The Anglo-French STD (Sunbeam-Talbot-Darracq) combine collapsed in 1935. The French Talbot company was reorganised by Anthony Lago (1893-1960) and after that, the Talbot-Lago name was used but on the home market the cars bore a Talbot badge.
At the same time, the British interests of Talbot were taken over by the Rootes Group and the parallel using of Talbot brand in France and Britain ended. Talbot-Lago cars sold in Britain were badged as Darracq.
Lago was an excellent engineer, who developed the existing six-cylinder engine into a high-performance 4-litre one. The sporting six-cylinder models had a great racing history. The bodies—such as of T150 coupé—were made by excellent coachbuilders such as Figoni & Falaschi or Saoutchik.
One of the immediate post-war cars that received notoriety for its speed was the T26 Grand Sport (GS). It was built for either racing or luxury and benefited directly from Talbot's successful T26C Grand Prix car. As such it was expensive, rare and helped Louis Rosier win the LeMans 24 Hour race. The GS replaced the Lago-Record chassis which was named for its remarkable top speed. Having a 4.5 liter inline-6 aluminum cylinder head and triple carburetor fuel feed from the T26 the Grand Prix cars, the GS was one of the world's most powerful production cars. It produced 190 bhp which was good for around 125 mph depending on the body that was fitted. Chassis details were similar to the Grand Prix cars, but it was longer and wider. It came it two wheelbase lengths -104 and 110 inches. Later Lago America models (1957-1959) used 2.6 or 2,7 litre BMW engines or Simca engines.
Postwar government taxation policies savagely discouraged the sale in France of passenger cars with engine sizes above two litres: despite its high quality cars, Talbot-Lago struggled for survival along with other pre-war marques such as Hotchkiss, Delahaye, and Lagonda and production ceased when Simca took over during 1959. (Simca was subsequently taken over by Chrysler, who gained a controlling share in 1963, and rebranded the business as Chrysler France in 1970).
Talbot-Lagos have become a top-prized car at various auctions, fetching as much as $3.685 million at the 2005 Pebble Beach Auction for a 1938 T150-C Lago Speciale Teardrop Coupe. The same year, the top bidder at a Christie's auction was awarded a 1937 Talbot-Lago T150 C-SS Teardrop Coupe with coachwork by Figoni and Falaschi for his $3.535 million-dollar bid.