When people hear the name International Harvester, they usually picture a famous red tractor working a field.
When we think of International Harvester, the image that comes to mind is often that iconic red tractor rolling across farmland. What many people forget is that this same company also built legendary Scout SUVs and capable Travelette pickups—before ultimately collapsing under the weight of billions of dollars in debt.
Its downfall combined nearly every flaw that plagued the American auto industry of the era. A company whose machines quite literally helped build the nation was undone from within by a chain of disastrous decisions, culminating in a six-month labor strike that cost billions and a public backlash over multimillion-dollar executive bonuses issued as the business was falling apart.
International Harvester’s century-long story didn’t begin with automobiles, but with agriculture. In the 1830s, inventor Cyrus Hall McCormick improved the horse-drawn mechanical reaper, revolutionizing harvesting. His company, McCormick Harvesting Machine Company, quickly became an industry leader.
In 1902, seeking to eliminate competition and boost profits, McCormick merged with four other manufacturers, including Deering Harvester Company. The deal was financed by none other than J.P. Morgan. The result was the International Harvester Company (IH).
IH’s first vehicle, the Model A delivery truck, arrived in 1907. It was a simple, rugged machine powered by a two-cylinder engine producing about 20 horsepower—designed for rural America. That truck marked the beginning of International Harvester’s life as an automaker.
By the 1920s, IH was thriving in both vehicle production and agricultural equipment. In 1938, it introduced the Metro delivery van, and in 1940 launched its first dedicated pickup lineup, the K and KB series. Over the next nine years, the company produced 49 different versions of these trucks with an astonishing 142 wheelbase options. They were lighter and simpler than competitors’ models, but perfectly suited for farm work.
The K/KB trucks were followed by the L series in 1949, the R series in 1952, and the S series in 1955. As IH pushed deeper into the medium- and heavy-duty truck markets, the late 1950s and 1960s became its golden era.
In 1957, IH introduced the Travelette—the world’s first mass-produced pickup with a second row of seating, a clear predecessor to today’s crew cab trucks. Soon after came the Travelall SUV, created to take on the Chevrolet Suburban head-on.
The true icon, however, arrived in 1960 with the International Scout 80. Designed to compete with the Jeep CJ, this simple, tough off-roader—with its fold-down windshield—did far more than match its rival. The Scout helped define an entirely new market segment: compact, two-door SUVs with enclosed bodies. Later, vehicles like the Ford Bronco and Chevrolet Blazer would follow its path.
The Scout remained largely unchanged for nearly two decades before being replaced by the Scout II (1971–1980). The second generation became a cult favorite thanks to its boxy styling, available V8 engines, and special editions like the Rallye and SSII.
Market success, however, did not translate into financial health. As early as the 1960s, profits began to shrink dramatically despite steady sales. The root cause was a management crisis.
IH expanded aggressively into new areas without sufficient investment or effective leadership. Its internal culture didn’t help either: promotions were often based on seniority and personal connections rather than competence. As a result, key roles were frequently filled by people ill-suited to lead. The foundation began to crack.
By the mid-1970s, International Harvester’s financial problems had reached a breaking point. In 1977, the board hired an outsider to turn things around: Archie McCardell, a highly regarded executive from Xerox. His reputation for boosting profitability came with an eye-watering salary at IH.
At first, McCardell’s aggressive cost-cutting appeared to work. Short-term profits improved, though they still lagged far behind competitors like Caterpillar. But his approach soon made matters worse.
McCardell paid himself $460,000 a year, approved massive bonuses for executives, and abruptly shut down entire business units. Most damaging of all, he took a confrontational stance toward labor and pushed through large-scale layoffs.
The breaking point came in 1979, when IH demanded concessions from the United Auto Workers (UAW) on shifts and overtime, claiming existing rules were costing the company $1.3 billion. Negotiations collapsed due to management’s lack of experience dealing with unions. Morale cratered, and tensions exploded.
In November 1979, McCardell received a $1.8 million bonus. The very next day, 35,000 International Harvester workers walked out. The strike lasted 172 days, becoming one of the longest and most destructive in U.S. industrial history.
The damage was catastrophic. IH lost hundreds of millions in revenue and relied heavily on short-term loans to survive. By 1981, its debt had ballooned to $4.5 billion. Investor confidence vanished.
Even then, the board forgave McCardell’s $1.8 million personal loan in 1980 and approved an additional $6 million bonus package for top executives in late 1981—while workers faced wage cuts. Trust was completely shattered. In May 1982, McCardell “resigned,” but by then the damage was irreversible.
International Harvester could not be saved. In 1985, the company officially ceased to exist. Its storied name and product rights were sold off, and its assets were liquidated to cover debts.
Tenneco acquired the agricultural equipment business and soon merged it with J.I. Case, creating the Case IH brand that still exists today. IH’s truck operations and renowned diesel engines—such as the legendary DT466—went to Navistar International.
In 2020, Volkswagen Group fully acquired Navistar, and by 2027 plans to revive Scout as a brand focused on electric SUVs and pickup trucks.
What remains in history’s scrapyard is more than just a red tractor. International Harvester’s story stands as a warning: unchecked executive greed, short-term thinking, arrogance, poor leadership, and a complete disconnect from the workforce can destroy even the mightiest industrial empire.