Chrysler savior, Mustang champion and TV pitchman redefined CEO role in America

Henry Ford. Alfred P. Sloan. Walter P. Chrysler. Soichiro Honda. Ferdinand Piech.

Few inventors, visionaries or executives get the chance to transform one automaker and help build the modern auto industry, but Lee Iacocca figured most prominently in the late 20th century success of two of Detroit's Big 3.

A bright, charismatic engineer turned marketing genius who conceived the Ford Mustang, stewarded Chrysler's historic U.S. rescue and 1980s turnaround and championed the minivan, Iacocca won widespread acclaim as America's most famous CEO and car salesman.

A tireless pitchman and competitor with Italian roots and a fondness for cigars, vinyl car roofs and Greek-temple grilles, he defined the role of the imperial American executive as Ford Motor Co. president and later as Chrysler chairman and CEO.

Iacocca died Tuesday, July 2, at home in Bel Air, Calif. He was 94 and had suffered from complications of Parkinson's disease.

Visitation is scheduled for 2 to 8 p.m. Tuesday, July 9, at Lynch & Sons Funeral Home in Clawson, Mich. The funeral is set for 11 a.m. Wednesday, July 10, at St. Hugo of the Hills in Bloomfield Hills, Mich. Iacocca will be buried at White Chapel cemetery in nearby Troy, the funeral home said.

With unbound ambition forged in the Great Depression, Iacocca was destined for stardom very early in his career, when, in 1960, behind the success of a sales promotion, he became the youngest man ever to head Ford's flagship division.

Iacocca's towering public face, corporate pitches, bold leadership and straight-talking voice for the American auto industry's triumphs and challenges dominated the nation's TV sets and newsstands in the '80s and early '90s.

"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, pegged Iacocca "a hip-shooter deluxe." Newsweek said he was 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."

Fiat Chrysler Automobiles paid tribute to Iacocca as one of the "great leaders of our company and the auto industry ... who played a profound role on the national stage as a business statesman and philanthropist.

"Lee gave us a mindset that still drives us today — one that is characterized by hard work, dedication and grit."

Iacocca, at the end of his storied automotive career, which spanned the late 1940s to the early 1990s, acknowledged 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."

When John Riccardo abruptly retired as Chrysler chairman and CEO, Iacocca, recently fired by Henry Ford II, took the reins of a teetering Chrysler, among the smallest of Detroit's automakers. He pressed President Jimmy Carter and Congress in late 1979 and early 1980 to obtain a $1.5 billion loan guarantee from the U.S. government. Chrysler came up with $2 billion in cost reductions in return.

Iacocca orchestrated a series of drastic cost-saving measures — "equality of sacrifice," he called it — and slashed his own salary to $1 as part of the unprecedented bailout.

Iacocca gutted Chrysler's senior executive ranks, drafted former Ford colleagues and lured a few star outsiders to retool the company. Its archaic sales bank that saddled dealers with unwanted inventory was scuttled, and dealer and consumer rebates were instituted.

Iacocca's first commercial plug for Chrysler came in a 1979 print ad. It featured his signature below a 1,052-word statement in which he presented the company's sweeping case for federal loan guarantees.

His commercial TV appearances started that year 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," Iacocca said. "I'm asking you to compare."

With the loan guarantees secured, 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 profit. Iacocca 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 bestseller, Iacocca: An Autobiography. "If we failed here, it was all over."

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 1983 — seven years ahead of schedule — in a feat celebrated by Iacocca at the Waldorf Astoria hotel in New York.

"This is the day that makes the last three miserable years all seem worthwhile," Iacocca said. "We at Chrysler borrow money the old-fashioned way. We pay it back."

Iacocca, recognizing the American family's need for fuel economy, roominess, comfort and function at a modest price, long believed in the minivan.

While Iacocca was still at Ford, Chrysler's product planning team, under director Burt Bouwkamp, had proposed a minivan program to top management in the early 1970s. The company's advance product planning and advance styling department created a minivan concept with a full-size clay model and seating buck.

Bouwkamp described the vehicle to management as a "garageable" van because a family vehicle had to be able to be parked in the garage to be successful.

Iacocca was convinced there was a market for such a van with a low step-in height, and advanced engineering on the minivan started the week Iacocca joined Chrysler as COO in 1978.

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.

The Voyager and Caravan, introduced in 1984, became two of the hottest new products of the 1980s.

By the mid-1980s, Iacocca was a household name, appearing regularly in Chrysler's TV ads, often taking shots at Japanese rivals and daring U.S. consumers to consider rivals' vehicles.

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.

His name was tossed around as a possible presidential candidate. 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.

President Ronald Reagan in 1982 appointed Iacocca head of the Statue of Liberty-Ellis Island Foundation created to help raise funds for the renovation of the New York Harbor landmark.

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 — and beyond. Sales topped 200,000 copies per month in Japan, and it became a must-read among "the Saudi technocratic elite," Time said.

Iacocca wrote 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 state of the Detroit 3, why America couldn't build a competitive hybrid and other hot topics of the day.

Lido Anthony Iacocca was born 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.

Lee Iacocca earned a master's degree in mechanical engineering from Princeton University in 1946 and joined Ford as an engineering trainee that same year.

"I learned at Princeton that pure research did not fascinate me," he told Time in 1964.

Neither did applied engineering. Iacocca lasted just nine months as an engineer; he became disenchanted during Ford's tough "Rouge Loop Course," in which trainees learned the basics of car manufacturing. He was assigned a job as an automatic transmission engineer but turned it down.

After leaving engineering, Iacocca joined Ford's sales and marketing district sales office at Fort Chester, Pa. He launched his meteoric rise to the top of Ford in 1956, when he conceived the "56 for '56" campaign. With a 20 percent down payment, customers could purchase a 1956 Ford for $56 per month for three years.

The success of the program helped Iacocca get elected vice president and general manager of the Ford Division in 1960. He was just 36 at the time. Only Henry Ford II, it was often said, advanced faster through the ranks at Ford.

Iacocca described heading the Ford Division as one of the happiest periods of his career.

With baby boomers moving into prime car-buying age, Iacocca quickly marshaled Ford resources to develop a sporty, moderately priced vehicle to tap into the youth-oriented culture flourishing after the somnolent 1950s.

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 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 nimbleness and speed.

"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."

The instant success of the Mustang — developed for what Iacocca called "an unheard of low amount at the time to design and push a new car line through to production" — put him on the fast track at Ford.

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.

The Mustang's success won Iacocca one promotion after another in the 1960s, culminating in 1970, when he became president of Ford.

Iacocca's other home run, the minivan, 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.

Iacocca's other automotive 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 drafted some of the industry's biggest flops, notably the TC by Maserati, a car marketed by Chrysler in the 1980s.

In the early 1960s, Ford was poised to become the first Detroit automaker to sell a fwd car in the states — ahead of GM and Chrysler — but Iacocca scrapped plans to market the Cardinal, which Ford had developed in Germany and that proved to be a big seller across Europe.

In 1988, Chrysler and Fiat signed a pact that allowed Chrysler to sell Alfa Romeo vehicles in Canada and the U.S. The distribution deal was scrapped in 1991.

Chrysler, under Iacocca, also created the Eagle brand — a vestige of Chrysler's acquisition of American Motors and its vaunted Jeep line — but it was dropped after the 1998 model year.

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 company was fined $120 million.

Iacocca also was responsible for the ill-fated Ford Pinto. He rushed the Pinto into 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 ordered it to 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, first reported that Ford knew about the issue with the Pinto's fuel tank but continued to produce the car anyway.

Iacocca, in his autobiography, 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 and paid millions in restitution to settle numerous lawsuits.

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 the latest to join a famous fraternity — the long list of men such as Ernie Breech, John Dykstra, Arjay Miller and Bunkie Knudsen — who climbed to a top post at Ford only to be pushed aside by a mercurial Ford II.

Ford and Iacocca 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, I was more important than Henry," Iacocca wrote in his autobiography.

"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: Henry Ford, His Company, and a Century of Progress.

Iacocca told Automotive News in July 1978 that he was canned because Ford II didn't "want strong guys around."

Ford dismissed Iacocca to prevent him from becoming 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."

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 Ford II's closest confidants, wrote that Iacocca tried to oust Ford II by suggesting he was senile and no longer able to run the company.

Iacocca denied those claims.

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 Ford by going to the board to oust him.

Iacocca — once a symbol of self-sacrifice for slashing his salary to help rescue Chrysler — also personified the trappings of corporate America and Detroit's longtime excesses.

"The Depression turned me into a materialist," Iacocca wrote in his autobiography. "Years later, when I graduated from college, my attitude was: 'Don't bother me with philosophy. I want to make ten thousand a year by the time I'm 25, and then I want to be a millionaire.' "

More than once during his high-profile career, Iacocca was forced to defend his pay and stock options, notably to journalists from Japan, which was a frequent target of Iacocca's rants over trade policy and where executive compensation is, at least nominally, far more modest.

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.

Iacocca never left the stage after his retirement. He appeared on "The Tonight Show with Jay Leno" in March 1993, commanded $75,000 for 30-minute speeches and became a director of Koo Koo Roo chicken, a California restaurant chain.

Iacocca 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 Bob Eaton, Iacocca's successor, and Chrysler directors viewed the takeover attempt as hostile.

The ensuing fight, carried out in public for months, turned ugly and personal. Iacocca, vilified and tarnished in the press, 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, Mich., 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 $500,000-a- year consultant to Chrysler.

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 from 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 returned to Detroit, teaming with former GM Chairman Bob Stempel to build and market 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.

Iacocca branched out again with Lido Motors, a partnership that marketed neighborhood EVs for use in retirement communities.

Although 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 project.

By 2005, he was appearing with 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 '95-'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, after Chrysler was rescued again by the U.S. government and another North American of Italian heritage: Fiat's Sergio Marchionne.

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 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 crowd. "Let's count our blessings, and let's get together and make this work. OK?"