kscarbel2 Posted July 3, 2019 Share Posted July 3, 2019 David Phillips, Automotive News / July 2, 2019 Lee Iacocca, the mastermind behind the Ford Mustang and the straight-talking captain of Chrysler’s historic U.S. rescue and 1980s turnaround that brought him acclaim as America’s most famous CEO and car salesman, died on Tuesday at home in Bel Air, Calif., a neighborhood in western Los Angeles. He was 94. The death was reported by The Washington Post, which cited Iacocca's family. The cause was complications from Parkinson’s disease. Iacocca, a natural huckster and tireless competitor with Italian roots and a penchant for cigars, vinyl car roofs and Greek-temple grilles, defined the role of the imperial American executive -- first as president of Ford Motor Co., then as chairman and CEO of Chrysler -- for much of the last quarter of the 20th century. With a sometimes brash, no-nonsense style and fiery tongue, he was the towering public face, corporate pitchman and voice for the American auto industry’s triumphs and challenges. “I think America is getting an inferiority complex about Japan,” Iacocca lamented before a group of Chrysler executives in one late 1980s TV commercial. “Everything from Japan is perfect. Everything from America is lousy ... now that’s got to stop.” Doug Fraser, the late UAW president and Chrysler director, once pegged Iacocca “a hip shooter deluxe.” Newsweek, in a 1963 profile, said he could be as “direct as the thrust of a piston.” Playboy called him "a businessman of the old school, a guy who smells the territory and goes with his gut." Fierce competitor In the early 1980s, with the U.S. auto industry on its heels amid soaring gasoline prices, inflation and rising Japanese imports, Iacocca’s optimism and fierce competitive spirit helped revive Chrysler and renew Detroit’s fortunes. “The most amazing thing about the guy is that he just never gives up,” the late Ben Bidwell, a longtime Ford executive and later Chrysler vice chairman, once said of Iacocca. “Every day he gets up and every day he attacks. You get discouraged yourself. But he just never, never, never gives up on the company, on its products, on whatever.” Iacocca was hailed as “Detroit’s comeback kid” in a March 1983 cover story in Time. Two years later, when asked to name the person they most admired for a 1985 Gallup Poll, Americans ranked Iacocca third -- behind President Ronald Reagan and Pope John Paul II. The next year, Iacocca placed second in the survey, behind Reagan and ahead of the pope. At the end of his storied automotive career, spanning the late 1940s to the early 1990s, Iacocca admitted what many colleagues had already discovered: He was better at managing and leading during turbulent times than good. “I’m built that way,” Iacocca told the Associated Press in December 1992, the month he retired from Chrysler. “Some guys fight better with real ammunition … on maneuvers they goof off. My adrenaline flows when you’re really in the trenches and things are tough.” Risky gamble on pony car Iacocca’s keen product planning skills were behind Ford’s risky gamble, soon after the Edsel flop, to bring the Mustang to market in 1964. The first so-called pony car, with its low price and sleek styling, was an instant sensation and gave a new generation of young Americans another reason to fall in love with Detroit metal. With just $45 million to develop and build -- what he called "an unheard of low amount at the time to design and push a new car line through to production" -- the overnight success of the Mustang put Iacocca on the fast track at Ford. “Few people understood the sizzle that existed between the car and a driver better than Lee Iacocca,” historian and author Douglas Brinkley observed in his 2003 book, Wheels for the World: Henry Ford, His Company, and a Century of Progress. Iacocca’s second home run, the minivan, was an innovative people hauler that spawned a new segment in the 1980s, became one of the most profitable consumer products ever created, inspired a raft of copycats and helped Chrysler reap billions of dollars in sales for decades. The design was inspired by a former colleague at Ford, Hal Sperlich. “He could sell you anything and back it up with his sales talk, logic and facts,” the late William Clay Ford Sr., grandson of Ford founder Henry Ford and a longtime Ford executive and director, once said of Iacocca. “He is an extraordinary salesman, an extraordinary talent.” The Chrysler years Chrysler was hemorrhaging cash and careening toward bankruptcy when Chrysler Chairman and CEO John Riccardo hired Iacocca to become president and COO of the company on Nov. 2, 1978. The same day, Chrysler reported nearly $160 million in third-quarter losses -- a staggering pile of red ink for an automaker and a company record at the time. While he had just been fired months earlier as president of Ford Motor Co. by Henry Ford II, in one of the Motor City’s most acrimonious splits, Iacocca was quickly embraced as Chrysler’s savior. “It’s a coup, and a good one, and we thank Henry Ford II for it,” a dealer told Automotive News the week Iacocca joined Chrysler. Less than a year later, Riccardo, exhausted by efforts to secure a government bailout, abruptly retired and Iacocca became chairman and CEO of Chrysler on Sept. 20, 1979. In a 1992 interview with Automotive News, Iacocca said the situation when he arrived at Chrysler was far worse than he had expected. “I knew it was bad, but I didn’t know that bad,” he said at the time. “What I didn’t know was how rotten the system was. How bad purchasing was. How many guys were on the take. How rotten it was to the core. That stunned me.” U.S. loan guarantees With Chrysler’s financial woes mounting and bankruptcy looming, Iacocca successfully lobbied President Jimmy Carter and Congress in late 1979 and early 1980 to obtain a $1.5 billion loan guarantee from the federal government. In return, Chrysler came up with $2 billion in cost reductions. The controversial rescue backed by the federal government was unprecedented for the auto industry and American business at the time. Iacocca worked tirelessly to secure it. He enlisted Chrysler dealers from around the country to lobby their local representatives. “We set up a war room and had every [congressional] district in the 50 states covered,” Iacocca recalled in 2006. “We got the leading dealer in each district” to organize the effort. To secure the loan guarantee, the company needed to raise $1.4 billion. Iacocca oversaw a series of drastic cost-saving measures -- “equality of sacrifice,” he called it. On Oct. 25, 1979, Chrysler and the UAW reached a tentative contract agreement that gave the union a seat on the company’s board of directors. In return, Chrysler was granted $203 million in concessions by the union. Altogether, nonunion Chrysler employees swallowed $125 million in pay cuts; suppliers and dealers threw in $180 million; states and cities with Chrysler plants chipped in $250 million and the UAW accepted $462.2 million in concessions. Iacocca, setting an early example of sacrifice, had reduced his salary to $1 a year. Pitchman supreme Over time Iacocca gutted Chrysler’s senior management team, recruited former Ford colleagues and hired a few star outsiders to remake the company. He scuttled the company’s archaic sales bank that saddled dealers with unwanted inventory and instituted dealer and consumer rebates. Iacocca’s first commercial plug for Chrysler came in a 1979 print ad. It featured Iacocca’s signature below a 1,052-word statement in which he presented the company's sweeping case for federal loan guarantees. His commercial TV debut came later that year in an appearance at the end of conventional spots that pitched models such as the Plymouth Horizon. “I'm not asking you to buy any car on faith,” he said. “I'm asking you to compare.” After Chrysler secured the loan guarantees, Iacocca moved into a starring role in the company’s marketing. America had given Chrysler some “breathing space,” he bellowed in one commercial, adding: “Now watch us go.” The introduction of the front-wheel-drive, four-cylinder K cars in 1980 fueled the automaker’s rebound, eventually generating billions in revenue and profits. Iacocca had first tried to market such cars in the 1970s while at Ford. It was a high-stakes gamble. Iacocca played a minor role in the development of the K cars but he was charged with making sure they were a success. “At Chrysler, the K-car was the last train in the station,” Iacocca wrote in his 1984 autobiography, Iacocca: An Autobiography. “If we failed here, it was all over.” He took to the airwaves again in 1981 to tout the K cars’ fuel economy, value and roominess. After a slow start, the company sold more than a million Dodge Aries and Plymouth Reliant cars in the first few years -- enough to generate cash to develop other models. Chrysler repaid its loans in August 1983 -- seven years ahead of schedule -- in a feat celebrated by Iacocca at the Waldorf Astoria hotel in New York. A year later, Iacocca was behind the lectern again to introduce a radical vehicle that would define the company for decades. The minivan In the early 1970s, Sperlich, then a vice president at Ford, proposed the minivan, but was spurned by Ford CEO Henry Ford II. After Sperlich left for Chrysler in 1977, soon to be followed by Iacocca, the idea for a minivan finally took off. Iacocca, recognizing the American family’s need for fuel economy, roominess, comfort and function at a modest price, had long believed the minivan would be a success. “You can say what you want about Iacocca, but he has very good marketing instincts, and he could see the potential for this kind of vehicle,” Sperlich said in a 1999 interview with Automotive News. “We had done extensive market research and found out there were people who liked it from all walks of the automobile kingdom.” Advanced engineering on the minivan started the week Iacocca joined Chrysler, Sperlich said. The success of the Plymouth Voyager and Dodge Caravan minivans was built on the earlier triumph of the K-car platform with fwd and a four-cylinder engine. The vehicles were fuel efficient and big enough to seat six people. Iacocca was convinced there was a market for such a van with a low step-in height and what he called “garageability.” The Voyager and Caravan, introduced in 1984, became two of the hottest new products of the 1980s. Household name By the mid-1980s, Iacocca was a household name, appearing regularly in commercials to tout Chrysler’s lineup, often taking shots at Japanese rivals and daring U.S. consumers to buy a rival car if they could land a better deal. With the 1982 Chrysler LeBaron, Iacocca hatched what became a signature pitch: “If you can find a better car, buy it.” In another 1982 ad, Iacocca argued that if everyone drove a fuel-efficient K car, “we wouldn’t have to import a single drop of OPEC oil for gasoline.” Iacocca’s 30-second spots reached 97 percent of American households an average of 63 times apiece, Time magazine reported in 1985. He was lampooned by comedian Phil Hartman on NBC’s “Saturday Night Live” and became a frequent cartoon subject in comic strips and the editorial pages of the nation’s newspapers. People magazine anointed him the new Italian Stallion -- a sex symbol for the Corporate Age. His name was tossed around as a possible presidential candidate. At one point, Iacocca tried to dampen the speculation by suggesting noted sex counselor Dr. Ruth Westheimer would be an ideal running mate. “We’d make a terrific ticket,” Iacocca quipped in 1987. “I’d tell them what to do and she’d tell them how to do it.” He turned down an appointment to a U.S. Senate seat for Pennsylvania and was courted to become Major League Baseball commissioner by George Steinbrenner, the late owner of the New York Yankees. Best-selling author President Reagan in 1982 appointed Iacocca head of the Statue of Liberty-Ellis Island Foundation created to help raise funds for the renovation and restoration of the landmark statue in New York Harbor. Iacocca: An Autobiography, lived on The New York Times bestseller list for 88 weeks. The book was an overnight sensation and proved popular in all social strata and in all regions of the country. Sales topped 200,000 copies per month in Japan and it became a must-read among “the Saudi technocratic elite,” Time magazine said. In its review of the book, The Wall Street Journal called Iacocca the “Motor City’s most famous motor mouth.” Iacocca would write two more books: Talking Straight in 1988, and 2007’s Where Have All the Leaders Gone?, in which he railed against excessive executive compensation, political gridlock in Washington, the competitiveness of the Detroit 3, why America couldn’t build a competitive hybrid and other hot topics of the day. Spending spree With Chrysler on the mend -- it posted record profits of $2.38 billion in 1984 and $1.64 billion in 1985 -- Iacocca hatched plans to build a modern technology center 30 miles north of Detroit, in Auburn Hills. The $1 billion project opened in 1991. Chrysler also went on a spending spree, snapping up Gulfstream Aerospace Corp., FinanceAmerica, Electrospace Systems, Lamborghini and a major prize, American Motors -- including AMC’s profitable Jeep brand -- for a combined $2 billion. Iacocca aimed to diversify Chrysler’s revenue sources and help shield the company from future economic downturns. But the acquisitions raised the automaker’s breakeven point and, combined with several poor product calls, produced another period of losses for Chrysler. With the company back on the ropes, Iacocca was forced to sell assets to raise cash and focus on Chrysler’s core automotive operations. In a 1995 speech, Chrysler President Bob Lutz said Chrysler’s crisis in the late 1980s was almost as dire as the one that required Iacocca to secure the government-backed loans a decade earlier. “We had sort of put our product development on autopilot, which resulted, as you know, in a string of bland, look-alike cars and trucks,” Lutz said. Bashing Japan Fresh models such as the compact Neon, revamped minivans, a redesigned Ram pickup and the new Jeep Grand Cherokee helped right Chrysler once more and the profits started flowing again in the early 1990s. Still, Detroit automakers continued to battle Japanese automakers and lose U.S. market share, and Iacocca never passed up a chance to champion Detroit’s cause. He was particularly vocal in a speech after returning from a historic trade mission to Japan with President George H. W. Bush and U.S. business leaders in January 1992. “I for one am fed up hearing from the Japanese, and I might say some Americans, too, that all our problems in this industry, all our problems, are our own damn fault,” a vitriolic Iacocca told the Detroit Economic Club. “We do not have idiots running General Motors, Ford and Chrysler, or our suppliers. And our workers are not lazy and stupid.” Time to go A few months later, with Iacocca’s reign at Chrysler winding down -- he had turned 65 in 1989 -- he faced mounting pressure from some company directors to identify a successor. Iacocca stayed on longer than Chrysler’s traditional retirement date to, as he put it, finish the job when the company’s fortunes soured again in the late 1980s. Chrysler had begun to lose top executives such as Gerald Greenwald and Steve Miller when directors realized Iacocca had no plans to step down. The board, worried about Wall Street’s growing concern with Chrysler’s succession plans, began to realize that Iacocca really didn’t want to retire, Newsweek reported in March 1992. After considering insiders and outsiders, including Roger Penske, Iacocca personally chose veteran GM executive Robert Eaton to succeed him, a selection Iacocca later regretted in his 2007 book on leadership. Iacocca retired as chairman and CEO of Chrysler at the end of 1992 at age 68. In typical Iacocca fashion, his retirement became an extravagant road show -- a monthslong affair, with farewell parties in Washington, Las Vegas, Paris, New York, Detroit and Palm Springs, Calif. The guests in Vegas at the University of Nevada arena included former U.S. House Speaker Tip O’Neill and entertainers Frank Sinatra, Vic Damone and Wayne Newton. For a farewell dinner at the Greenbrier resort in West Virginia, gold-lame napkins were flown in from Illinois. Guests received a crystal paperweight in the shape of the Chrysler pentastar and engraved with Iacocca’s autograph. In one of his last TV spots as chairman, Iacocca introduced Americans to another new styling concept -- what Chrysler called “cab forward,” in which the wheels of a car are pushed out to the corners of the vehicle and the cabin is expanded. It was featured prominently on a new generation of large sedans: the Chrysler Concorde, Dodge Intrepid and Eagle Vision. “Well, it’s here. ... It’s time for me to step down and retire as chairman of Chrysler … ” Iacocca boasted in the ad. “You know, I’ll tell you, when it’s your last turn at bat, it sure is nice to hit a home run.” Italian roots Lido Anthony Iacocca was born on Oct. 15, 1924, in Allentown, Pa. His parents were Italian immigrants who helped operate a hot dog restaurant, Yocco’s Hot Dogs. Iacocca’s father, Nicola, made and lost a fortune more than once while starting a car rental agency and investing in real estate, a movie house and fast-food restaurants. In school, Iacocca was popular and smart, but could also be brash and quick-tongued. In third grade, he walked onto the stage in a play in the lead role as king while chewing stick gum that a girl had handed to him offstage. He received a lowered grade on a report card as a result of the incident and was punished severely by his father. In 10th grade, Iacocca contracted rheumatic fever and was forced to give up sports and instead embraced reading and joined the debate team. He graduated from Allentown High School in 1942 and went on to graduate from Lehigh University in Bethlehem, Pa., with a degree in industrial engineering in 1945. He earned a master’s degree in mechanical engineering from Princeton University in 1946 and joined Ford as an engineering trainee that same year. Iacocca lasted only nine months as an engineer; he became disenchanted during Ford’s tough “Rouge Loop Course,” in which trainees learn the basics of car manufacturing. He was assigned a job as an automatic transmission engineer but turned it down. “I learned at Princeton that pure research did not fascinate me,” he told Time magazine in 1964. He left engineering and began his career in sales and marketing at Ford’s Chester, Pa., district sales office. “I was eager to be where the real action was -- marketing or sales,” Iacocca wrote in his autobiography. “I liked working with people more than machines.” He became a Ford zone manager in Wilkes-Barre, Pa., in 1949. Iacocca met his first wife, Mary, then a receptionist at Ford’s Philadelphia office, in 1948. They married in 1956 and had two daughters, Kathryn and Lia. Mary died of diabetes in 1983. Iacocca would marry two more times. He wed publicist Peggy Johnson in 1986, but the couple divorced eight months later. Johnson died in 2000 of a heart attack. Restaurateur Darrien Earle became Iacocca’s third wife in 1991. The couple divorced in 1995. Young Turk at Ford Iacocca began his meteoric rise to the top of Ford in 1956 when he introduced the “56 for ’56” campaign. With a 20 percent down payment, customers could purchase a 1956 model Ford for $56 per month for three years. The marketing concept was a success, and by 1960 Iacocca was elected a vice president and chosen general manager of the Ford Division. He was just 36 at the time and the youngest person ever to oversee the giant Ford Division. Only Henry Ford II, it was often said, advanced faster through the ranks at Ford. Iacocca later described his years heading the Ford Division as one of the happiest periods of his career. He was eager to develop a sporty, moderately priced vehicle to tap into the youth-oriented culture that was beginning to flourish after the somnolent 1950s. The Baby Boomers were moving into prime car-buying age. When the Edsel was dropped in 1960 after just its third model year, and $250 million in losses, many Ford officials, notably chairman and CEO Henry Ford II, were reluctant to approve the Mustang project. But Iacocca -- who didn’t design or style the car -- pressed on and eventually won approval for the project with an original price tag of $75 million that was whittled down to $45 million. Iacocca created a clandestine group of engineers -- dubbed The Fairlane Committee after the Dearborn, Mich., inn where they met secretly -- that set several broad goals for the car. It had to seat four passengers. It needed a generous-sized trunk. The hood had to be long to suggest a powerful engine, while the rear deck should be short – to underscore lithe and speed. The Mustang proved a revolutionary vehicle when it debuted in April 1964. In a marketing coup, Iacocca appeared on the cover of both Time and Newsweek the week the car came out. “Lee sensed how big the Mustang’s potential could be sooner than anybody,” Donald Petersen, who worked as a liaison between the Mustang’s engineering and marketing teams, and who later became Ford chairman and CEO, told Automotive News in 2003. “He really went for it. He never gave up.” Some 1 million Mustangs were sold in the car’s first two years of production -- the quickest a new nameplate had ever achieved that milestone. In 1989, AutoWeek wrote that “the two cars that have most influenced the shape and design of products worldwide in the last half of this century have been the Mustang and the minivan.” The Mustang’s success won Iacocca one promotion after another in the 1960s, culminating in 1970 when he became president of Ford. Miscues, too In addition to the Mustang and minivan, Iacocca’s other hits include the Cougar (the Mustang’s cousin at Mercury), Lincoln Continental Mark III, Ford Maverick and Jeep. With a convertible version of the Chrysler LeBaron, Iacocca revived the soft-top market after it went dormant in the 1970s. Despite his reputation as a product genius, Iacocca also stewarded some of the industry’s biggest product flops, notably the TC by Maserati, a car marketed by Chrysler in the 1980s. He also missed an opportunity in the 1960s that would have made Ford the first Detroit automaker to sell a fwd car in the states -- ahead of GM and Chrysler -- when he scrapped plans to market the Cardinal, which Ford had developed in Germany and proved to be a big seller across Europe. Under Iacocca, Chrysler also created the Eagle brand -- a vestige of the AMC deal -- but it was dropped after the 1998 model year. In 1988, Chrysler and Fiat signed a pact that allowed Chrysler to sell Alfa Romeo vehicles in Canada and the United States. The distribution deal was scrapped in 1991. At Ford, Iacocca was an early and vocal opponent of passive safety systems such as airbags only to actively embrace them later to help distinguish Chrysler’s products. And in 1987 he was forced to apologize publicly to American consumers after Chrysler was indicted for odometer tampering. “The first thing was just dumb,” Iacocca said candidly in July 1987 after Chrysler admitted it had disconnected odometers as part of routine product testing near a St. Louis assembly plant. “We test-drove a small percentage of our cars with the odometers disengaged and didn't tell our customers. The second thing, I think, went beyond dumb, and reached all the way out to stupid -- a few cars were damaged in testing badly enough that they should never have been sold as new. Those are mistakes we will never make again. Period.” The company was fined $120 million. The Pinto: ‘Lee’s car’ Iacocca also was responsible for the ill-fated Ford Pinto. He rushed the Pinto through production because, he was convinced, Ford needed an inexpensive subcompact car to compete with the small imports making inroads in the U.S. in the early 1970s. The Pinto quickly became known as “Lee’s car.” He demanded that it weigh no more than 2,000 pounds and sell for $2,000. Ford, under pressure from safety advocates and facing numerous lawsuits, recalled the Pinto in 1978 because the design of the fuel tank made it vulnerable to explosion after a rear-end collision. Mother Jones, in a 1977 article, had first reported that Ford knew about the issue with the Pinto’s fuel tank but continued to produce the car anyway. In his autobiography, Iacocca denied negligence by Ford. “There’s absolutely no truth to the charge that we tried to save a few bucks and knowingly made a dangerous car,” Iacocca wrote. “The auto industry has often been arrogant, but it’s not that callous.” In the end, Ford recalled 1.5 million Pintos. The automaker was the subject of more than 100 lawsuits because of the Pinto and paid millions of dollars in restitution. Battles with the Deuce Iacocca was president of Ford from 1970 until he was fired on July 13, 1978, by Henry Ford II after 32 years at the company. He was just the latest to join a famous fraternity -- the long list of men such as Ernie Breech, John Dykstra, Arjay Miller and William "Bunkie"Knudsen -- who climbed to a top post at Ford only to be pushed aside by a mercurial Henry Ford II. Ford and Iacocca regularly clashed over product plans, executive appointments, spending priorities and other strategic matters. Iacocca spent years building a power base at Ford -- often keeping track of subordinates and product ideas in a little black book. He appointed executives he knew would support him and his programs. "In terms of everything that really counted," Iacocca wrote in his autobiography, "I was more important than Henry." “Personable and tough, fun but aggressive, Iacocca did not so much arrive at the president’s office at Ford as wrap it around himself,” historian Douglas Brinkley wrote in Wheels for the World. In 1975, Henry Ford II launched an investigation to determine if there was any wrongdoing on the part of Iacocca. And in one of his final moves to undercut Iacocca, Ford created a three-person office of the chief executive in 1977. Ford was chairman and chief executive; Iacocca was named president and COO; and Philip Caldwell, formerly head of Ford’s international operations, became vice chairman. But Ford, in a memo that riled Iacocca, decreed that the vice chairman would act as the chief executive in the absence of the chairman. “It was a real crack in the face,” Iacocca wrote in his autobiography. “Every time there was a dinner, Henry hosted table one, Caldwell hosted table two, and I was shoved down to three. It was public humiliation, like the guy in the stockade in the center of town.” Iacocca told Automotive News in July 1978 that he was canned because Henry Ford II didn’t “want strong guys around.” Ford dismissed Iacocca to prevent him from becoming the company’s CEO, Ford later said in an interview before his death in 1987. “I didn’t want him around simply because I didn’t want him to be chief executive of the Ford Motor Co.,” Ford said. “My standards are higher than that.” Ford added, “There are lots of reasons I let (Iacocca) go. One of them is he’s not really a good chief executive. Not from a broad viewpoint. Secondly, he’s too conceited, too self-centered to be able to see the broad picture.” ‘An audacious plan’ In his autobiography, Iacocca wrote that Ford fired him simply because he didn’t like him. “I wanted to force him to give me a reason because I knew he didn’t have a good one,” Iacocca wrote. “Finally, he just shrugged his shoulders and said: ‘Well, sometimes you just don’t like somebody.’” Iacocca crafted what authors Peter Collier and David Horowitz called in their 1987 book, The Fords: An American Epic, “an audacious plan not just to survive at the company but to prevail” that entailed lobbying outside directors to keep his job. In his 1990 book, Henry: A Life of Henry Ford II, Walter Hayes, the former vice chairman of Ford of Europe and one of Henry Ford II’s closest confidants, wrote that Iacocca tried to oust Henry Ford II by suggesting he was senile and no longer able to run the company. Iacocca denied the claims in Hayes’ book. Franklin Murphy, former chairman of Times Mirror Co. and a Ford director at the time, told The Los Angeles Times in 1990 that he was convinced Iacocca tried to make a pre-emptive strike against Henry Ford by going to the board to oust Ford. Corporate fat cat Over time, Iacocca -- once a symbol of self-sacrifice for accepting only $1 a year to help rescue Chrysler -- came to personify the trappings of corporate America and Detroit’s longtime excesses. Early in his career, he could be so stingy at times that he would bring light bulbs home from the office so his wife wouldn’t have to buy any. More than once during his high-profile career, Iacocca found himself defending his pay and stock options, notably among journalists from Japan, a frequent subject of Iacocca’s rants over trade policy and where executive compensation is far more modest. His reputation took a big hit in 1988 after Chrysler decided to close a longtime American Motors plant in Kenosha, Wis., eliminating more than 5,500 jobs. Every Democratic presidential candidate that year blasted the move. Sen. Al Gore Jr., D-Tenn., ahead of Wisconsin’s April 1988 primary, pointed out in an ad that featured a smiling Iacocca that the Chrysler CEO “made $20 million in 1986.” In a May 2, 1988, cover story, Business Week called Iacocca -- America’s highest paid executive in 1986 and second-highest the next year -- the most overpaid executive while delivering shareholders the least “bang for the buck” of any corporate leader in 1987. Iacocca's retirement package -- he dreamed of matching the power and status of Henry Ford II -- became the subject of intense negotiations with Chrysler's board of directors. Even as his retirement neared, Iacocca came under fire for the cash, company stock and other perks that Chrysler directors routinely dangled to entice him not to leave the company or retire early. At his last shareholder meeting as Chrysler CEO and chairman in May 1992, Iacocca defended his compensation when a Japanese shareholder, speaking through an interpreter, noted that Japanese executives average only $350,000 in annual pay, vs. $1 million or more in Detroit. “But that doesn’t count the $1.5 million in country club membership for the Japanese,” Iacocca said. “They think we’re all fat cats here, but I don’t see any monks over there where the perks aren’t as obvious.” Post-retirement After his retirement from Chrysler, Iacocca never really left the stage, still eager to speak out and cash in on the next big consumer product. He appeared on “The Tonight Show with Jay Leno” in March 1993, began commanding $75,000 for 30-minute speeches and in 1995 became a director of Koo Koo Roo chicken, a California restaurant chain. Iacocca also shot back into the headlines in April 1995 by teaming with billionaire investor Kirk Kerkorian, a leading Chrysler shareholder, in a bold bid to take the company private. But Eaton, Iacocca’s successor, viewed the takeover attempt as hostile. The ensuing fight, carried out in public for months, turned ugly and personal and singed Iacocca’s reputation. Iacocca blamed Eaton for failing to do enough to improve Chrysler’s quality ratings. Chrysler canceled some of Iacocca’s stock options. Plans to name Chrysler’s new headquarters tower in Auburn Hills in honor of Iacocca were scrapped. Chrysler sued Iacocca in December 1995, alleging the former chairman divulged confidential information to Kerkorian while Iacocca was still a consultant to Chrysler. As part of his retirement, Iacocca continued to be paid $500,000 a year as a consultant and received company perks until the end of 1994. Chrysler contended he violated the consulting pact and that he abrogated his duties as an officer and director. As part of a 1996 settlement that ended the takeover bid, Iacocca received $53 million -- $21 million from Chrysler and $32 million from Kerkorian’s firm. Iacocca also was prohibited for speaking publicly about Chrysler for five years after the settlement. Later in 1996, Iacocca told Fortune magazine in a cover story that he had “flunked retirement.” In 1998, Iacocca was back in Detroit, teaming with former GM Chairman Bob Stempel to announce their effort to create lightweight electric vehicles. Iacocca was chairman of EV Global Motors, a Los Angeles company aiming to design and market the vehicles, and Stempel was chairman of Energy Conversion Devices, a maker of nickel metal-hydride batteries under its subsidiary, Ovonic Battery Co., in Troy, Mich. “This is the changing of the guard,” Iacocca, then 73, said during the announcement with Stempel. “In the new millennium, for young people it’s going to be an electric world.” Iacocca branched out again with Lido Motors, a partnership that marketed neighborhood EVs for use in retirement communities. While Iacocca was convinced aging Americans would slowly embrace EVs -- “You’ve got to stay with your market,” he told The Detroit News in 2002 -- he eventually abandoned the market. In 2000, he founded Olivio Premium Products to sell an olive oil-based butter substitute. Iacocca donated all of the profits from the company to diabetes research, a cause he had supported for years because his first wife, Mary, died of complications from the disease. According to Olivio’s website, Iacocca has donated more that $25 million to diabetes research. By 2005, he was appearing with the rapper Snoop Dogg, actor Jason Alexander and others to pitch Chrysler’s employee-pricing deals in TV commercials. The four spots signaled the official end of the bitter feud between Chrysler and Iacocca over the 1995-96 takeover attempt. In June 2008, with Chrysler facing another dark hour, Iacocca was invited back to corporate headquarters at the request of then-Chairman and CEO Bob Nardelli. Iacocca had been gone for 16 years but still showed some vigor at age 83. And ever the optimist, he offered another dose of encouragement as the company grappled with slumping SUV sales, rising gasoline prices and lingering scars from the scuttled DaimlerChrysler merger. “Don't get panicked,” Iacocca told about 1,000 workers at a meeting at the Chrysler Technical Center in Auburn Hills, The New York Times reported. “Things are going to be OK.” And they were, only after Chrysler was rescued again by the U.S. government and an Italian. This time, Fiat’s Sergio Marchionne. A Chrysler legacy In July 2010, just a year after Chrysler’s second federal bailout and bankruptcy, the Walter P. Chrysler Museum in Auburn Hills honored Iacocca with one of four inaugural Walter P. Chrysler Legacy awards. It was one of Iacocca’s last visits to the sprawling tech center and corporate campus that he helped build. And with Chrysler on the cusp of another U.S. sales rebound, he sounded like the optimistic and determined Iacocca many Americans came to know in the 1980s. When he reached the lectern after Marchionne’s introduction, an 85-year-old Iacocca told the gathering he was “really honored” and personally touched by the familiar faces in the crowd -- Sperlich and Greenwald, among them -- who spent the “last 25 years trying to keep Chrysler afloat.” Then, in one of his final pep talks that echoed his commercials decades earlier, Iacocca said he was counting on Marchionne, who died in 2018, to “bring over the Fiat label, put it together over here” and help give Chrysler “a huge boost” in the small-car market. “The Big 3 is coming back … we’re in for a little bit of prosperity after a few, little rough time,” Iacocca told the homecominglike crowd. “Let’s count our blessings and let’s get together and make this work. OK?” . Quote Link to comment Share on other sites More sharing options...
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