For use in the Avanti, several high-performance modifications were utilized. The Avanti engine was available in four versions named the R-1, R-2, R-3 and R-4. They were based upon a 232-cubic inch V8 Studebaker engine that produced 120 horsepower (89 kW) when introduced in 1951. By 1963 the Avanti version of this engine, the R-1 289, produced 240 horsepower (179 kW). The optional R-2 version with its Paxton supercharger produced a rated 289 horsepower (216 kW), or one per each cubic inch of engine displacement. Studebaker's "Jet Thrust" 289 V8s were significantly more powerful than any naturally aspirated 289 production engine offered by Ford through 1967 (in 1968, Ford began relying on the new 302 cubic-inch engine).
Studebaker had first used Paxton superchargers on the 1957 and '58 Studebaker and Packard Hawks. Subsequently, they bought the company. With the assistance of car racing legend Andy Granatelli, Studebaker developed an R-3 and an R-4 engine for the Avanti. The first R-3 was a 289 was bored initially to 299. Later versions were 304.5 cubic inches (just under the class-C five-liter limit). The R-3 employed special cylinder heads with much larger intake ports and larger valves, an aluminum intake manifold with correspondingly larger ports, long-branch lower restriction exhaust manifolds, longer-duration camshaft, and a Paxton supercharger blowing through a Carter AFB four-barrel carburetor mounted in a pressurized aluminum box. The R-3 was rated at 335 horsepower (250 kW), but reportedly produced 411 at the flywheel.
The R-4 engine was essentially the same as the R-3 engine except that it incorporated domed pistons for a higher compression ratio and a dual four-barrel manifold with two Carter AFB carbs. The R-4 was rated at 280 horsepower (210 kW).
On December 9, 1963, Studebaker announced the end of car and truck manufacturing in South Bend, and the consolidation of all vehicle manufacturing in its Hamilton, Ontario, Canada plant. At that point, the company dropped the Avanti, the Gran Turismo Hawk, and all pickups and trucks in order to focus on sedans, coupes and station wagons. Only 4,643 Avantis had been produced by the time Studebaker closed the South Bend factory on December 20, 1963.
The final Avanti, a white fully optioned R-3 car, contained a letter signed by Studebaker employees advising the future owner of the car's significance under the carpeting near the spare tire well. Studebaker survived another two years by assembling Commanders, Daytonas, Wagonaires and Cruisers at Hamilton that were equipped with 230-cubic-inch six-cylinder and 283-cubic-inch V8 engines sourced from GM Canada LTD (that were based on contemporary Chevrolet engines), but the thrill was gone. Studebaker ended automobile production on March 17, 1966.
Following the closure of the South Bend operation, two South Bend, Indiana Studebaker dealers, Nate Altman and Leo Newman purchased the Avanti name, the body molds, remaining parts, tools, jigs, and a portion of the South Bend factory to continue making the Avanti. Altman and Newman had first approached the Checker Motors Company, maker of the iconic Checker Marathon and taxi cab, about taking over production. However David Markin, Checker's President reportedly stated that his company was not interested in building "an ugly car" like the Avanti. These Avantis, called the Avanti II, were given a 327 in³ (5.4 Ltr) Chevrolet Corvette engine and were meticulously hand-built to order in very small numbers. The Avanti II's engine evolved from the 327 to the 350, the 400, and finally the 305. All Avanti IIs were built on Studebaker chassis until 1987. The 1987-89 models were based on GM's G-platform specifically the Monte Carlo.
On October 1, 1982, real estate developer Stephen H. Blake bought the rights to the Avanti II. Steve Blake made some updates to the car, notably the change to plastic, integrated bumpers and a redesigned dash and interior (introduced on a limited production run of "20th Anniversary" cars, but continued on for subsequent production) and also introduced a convertible model. At that time the "II" was dropped from the name, although the car remained substantially the same except as previously mentioned.
Blake's company declared bankruptcy in 1986, and the company was purchased by Michael Kelly, who relocated production to Youngstown, Ohio. In September of 1988, Kelly sold his interest in the company to a major investor, J.J. Cafaro, a shopping center developer from Youngstown. Production fell with the demise of the G-platform and subsequent concentration of production on the four-door model a.k.a. "Luxury Touring Sedan," which was based on the Chevrolet Caprice chassis. By 1991, production of the Avanti II had fizzled out, and a fire in 1992 put the final nails in the coffin.Source: Wikipedia.