MIT Press Open Architecture and Urban Studies • The Dream of the Factory-Made House 10. End of a Venture, End of a Dream? Walter Gropius, Konrad Wachsmann Published on: Apr 23, 2021 License: Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License (CC-BY-NC-ND 4.0) MIT Press Open Architecture and Urban Studies • The Dream of the Factory-Made House 10. End of a Venture, End of a Dream? General Panel: The Final Phase During 1947 General Panel, embarking on the great adventure of the Burbank factory, sought to present to the outside world a picture that stressed its positive achievements: the excellence of the design, the high standard of the production plant. Two major articles in the national architectural press, the Architectural Forum and Arts and Architecture, reinforced this favorable image and painted a highly encouraging picture of the immediate future and long-term prospects of General Panel.1 Attracted by the potential of General Panel, as it was perceived, and by the reputation of Gropius and Wachsmann, a press of highly qualified individuals, professionals who had formerly held office in the National Housing Administration, and architects with interesting backgrounds (one from the Bauhaus, another who had worked with Buckminster Fuller) offered their services to General Panel.2 But the optimistic picture was far from accurate. Although from time to time there had been articles probing the difficulties of the prefabrication industry,3 yet in discussing the work of specific designers, especially architects as celebrated as Gropius or Wachsmann, they showed a reluctance to go below the surface of the problem, to enter too deeply into fundamental issues. In presenting a review of General Panel, they relied too heavily on material provided and too little on an independent critical analysis. Moreover they failed to relate the specifics of General Panel to the broader issues, and especially to the question of economic constraints within which the prefabrication industry operated. In their understandable attempts to do justice to the obvious merits of the Packaged House, they obscured the fact that all was far from well within the organization.4 In part the problems were personal, generated by the division of responsibility resulting from the establishment of the new company, and the ambiguity of Wachsmann’s continued centrality to the project. He no longer had overriding control and differed strongly on several policy issues with the California directorate. As a case in point, the expedient of producing conventional floors and roofs, though undoubtedly making good sense economically, even technically, and intended only as an interim measure, caused Wachsmann great distress, as it detracted from that universality of the system which was, in a sense, its ideological justification.5 Then, he was interested in exploiting new materials and methods (metal framing, plastic cores) which technologically had become much more exciting for him,6 but although Southwell also 2 MIT Press Open Architecture and Urban Studies • The Dream of the Factory-Made House 10. End of a Venture, End of a Dream? advocated a shift to steel framing for the panels as a long-term move, the factory was irrevocably committed to wood. Wachsmann felt constrained and frustrated by what he saw as shortsightedness on the part of the administrators. They, in turn, though recognizing his undoubted genius,7 were impatient of his eagerness to step beyond the realities of the day. Wachsmann was always willing to supersede his own inventions with something newer and better; the rigors of economic necessity committed the California factory to the status quo of the system as originally designed. Indeed, it was the economic situation that now pressed most heavily on General Panel. Personal friction, philosophical disputes, could perhaps, with goodwill, be overcome. But the financial situation appeared threatening, almost desperate. The initial private investment and subsequent share issues, the mortgage from the War Assets Administration, the Reconstruction Finance Corporation’s loan, the sum total of these funds proved completely inadequate for the development and equipment of the lavish Burbank factory. General Panel had been one of the few of the larger prefabricating firms to have raised capital through public stock subscriptions and loans. As Burnham Kelly pointed out, of the better-known prefabricators, “many owed either their original formation or much of their capitalization to large industrial empires.”8 General Panel had no such backing, and without these large reserves of capital, production was held up throughout the second half of 1947 by lack of working funds. This difficulty in securing the necessary financing, it was later explained, resulted from “the expiration of insured manufacturing financing provisions of the National Housing Act.”9 The problem was twofold. The RFC loan was essentially short term and fell due, as Albert Wohlstetter explained, “before any substantial amount of manufacturing and constructing had been performed, and there was no means of repaying this debt from sales.”10 In addition the post-Wyatt interpretation that the marketing guarantee was valid for one year only failed to take into account the time necessary, in Wachsmann’s view, “to buy carloads of material, produce, sell, ship and erect 10,000 houses.”11 This complaint may have been justified, in principle; Gropius, more sober and realistic in his judgments, also expressed disappointment at the failure of the government bureaucracy to understand the nature of the processes of industrialized building and how they differed from conventional methods in timing and financing. “The General Panel Corporation is somewhat stuck,” he wrote in frustration to friends in Europe, “since the authorities are too backward and not geared for prefabrication. For that reason the financing of houses is very difficult to overcome.”12 Nevertheless, there were obviously other problems. It may have been impossible to produce 10,000 houses 3 MIT Press Open Architecture and Urban Studies • The Dream of the Factory-Made House 10. End of a Venture, End of a Dream? in the time available; but when Gropius was writing this letter, early in 1948, only fifteen houses had in fact been produced and sold, with a large number of incomplete sets of assorted panels also in stock.13 Among reasons for production delays were techical problems, due to the fine tolerances and high accuracy demanded by the system, and to running-in difficulties generated by the “rush to production.” Had time and circumstances permitted, it would obviously have been desirable to test the design and system in a pilot plant of limited production, before the final decisions on tooling the complete factory were taken.14 Sales were also going slowly, due not to resistance to the product per se, but rather to its high cost. This went against all predictions of the great savings to be made (15 percent “across the board”) by industrial production. But the hard fact remained that, until full production was achieved, materials costs were out of all proportion and the overheads (deriving from the expensive plant installation) prohibitive. Even Southwell’s “worst case” assumption, that initial production, until full volume was achieved, would have to be subsidized by the corporation and sold at cost, proved overoptimistic.15 The financial crisis came to a head at the end of 1947. To avoid bankruptcy, there was a complete reorganization of the board of directors and officers of the corporation, in February 1948.16 Carl Dahlberg resigned as president, and withdrew altogether from the affairs of the General Panel. Wendell had earlier resigned, and now Southwell also withdrew, effectively ending the direct Celotex connection. Albert Wohlstetter took over as president and general manager. He brought to his task a rich and varied background of industrial experience;17 in addition he had for five years been associated with the prefabrication industry, not only through his connection with General Panel of New York since 1944 but, indirectly, through his position as program director of the NHA. Konrad Wachsmann moved to California, on leave from the New York firm, and became vice-president. He was joined in this rank by Paul M. Fisher, who had served on the War Production Board (dealing with priorities in construction projects) and had then been chief of the Lumber and Plywood Section of the National Housing Agency, before joining General Panel in June 1947 as director of production and material control. With this reorganization of the administration of the corporation, a committee of creditors, who had anxiously met in January 1948, extended an opportunity for a recovery operation, by agreeing to a moratorium on debt repayment until 1 April 1948.18 Wohlstetter responded by undertaking to try and renegotiate the RFC debt repayment, as well as to reschedule the payments to the principal suppliers, and by this means to 4 MIT Press Open Architecture and Urban Studies • The Dream of the Factory-Made House 10. End of a Venture, End of a Dream? shore up the shaky financial structure, while looking again at the problems of production and marketing. In February 1948 production was diversified “to include contract milling, door production, manufacture of movie flats and a variety of other wood products.”19 There is, we suggest, an irony in this improvisation in the face of crisis, in a factory planned as a model of integration between product