Chrysler Chairman Lee Iacocca sits in the front seat of a prototype Chrysler LeBaron Convertible in 1981. Photo / Getty Images
Chrysler Chairman Lee Iacocca sits in the front seat of a prototype Chrysler LeBaron Convertible in 1981. Photo / Getty Images
Lee Iacocca, the automobile industry executive who helped launch the Mustang at Ford and save Chrysler from bankruptcy, and whose cunning, ingenuity and swagger made him one of the most successful salesmen of his generation, died July 2 at his home in the Bel-Air area of Los Angeles. He was 94.
The cause was complications from Parkinson's disease, said his daughter Lia Iacocca Assad.
For a vast swath of the American public, Iacocca was the face, the voice and the symbol of the car business in Detroit at its most resourceful and industrious. The hard-charging Iacocca, an immigrant's son who rose to a vice presidency at Ford at 36, first gained broad renown in 1964, when he helped take the company to a new level of stylishness and panache with the Mustang sports car.
Iacocca's career continued to skyrocket. He became company president, only to be abruptly fired in 1978 by Henry Ford II, the grandson and namesake of the auto company's founder, in what was often chalked up to a clash of egos and personalities.
Almost immediately, Iacocca rebounded as chairman of Chrysler. He was widely credited with saving the company from bankruptcy by persuading Congress in 1980 to approve federal loan guarantees of up to $1.5 billion.
Chrysler, which had been the straggler among Detroit's Big Three, came roaring back as Iacocca closed factories, dismissed tens of thousands of employees, slashed executive salaries, persuaded suppliers to accept delayed payments and wrung concessions from labor unions. He cut his own salary to a dollar a year.
Jay Leno and Lee Iacocca looking at old Mustangs. Photo / Getty Images
In addition, he boosted sales by introducing the fuel-efficient K-car line and the minivan, which would lead the auto industry in sales for years. He restored profitability in what has been described as the biggest individual corporate save in U.S. business history. Under Iacocca, the company paid back its loans - $1.2 billion and interest - in 1983, seven years before they were due.
"We at Chrysler borrow money the old-fashioned way. We pay it back," a beaming Iacocca said at a news conference.
At a time when the country was shifting out of a period of economic malaise, Iacocca seemed a straight-shooting leader brimming with self-confidence. Media coverage portrayed Iacocca as an industry savior, and he added to his allure through aggressively cocksure TV commercials promoting Chrysler cars - and, in the process, himself.
As the advertisements began airing in late 1980, few could forget the image of the 6-foot-1 Iacocca, with aviator glasses perched atop his nose, pacing the floor of a Chrysler assembly-line factory, shaking a finger at the camera and declaring, "If you can find a better car, buy it!"
In the mid-1980s, he ranked behind only President Ronald Reagan and Pope John Paul II in a Gallup-poll list of the world's most respected men. He was admired for his shrewdness and his visceral desire to win. His self-titled 1984 memoir, written with author William Novak, was on the bestseller lists for 38 weeks and sold more than 6.5 million copies.
A bona fide celebrity, Iacocca socialized with Frank Sinatra, roused thousands of high school students to their feet at commencement speeches, led fundraising efforts to refurbish the Statue of Liberty and Ellis Island, and was feted like a rock star at political gatherings.
Frank Sinatra, Lee Iacocca and Barbara Sinatra. Photo/ Getty Images
Bounding back to success after being dismissed at Ford appealed to an underdog-loving public. Iacocca was beseeched to run in 1988 to succeed Reagan, but his eviscerating management style, notoriously thin skin and off-the-cuff, frequently profane remarks increasingly brought doubt about whether he had the temperament for high office.
The car industry was another matter.
Even trade unionists, not ordinarily fond of praising executive-suite personnel, basked in his charismatic glow and chanted his name as he strode onto assembly-plant floors. A United Auto Workers president, Douglas Fraser, whom Iacocca placed on the Chrysler board, once told Time magazine that dues-paying members repeatedly asked for a favor: Could he please get Iacocca to sign copies of his autobiography for them?
He was neither an operations nor a manufacturing genius, automobile industry analyst Maryann Keller told The Washington Post. But he was a world-class salesman.
"He understood marketing," Keller said. "Using his own persuasive powers, he was able get people to overlook the limitations of Chrysler automobiles and he was able to get Congress to overlook the fact that the company really was in financial trouble. . . . He made people believe in him."
Lido Anthony Iacocca was born in Allentown, Pennsylvania, on Oct. 15, 1924. His parents, Nicola and Antoinette, had immigrated to the United States from Italy.
His father was an entrepreneur who ran a variety of businesses, including a car rental agency and movie theaters.
"My father was such a great promoter that kids who came down to the Saturday matinees used to get more excited about his special offers than about the movies," Iacocca later wrote in his memoir. "People still talk about the day he announced that the ten kids with the dirtiest faces would be admitted free."
The family was wealthy for a few years before the Great Depression, but Nicola Iacocca lost all his money in the stock market crash of 1929. The family's economic suffering was a driving force in Lee Iacocca's ambitions for financial success.
Lee Iacocca and Donald Trump during a wedding at St Patrick's Cathedral in New York City. Photo / Getty Images
In his sophomore year of high school, a bout of rheumatic fever led to paralysis in his legs for a time. This kept him out of competitive sports and later out of military service during World War II. He channeled his vigor into academics and the debating society. He became class president and a member of the National Honor Society.
He completed a bachelor's degree at Lehigh University in Bethlehem, Pennsylvania, in three years and, after graduating in 1945, won a fellowship for graduate study in engineering at Princeton University. "I wasn't interested in a snob degree," he wrote in his memoir, speaking of the Ivy League degree. "I was after the bucks."
Iacocca began his ascent of the corporate ladder at a propitious time. World War II had just ended. After a wartime hiatus to concentrate on military production, Detroit was retooling its factories to turn out civilian vehicles again. The American car was ready to transform the way Americans lived.
Millions of war veterans were back from overseas, marrying and having children. Millions more Americans were moving from the cities to suburbs, and they all needed automobiles to support their new lifestyles.
Onto this stage strode Iacocca. In August 1946, he arrived in Dearborn, Michigan, as an engineering trainee at Ford. He quickly became bored and restless with the solitary and tedious work.
"I was eager to be where the real action was - marketing or sales," he said. "I liked working with people more than machines." Ford approved his request for a transfer, on the condition that he find a new job himself, which he did - a low-level fleet sales job in Chester, Pennsylvania.
In 1956, Iacocca married Mary McCleary, a receptionist at the Ford sales office in Chester. Around that time, Iacocca worked his way up to assistant sales manager of the Philadelphia district. He tried a sales gimmick that caught the attention of Robert McNamara, the future defense secretary, who was then the company's vice president in charge of all car and truck divisions.
"I decided that any customer who bought a new 1956 Ford should be able to do so for a modest down payment of 20 percent followed by three years of monthly payments of $56," Iacocca wrote in his memoir. "I called my idea '56 for '56.' "
The plan was so successful that in three months, sales of Fords in the Philadelphia district shot to first place from last. McNamara so liked the idea that he made it part of Ford's national marketing strategy. The company later estimated that the idea was responsible for selling 75,000 additional cars.
In 1960, McNamara became president of Ford. Iacocca replaced him as vice president and general manager of the Ford car and truck divisions. He was 36, one year beyond the goal he had set for himself for achieving a vice presidency.
To his job, Iacocca brought a new concept in sales and styling that was fundamentally different from McNamara's. McNamara, he said, had a "deep conviction that a car was a means of transportation, not a toy."
McNamara was primarily concerned with basics, such as fuel efficiency. Iacocca, not so much. Based on market research, Iacocca saw that younger buyers were beginning to dominate the market. The design and appearance of a new model was critical. Cars coming off the Ford assembly lines had to be more than reliable, efficient and functional. They had to look good, what Iacocca described as "a car you could drive to the country club on Friday night, to the drag strip on Saturday, and to church on Sunday."
The result was the Mustang.
Months in advance of its debut, an aggressive promotional campaign was launched. Editors of college newspapers were loaned Mustangs to drive several weeks before the official introduction date. Television networks were blanketed with Mustang commercials.
Lee Iacocca is credited with having saved Chrysler from bankruptcy. Photo / Getty Images
In its first year, the Mustang sold 418,812 models, a record for Ford products, and it generated $1.1 billion in profits for the company. The Mustang was a phenomenon - it made the cover of the major newsweeklies and had a pivotal cameo in the police drama "Bullitt" (1968), with ultracool movie star Steve McQueen behind the wheel.
Buoyed by the continuing success of the Mustang, Iacocca earned a series of promotions that culminated in his appointment as Ford's president in 1970.
As president, one of his chief tasks was finding ways to cut inefficiencies company-wide - giving heads of lagging divisions a limited time to turn things around or suffer the consequences. He had long been viewed as a hard-nosed manager. He had his department heads define their goals and objectives, and then graded them on their performance in a black notebook.
A polarizing figure in the company, he had many who admired his instinctive business savvy and many who could not abide his hyper-critical, micro-managing and shoot-from-the-lip personal style.
In the 1970s, Iacocca presided over one of the company's greatest fiascoes: the Pinto. Initially a moneymaker, the car was revealed to have a gas tank leakage that made it a hazard. A massive recall was ordered.
In addition, rising fuel costs during the Arab oil embargo and increasing competition from the Japanese and other foreign car industries that specialized in sporty and fuel-efficient vehicles were threatening Detroit.
Iacocca's eight years as president were made difficult by his tense relationship with Henry Ford II.
As Iacocca told it in his autobiography, Ford repeatedly reduced the president's authority and prestige through a series of executive reorganizations, directed the arbitrary and capricious firing of other executives, and had a close friend of Iacocca's investigated for Mafia connections, which were never found.
"If a guy is over 25 percent a jerk, he's in trouble," Iacocca later said. "And Henry was 95 percent."
He said Ford never gave a specific reason for his dismissal. "We had just completed the two best years in our history," he wrote in his autobiography. But he quoted Ford as telling him: "I think you should leave. It's personal. . . . It's just one of those things . . . sometimes you just don't like somebody."
The Ford-Iacocca showdown was widely perceived as a dust-up between the upstart son of Italian immigrants and the scion of the automotive aristocracy. That Iacocca would cast his lot with Chrysler, a Ford competitor, after being fired was seen as a case of "Don't get mad. Get even," which only enhanced the Iacocca mystique.
After Iacocca, then 54, accepted an offer to run Chrysler, found a company badly mismanaged - "Nobody knew who was on first," he said - and hemorrhaging cash.
This picture from 1989 shows Iacocca puffing on a cigar. Photo / Getty Images
John Riccardo, Iacocca's predecessor as the Chrysler chairman, had already been traveling to Washington seeking help from Congress in the form of tax credits and the easing of federal regulations, but Riccardo had won little support.
Only as a last resort, Iacocca said, did the company ask for federal loan guarantees. As he later said, "There was no other choice except bankruptcy."
"Loan guarantees, I soon learned, were as American as apple pie," he wrote in his autobiography. "Among those who had received them were electric companies, farmers, railroads, chemical companies, ship builders, small businessmen of every description, college students and airlines."
He was on national television newscasts asking Congress to approve federal loan guarantees for Chrysler, which the company eventually received. The exposure he received through these appearances and Chrysler commercials propelled Iacocca into a national celebrity.
The architect of this effort was Leo-Arthur Kelmenson, chief executive of what then was Kenyon & Eckhardt, the advertising agency that had at great risk quit its long-standing client, Ford, to work for Chrysler at Iacocca's behest.
Kelmenson devised an ad campaign that asked bluntly, "Would America be better off without Chrysler?" The answer clearly was no, the ad suggested.
Also from Kelmenson came the idea to feature Iacocca in the television commercials for Chrysler cars. It was rare, if not unprecedented, for such advertisements to feature chief executives in person, but Kelmenson argued that television footage of Iacocca in the flesh would give the commercials a credibility and heft they could gain in no other way.
There was an element of patriotism in the Iacocca message. By the 1980s, the American automobile industry was no longer the globally dominating colossus it had been. Foreign cars had established deep inroads. Iacocca liked to mention that the cars he was selling were made in America, which conveyed a less-than-subliminal thought that to buy a Chrysler product was to strike a blow on behalf of the U.S.A. against foreign intrusion.
In addition to aggressive cost-cutting measures, Iacocca boosted Chrysler finances with strong sales of the Dodge Caravan and Plymouth Voyager minivans. On those sales and the acquisition of American Motors in 1987 - the maker of the Jeep brand - lay the foundation on which Iacocca rebuilt Chrysler.
The firm had a long history teetering between sizable profits and losses, and Iacocca could never entirely keep it in the black. He retired in 1992 but remained a consultant at $500,000 a year.
In 1995, he backed billionaire investor Kirk Kerkorian's unsuccessful $23 billion hostile takeover bid for Chrysler. This led to an attempt by the car company to block Iacocca from exercising $42 million in stock options, claiming he gave away confidential information. He sued, and the claim was settled out of court for $21 million.
Iacocca's first wife died in 1983. Iacocca's later marriages, to advertising executive Peggy Johnson and restaurateur Darrien Earle, ended in divorce. In addition to his daughter, of Laguna Beach, California, survivors include another daughter from his first marriage, Kathryn "Kate" Iacocca Hentz of Cohasset, Massachusetts; a sister; and eight grandchildren.
In retirement, Iacocca remained outspoken about the business he knew best.
He was dismissive of Chrysler's merger in 1998 with the German automaker Daimler-Benz, a union that fell apart less than a decade later amid a clash of corporate cultures. Chrysler was sold to the private equity firm Cerberus Capital Management, which in 2009 allowed Italian carmaker Fiat a large minority stake in Chrysler.
Even in later years, Iacocca maintained an aura of success. In recent years, he was often invited back to Chrysler give pep rallies as the company continued to cut jobs and suffer amid rising gas prices, economic turmoil and plummeting sales.
He also returned to serve as pitchman, helping the company appeal to different demographics by appearing in commercials with "Seinfeld" actor Jason Alexander and the rapper Snoop Dogg.
In one TV spot, Iacocca's famous pitch line - "If you can find a better car, buy it!" - gets a hip-hop translation by Snoop Dog: "If the ride is more fly, then you must buy." When Iacocca tells viewers the car is a good deal, Snoop Dogg replies, "Fo shizzle, I-ka-zizzle."
"He's just a good kid," Iacocca told USA Today about his co-star. "I didn't understand half the things he was telling me, but it was fun."
