For Dana Corp., an automobile parts manufacturer with a reputation as one of the best-managed companies in the United States, the recession was the same kind of sobering jolt that a car owner gets from a broken rear axle.

After years of galloping growth, the bottom suddenly fell out of one of the company's major markets, sales dropped like a rock, and Dana -- which had embraced continuity of employment and concern for its workers as part of its public creed -- was forced to shut down four plants and lay off a third of its work force.

"We're sorry it happened. We take the responsibility for being in that part of the market. It's our fault," Dana President Stan Gustafson told a recent seminar of liberal arts students sponsored by the Woodrow Wilson foundation.

In large part, Dana was the victim of heavy dependence on one market, the light-truck market. Although Dana had planned to diversify in a slow and orderly manner, sales were seductive, and the company had invested $50 million in additional equipment to expand production.

"Light trucks was a market that generated a lot of cash for us. How do you walk away from that kind of market?" asked one company official.

In fact, maybe no one could have read the signs soon enough to have avoided the debacle, according to Dana officials and others. "I don't think anyone could have called it," said Gustafson, and industry analysts agree that the events that shook Dana were generally unpredictable.

"They were heavy into four-wheel drive, pickup trucks and vans -- and the market just went," said Ed Daffron, assistant director of the United Auto Workers Dana department.

"In the garden, Christ said, 'My God, my God, why hast thou forsaken me,'" noted Gustafson. "If Christ was clairvoyant and he didn't know," how could others be expected to understand every turn? Dana's president asked.

If the numbers are temporarily sobering -- and they are -- Dana's basically rah-rah spirit appears to have remained intact.

Net income after tax in 1980 dropped to $95.7 million from $164.2 million the previous fiscal year. Earnings per share fell to $2.78 from $5.03 in 1979.

"We took a terrible shot in the profit column," Gustafson conceded. "But we didn't lose money. We're still solidly in the black." He added that the experience has been valuable for Dana managers, and has left the company trimmer and able to respond more quickly to events.

Even so, the setback hurt terrifically. "The people here are professional managers," said Gustafson. "They have to feel every bit as bad as the Houston Oilers when they lose. They're a professional team -- they train themselves to win, and our particular team hates to lose."

"But by the same token, do they give up? It's not a question of going into a corner and whimpering," he said. "One thing you can bet on is that we're still in the league. We'll be there in the next playoffs, and we'll be better for having dropped that pass."

The metaphors at Dana are as thick as locker-room air. But the company has done more than talk. A major program of diversification to minimize the company's dependence on any single market is well under way.

Back in 1973 corporate officials decided that the company should diversify. For the first several years, however, diversification basically meant moving into such related fields as automotive-parts sales and servicing. The sudden decline of the light-truck and four-wheel-drive market, for which Dana had become a major supplier of axles and other components, hastened diversification and sent the company farther afield.

"The change we are about to undergo is not a change in philosophy or tactic, but a change in pace."

That quote, a response by Dana Chairman Gerry Mitchell to a question in April 1980, decorated the multinational corporation's annual report for 1980. "Our sales to the truck industry will continue to grow, but we will reduce our dependence on this market because the balance of our company will grow much more rapidly," he said.

As part of the change, Dana has shifted from trying to identify new markets for the products it has manufactured to trying to identify expanding markets that it can serve.

In 1980 Dana acquired two insurance companies, two hydraulics companies and a producer of computer numerical controls, Omicron. At the end of the year Dana also acquired a savings and loan holding company.

"In 1976, 45 percent of all our sales were to GM or Ford. Last year it was 27 percent," said Gustafson. "We won't be happy about it until it's less than 10 percent, because that kind of dependence causes huge swings."

"They eventually expected to reduce their exposure, but the market did it for them," said Michael A. Ward, first vice president of Dean Witter Reynolds and an analysts who has followed Dana's fortunes closely.

"You can't forecast a period when production evaporates," said Ward, who said he considers Dana one of the best-managed companies around. When the crunch came, truck dealers sold off inventories rather than taking new production, he said. Between June 1979 and September 1979, inventories of class II trucks fell from 586,000 units to 196,000 units. That drop left manufacturers such as Dana idle.

The company's previous record -- an average growth rate of 15 percent a year until last year and a return on investment of between 18 percent and 20 percent until last year -- "was not all done with cheerleaders," said Ward. "They're hard-nosed businessmen. That was the first time I saw them stub their toes."

Ward said he expects the company to be back in step by the end of 1981 or the beginning of 1982.

Although Dana may recover, some of the laid-off workers never will get their jobs back, corporate officials concede. At least one of the plants they closed has been sold, and Dana's expansion in other directions means the company will be looking for another type of worker.

Some laid-off workers, however, have moved to other parts of Dana under the company's policy of giving first preference for jobs to displaced Dana workers. Dana is required to do so for UAW members under its contract with the union, but the company went beyond the contract to apply the principle to other workers, said union negotiator Daffron.

Dana gives a lot of lip service to what it calls its "people" policy, a collection of productivity incentives, job protection, promotion from within and other worker-oriented programs. Daffron says it also lives by the policy, for the most part.

Approximately 70 percent of the company's employes have bought stock under the company's stock option plan. Together they own about 10 percent of Dana's common stock. "If you can get people to be on layoff and ask to continue their stock purchases, you've got a pretty good thing going," said Dana's vice president for corporate affairs, Frank J. Voss.

The company also has something called the Scanlon plan in effect in 21 plants. Under the plan, which must be voted on by the workers in the plant to be adopted, workers share in a bonus pool generated from savings due to increased productivity or worker suggestions.

"They're a good company. They are people-oriented," Voss said. "They're followed their policy by doing everything they could to make sure people are working."

Although the four plants closed by the company were unionized, Daffron agreed with company officials that the closings simply reflected the collapse of certain markets, not any desire to get out of union plants.

In addition to preferential hiring, Dana launched special efforts at the closed plants to help displaced workers find jobs. Dana trained jobless workers in job-seeking skills such as writing resumes, sent other companies descriptions of the skills of available workers, made clerical help available to type resumes and offered financial counseling.

In Ecorse, Mich., where unemployment is about 20 percent, Dana set up an office with desks and telephones, purchased Standard & Poor's and Dun & Bradstreet directories for the information they could provide about potential employers, bought Sunday newspapers from all parts of the county for their classified advertisements and brought in equipment for displaced workers to use to search for information in the Michigan state job bank.

"I don't think anybody's kept tabs on what it cost," said Phil Murphy, who oversaw the re-employment efforts. "I have no idea, but I'll tell you -- I think the truth is it's multibucks. I think we would have done it no matter what it cost."

"The continuity of employment philosophy says that people have a right to a job and a right to be protected against the impact of the economy or plant closings," said Murphy. "We have a long way to go before we make this a reality, but I think establishing the philosophy is a big step."

The philosophy first was enunciated by Chairman Mitchell in 1978, before the recession.

"They have demonstrated, no question, that they are concerned about people," said the UAW's Daffron. "They say that they are 90 percent people and 10 percent profit. That's easy to say when the economy is high and you can live up to it.

"When the bottom falls out, the bottom line is profit," he said. "They're not in business to supply jobs; they're in business to make money."