Last week the renowned auto executive, Mr. Lee Iacocca, died at age 92. What an outstanding force in automotive history!
He realized in the early 1960s there was a market not being served — a “young person’s car” — one that was affordable, sexy, and sporty. The Ford Mustang was born and the rest is history. First introduced in 1964, it was certainly was a hit from the very beginning.
The “pony car” was offered in a 6 cylinder or a small block V-8. Many loved the simple but stylish Mustang, and they certainly loved the price for such a fine looking automobile. It easily carried four (though the back seat was an afterthought to offer seating for two extra people). The Plymouth “Barracuda” was offered a few weeks earlier, but the Mustang found an early and strong following.
Mr. Iacocca was a visionary, and visionaries sometimes strong in their convictions rub others the wrong way. Thus, unfortunately, he was fired by Henry Ford II in 1978. This firing was amid a company profit year of $2 billion. They clashed constantly and Ford finally had enough.
Too bad for Ford, because Mr. Iacocca ended up at Chrysler. A third rate player in the auto industry and on the verge of bankruptcy, its Dodge Aspen and Plymouth Volare were quality nightmares for owners and were being recalled or a regular basis. Iacocca said these wrecks never should have been produced. He started to rebuild the company from the ground up, bringing in many former associates from Ford.
Realizing Chrysler would go bankrupt if it did not receive an infusion of cash, in 1979 he went hat in hand to the U.S. Congress to ask for a loan guarantee. Chrysler reduced costs and abandoned projects.
Iacocca then released the K-car line — Dodge Aries and Plymouth Reliant in 1981. Both were Ford design rejects, in which Iacocca saw value in small, fuel efficient and inexpensive front wheel drive models. They were a hit and the profits poured in.
At Ford, Iacocca started a project, called “Mini-Max”, a van type vehicle, which Henry Ford wanted no part of. Luckily for Chrysler, Iacocca again realized a need for a family van, not a station wagon, but for child carrying and storage for baggage, sports equipment, and family trips. A much larger version of a station wagon that had a higher profile.
Being the Chrysler CEO, he quickly got approval for the production of the minivan and the rest is history. His instincts for a market need were unquestioned. The minivan, introduced in 1983, was a hit from the very beginning.
The company, with the new hits and reforms, Iacocca’s leadership and profits allowed the company to repay the government loans seven years early. In 1987, his uncanny instincts acquired AMC, in which the profitable Jeep line division came under Chrysler.
Through the 1980s, Mr. Iacocca appeared in commercials for the company, with the trademark phrase, “If you can find a better car, buy it.”
Of all the last 50 years of automotive history, Lee Iacocca was heads above the competition in seeing an unmet market need and coming up with a solution to meet the need. That is what real marketing is all about. Money is spent on whatever the purchasers feel is the best fit for their needs. In many instances, especially in the 1980s and 1990s it was a Chrysler product.
And most of that success can be attributed to the foresight and leadership of Lee Iacocca. Well done!
The rotting of America from within continues (but not because of Lee Iacocca. May he rest in peace!)