closing ensued, and we lost a legend.
Others here have already discussed IH's labor issues, lawsuits and such, so I'll skip those, except to say that all these things simply aggravated the already existing debt problems just that much more.
Sorry for the overly long book, but I just felt like I needed to vent.
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