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Iacocca, Lee

Lee Iacocca

Born: October 15, 1924
Allentown, Pennsylvania
Business executive and former CEO,
Chrysler Corporation

Lee Iacocca obviously paid close attention to his parents and he certainly made something happen on more than one occasion. After a 32-year career with Ford Motor, including helping to design the Mustang sports car, Iacocca engineered one of history's greatest corporate comebacks at Chrysler. His success, coupled with appearances in television commercials and his best-selling books, made him one of the nation's most well-known and admired businessmen. While head of Chrysler, there was speculation that Iacocca might run for political office, even president of the United States, but he remained in the private sector even after retiring from Chrysler in 1993.

"People say to me, 'You were a roaring success. How did you do it?' I go back to what my parents taught me. Apply yourself. Get all the education you can, but then, by God, do something. Don't just stand there. Make something happen."

Learns Finances from His Father

Lido "Lee" Anthony Iacocca was born October 15, 1924, in Allentown, Pennsylvania, the son of Italian immigrants Nicola and Antoinette. He grew up in comfortable surroundings learning the nuts and bolts of business from his father. Nicola Iacocca was an entrepreneur who taught his son about the responsibilities of borrowing money and the need for a hard- driving vision in order to build a thriving business. Over the years the elder Iacocca worked as a cobbler, and owned a hot dog restaurant and a theater. He also ran one of the first car rental agencies in the country and passed on his love of the automobile to his son. When he was ten years old, Lee Iacocca worked as a freelance delivery person outside the local grocery store. He worked long hours in a fruit market at the age of sixteen.

When he graduated from high school, the United States was in the throes of World War II (1939-45). Iacocca was not required to join the military because he had rheumatic fever as a child, which left him in somewhat poor health. Instead he earned his bachelor's of science degree in industrial engineering from Lehigh University in Bethlehem, Pennsylvania. Upon graduation, he secured a coveted engineering trainee job at Ford, but delayed his start until he completed his master's degree at Princeton.

As one of a group of young engineers being groomed by Ford for a career in design and production, Iacocca quickly grew restless and became interested in the more dynamic worlds of sales and marketing. He was assigned to fleet sales in Ford's Chester, Pennsylvania, office, and over the next few years he honed his communications skills and ability to predict consumer trends. Confident and ambitious, Iacocca skyrocketed through the ranks of Ford's sales divisions.

Even as a teenager, Lee Iacocca decided that he was going to be an auto company executive and focused his studies in that direction. He first studied mechanical engineering and then, because of bad grades in physics, switched to industrial engineering, picking up several business and psychology courses along the way.

Hitting the Corporate Bull's-eye

It was the 1964 Mustang that secured Iacocca's position in automotive history. Recognizing that Ford needed a domestic winner, he set about looking for a market that had not been tapped by automakers. He landed on America's youth, a wealthy generation with car-buying potential. In his 1984 autobiography, Iacocca wrote: "Any car that would appeal to these young customers had to have three features: great styling, strong performance, and a low price. Developing a new model with all three would not be easy. But if it could be done, we had a shot at a major success." The shot hit the bull's-eye. Bolstered by an ambitious advertising campaign and favorable press coveragethe car was put on the cover of Newsweek and Time in the same week419,000 Mustangs were sold over the next twelve months, a record for a first-year model.

Dieter Zetsche: German Engineer Takes Charge

In 2000, Dieter Zetsche took over as head of DaimlerChrysler's Chrysler Group, bringing his strong German presence and conservative financial philosophy to the newly formed company's American division. He instantly made waves when one of his fist cost-cutting acts was to lay off twenty-six thousand workers and close six plants.

Zetsche was born on May 5, 1953, in Istanbul, Turkey, where his father was working as an engineer for a construction firm. He grew up, however, in the German city of Frankfurt. One of his first jobs was driving a beverage truck. In 1976 Zetsche earned his master's degree in electrical engineering from Germany's University of Karlsruhe. He began at Daimler-Benz that same year, working in its research division. Five years later he became assitant to the chief engineer of the commercial vehicle division. In 1982, Zetsche received a doctorate in mechanical engineering from the Univeristy of Paderborn in Paderborn, Germany. The company named him chief engineer of Mercedes-Benz Brazil in 1987; two years later he was made president of Mercedes-Benz Argentina.

Zetsche's first experience in the American workplace came when Daimler-Benz transferred him to Portland, Oregon, in 1991 to serve as president of its troubled Freightliner Corporation, a commercial truck subsidiary. A year later, he returned to Germany and moved up in the company ranks. When a merger with U.S. automaker Chrysler was announced in 1998, Zetsche was moved to a DaimlerChrysler board position responsible for the commercial vehicle business. He took over as head of the Chrysler Group in 2000.

"Zetsche deserves respect," editor-in-chief Lindsay Brooke wrote in the December 2000 issue of Automotive Industries magazine. "He approaches challenges like the astute manager and engineer that he is. That's a valuable attribute, because Chrysler has lost so much that it must now recover with his leadership."

Iacocca served as president of Ford between 1970 and 1978, cutting costs, streamlining operations, and forcing managers to turn unprofitable divisions around during a rocky time in automotive history. The U.S. auto industry was facing intense competition from foreign companies and gasoline prices were rising dramatically, causing a temporary halt on new car purchases. Ironically, the managerial talent and marketing genius that had pushed Iacocca into the corporate limelight and given the company renewed success also brought him into conflict with Henry Ford II (1917-1987), the chairman and grandson of the company's founder. The differences gradually increased during the 1970s and culminated in 1978 when Ford fired Iacocca.

Five months after his firing, Iacocca was named president of Chrysler. He became chairman of its board of directors in 1979 and CEO in 1980. In a few years, he transformed the number-three automaker from a company near bankruptcy into a highly profitable enterprise. Iacocca turned Chrysler around by reducing expenses, winning approval of $1.5 billion in federal loan guarantees, selling off unprofitable units such as the military tank division, and introducing timely products. In 1984, the company posted profits of $2.4 billion, a total higher than it had made in the previous sixty years combined.

Because of the company turnaround and the quick payback of Chryler's loan guarantees, Iacocca became a star and a symbol of success. President Ronald Reagan (1911-) appointed him to oversee the restoration of the Statue of Liberty. He also became the television pitchman for Chrysler, a friendly face reassuring Americans that the country's great automotive history would remain strong. He was so popular that a 1985 opinion poll had him beating Vice President George Bush (1924-) in the 1988 presidential race, despite Iacocca's claim that he was not interested in the job.

Business Giant Stumbles

But the late 1980s and early 1990s were not as kind to the automotive giant. In the eyes of some, the famed business judgment that had catapulted Iacocca to stardom began to falter. Instead of reinvesting Chrysler's profits to produce new cars that would rival those of Japanese companies, Iacocca urged the company to expand. Among Chrysler's acquisitions were corporate jet-maker Gulfstream Aerospace, purchased for $637 million, and American Motors Corporation, bought for $757 million. The purchases seriously strained the company's financial resources.

Iacocca's popularity, like the company's earnings, began to fall off. His salary also became an issue. At one time he publicly announced that he was accepting a salary of only one dollar a year from Chrysler. That changed, however, and in 1987, Iacocca was taking home $18 million per year. In 1992, he called it quits and resigned from Chrysler. He remained as a consultant to the company, with a $500,000 a year salary and use of the company jet, until the end of 1994.

Lee Iacocca and Mary McCleary were married in 1956 and had two daughters, Kathi and Lia. Mary died of complications related to diabetes in 1983, and in her memory, all the profits from Iacocca's book sales go to help diabetes research.

In 1995, Iacocca announced that he was suing Chrysler, claiming that it unlawfully blocked him from exercising $42 million in share options that he had earned while he was the chairman. Before the lawsuit went to trial, Chrysler settled out of court, paying the former CEO $21 million. As he moved into the twenty-first century, Iacocca was still involved in the auto industry, investigating the market for electric cars in California. He even tried to rejoin Chrysler, but after several years of discussion, was turned down by DaimlerChrysler CEO Juergen Schrempp in 2002.

For More Information

Books

Dammann, George H. Seventy Years of Chrysler. Sarasota, FL: Crestline Publishing, 1974.

Iacocca, Lee. I Gotta Tell You: Speeches of Lee Iacocca. Detroit, MI: Wayne State University Press, 1994.

. Iacocca: An Autobiography. New York: Bantam Books, 1984.

Levin, Doron P. Behind the Wheel at Chrysler. New York: Harcourt Brace & Company, 1995.

Yates, Brock W. The Critical Path. New York: Little, Brown & Company, 1996.

Periodicals

Brooke, Lindsay. "Dieter Takes Charge." Automotive Industries (December 2000): p. 7.

Burt, Tim. "Zetsche Outlines Plans to Increase Sales." The Financial Times (April 29, 2002): p. 26.

Connelly, Mary. "Slowing Minivan Sales Worry Struggling DCX." Automotive News (March 12, 2001): p. 3.

"Cutting Back at Chrysler." The Economist (February 3, 2001): p. 5.

"Iacocca Says No Room for Him at Chrysler." New York Times (March 18, 2002): p. C4.

Meredith, Robyn. "Batman and Robin." Forbes (March 5, 2001): p. 66.

"Putting a New Spin on DaimlerChrysler Corp." Ward's Auto World (March 1, 2001): p. 61.

Sheppard, Robert. "Chrysler's Crisis." Maclean's (February 12,2001): p. 38.

Taylor, Alexander L., III. "Iacocca's Tightrope Act." Time (March 21,1983): pp. 50-59.

Web Sites

Chrysler. [On-line] http://www.chrysler.com (accessed on August 15, 2002).

DaimlerChrysler AG. [On-line] www.daimlerchrysler.com (accessed on August 15, 2002).

Dodge. [On-line] http://www.dodge.com (accessed on August 15, 2002).

Jeep. [On-line] http://www.jeep.com (accessed on August 15, 2002).

Mercedes-Benz. [On-line] http://www.mercedesbenz.com (accessed on August 15, 2002).

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Lido (Lee) Anthony Iacocca

Lido (Lee) Anthony Iacocca

After a 32-year career with Ford Motor Company, including eight years as president, Lido (Lee) Anthony Iacocca (born 1924) engineered one of business history's greatest comebacks at Chrysler Corporation. His success, coupled with appearances in television commercials and his best-selling book, made him one of the nation's best-known and most admired businessmen.

Lido (Lee) Anthony Iacocca was born October 15, 1924 in Allentown, Pennsylvania, the son of Italian immigrants Nicola and Antionette. Iacocca grew up in comfortable surroundings learning the nuts and bolts of business from his father. Nicola was an entrepreneur who taught his son about the responsibilities of borrowing money and the need for a hard-driving vision in order to build a thriving business. Nicola Iacocca worked as a cobbler, hot-dog restaurant and theater owner. He also ran one of the first car rental agencies in the country and passed on his love of the automobile to his son. Iaccoca was deferred during World War II because of having had rheumatic fever as a child. He earned his BS and MS degrees in engineering from Lehigh University and Princeton University, respectively. Even as a teenager, Iacocca decided that he was going to be an auto company executive and focused his studies in that direction. His degrees are in industrial engineering. He secured a coveted engineering trainee job at Ford in 1946, but deferred his start until he completed his masters degree at Princeton.

Joining Ford Motor Company as an engineering trainee in 1946, Iacocca soon entered the fast lane of sales. With the force of a muscle car and the maneuverability of a racing vehicle, in 1960, at age 36, he sped into the vice-presidency and general managership of the company's most important unit, Ford Division. In 1964, with others on his staff, he launched the Mustang, which, thanks to brilliant styling and marketing, introduced a new wave of sports cars, set a first-year sales record for any model, gave its name to a generation, and landed its creator's picture on the covers of TIME and Newsweek simultaneously.

In 1960 Iacocca was named Ford's vice-president, car and truck group; in 1967, executive vice-president; and in 1970, president. Pocketing an annual salary and bonus of $977,000, the flamboyant executive also earned a reputation as one of the greatest salesmen in U.S. history. Of Iacocca, it has been said that he was always selling, whether products, ideas—or himself.

From Ford to Chrysler

Iacocca was discharged from Ford Motor Company in June 1978 by Chairman Henry Ford II for reasons Ford never disclosed, but obviously relating to the chairman's distaste for having Iacocca succeed him. Though bitter at being dismissed from Ford, Iacocca was not out of the car business for long. Five months after his firing, Iacocca was named president of Chrysler (becoming chairman in 1979) and began transforming the number three automaker from corporate history's number one deficits manufacturer into a highly-profitable enterprise.

How was Chrysler turned around? By downsizing expenses to a much lower break-even point, by winning approval of $1.5 billion in federal loan guarantees, by selling off profitable units such as the tank division, and by introducing timely products. In addition, Chrysler welcomed, for the first time in U.S. corporate history, a union president to a board of directors. In 1984 the company posted profits of $2.4 billion (higher than in the previous 60 years combined), and in 1985 it bought Gulfstream Aerospace Corporation for $637 million and E. F. Hutton Credit Corporation for $125 million.

In the early 1980's Chrysler issued the K-car and what would later become its meal ticket—the minivan. Just as the Mustang re-established the sports car for Ford, the minivan would be loved by the young family in need of room and efficiency and revitalize Chrysler. In 1983, Chrysler paid the government back its loans and Iacocca became a star, a symbol of success and the achievement of the American Dream.

Along with spearheading Chrysler's resurgence, Iacocca assumed various civic responsibilities, most notably the chairmanship of the President's Statue of Liberty-Ellis Island Centennial Commission, set up to raise funds for and to oversee restoration of the two monuments. If Iacocca attained prominence through business stewardship, television commercials, and identification with the Statue of Liberty, he gained much additional exposure through his 1984 autobiography. Iacocca: An Autobiography, the best-selling nonfiction hard cover book in history, had two million copies in print by July 1985. Most readers seemed to accept the volume as near-gospel, while others ventured that Iacocca's achievements had lost nothing in the telling and that the author was overly vindictive toward Henry Ford II.

Folk Hero

By the mid-1980s Iacocca had achieved folk-hero status. Typically, the Saturday Evening Post described him as "the sex symbol of America" the Reader's Digest as "the living embodiment of the American dream" and TIME as "a corporate capitalist with populist appeal, an 'eminence terrible' admired by working class and ruling class alike." Talk of Iacocca-for-President became increasingly widespread, and a 1985 poll of 1988 presidential preferences showed that the cocky industrialist trailed Vice-President George Bush by only three percentage points (41 to 38 points).

The late 1980s and early nineties were not as kind to Iacocca. His public image, like Chrysler's earnings, began to fall off. At a time when the American people, in the grip of a recession, renounced the huge paychecks of executives whose companies were ailing, Iacocca who had once achieved a publicity coup when, for a time, he only accepted one dollar a year from Chrysler, was paid a 1987 salary of $18 million. In addition, Iacocca, lambasted Japanese trading practices, blaming them for the ills that American car manufacturers had suffered. Critics cited that the American public believed that Japanese cars were superior and instead of criticizing the Japanese, Iacocca's car company should have been emulating them. At the end of 1992, Iacocca was forced to retire after he had bettered the position of the company for a merger or takeover. He remained a consultant to Chrysler (with a $500,000 a year salary and use of the company jet) until the end of 1994.

In 1995, Iacocca announced that he was suing Chrysler, claiming that it unlawfully blocked him from exercising $42 million in share options that he had earned while he was the chairman. Chrysler claimed that Iacocca's role as an adviser to Kirk Kerkorian, the investor who wanted to purchase the company, violated the share option plan agreement. Although Kerkorian's bid failed to materialize because he was unable to raise the financing, Chrysler agreed to pay Iaccoca $21 million to settle the lawsuit. Iacocca continued to work as Kerkorian's consultant.

Iacocca and Mary McCleary were married in 1956 and had two daughters, Kathi and Lia. Mary died of diabetes in 1983, and in her memory, Iacocca donated his book earnings to diabetes research. In 1986 Iacocca married Peggy Johnson (born 1950), an advertising executive from whom he was divorced in 1996.

Further Reading

The primary source of information about Iacocca is the executive's best-selling Iacocca: An Autobiography (1984), although critics say it was written mostly to stroke Iacocca's ego and to vilify Henry Ford II. David Abodaher's Iacocca (1982), written by an employee of Chrysler's advertising agency, ceaselessly praises the automaker while providing interesting anecdotal material. Perhaps the best of the numerous magazine and newspaper stories on the magnate are New Republic's "What's So Great About Lee Iacocca?," July 16 and 23, 1984; Newsweek's "Behind the Wheels," October 8, 1984; the New York Times's "The Importance of Being Iacocca," December 23, 1984; and Time's "A Spunky Tycoon Turned Superstar," April 1, 1985. Detroit News, "Retirement has been a rough ride for Iacocca," June 1996; Automotive News, June 1996. □

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Iacocca, Lee

Lee Iacocca

Born: October 15, 1924
Allentown, Pennsylvania

American businessman and auto industry executive

After a thirty-two year career with Ford Motor Company, including eight years as president, Lee Iacocca engineered one of business history's greatest comebacks at Chrysler Corporation. His success, coupled with appearances in television commercials and his best-selling book, made him one of the nation's most known and admired businessmen.

Early life

Lido Anthony Iacocca was born October 15, 1924, in Allentown, Pennsylvania, the son of Italian immigrants Nicola and Antoinette. Iacocca grew up in comfortable surroundings learning the nuts and bolts of business from his father who worked as a cobbler, hot dog restaurant owner and a theater owner. Nicola was a businessman who taught his son about the responsibilities of money and the need for a strong drive and a great vision in order to build a thriving business. Nicola also ran one of the first car rental agencies in the country and passed on his love of the automobile to his son.

Iaccoca's enlistment in the military during World War II (1913945) was denied because of his childhood battle with rheumatic fever, a terrible disease that can cause permanent damage to the heart. He earned an undergraduate degree in engineering from Lehigh University and later earned a master's degree from Princeton University. Even as a teenager, Iacocca decided that he was going to be an automobile company executive and focused his studies in that direction. He secured a much sought-after engineering trainee job at Ford Motor Company in 1946, but put off his start until he completed his master's degree at Princeton.

At Ford Motor Company

Joining Ford as an engineering trainee in 1946, Iacocca soon entered the fast pace of sales. In 1960, at age thirty-six, he sped into the vice presidency and general managership of the company's most important unit, Ford Division. In 1964, with others on his staff, he launched the Ford Mustang, which, thanks to brilliant styling and marketing, introduced a new wave of sports cars, set a first-year sales record for any model, gave its name to a generation, and landed its creator's picture on the covers of Time and Newsweek.

In 1960 Iacocca was named Ford's vice president of the car and truck group; in 1967, executive vice president; and in 1970, president. Pocketing an annual salary and bonus of $977,000, the flashy executive also earned a reputation as one of the greatest salesmen in U.S. history. Of Iacocca, it has been said that he was always selling, whether products, ideasor himself.

From Ford to Chrysler

Iacocca was let go from Ford Motor Company in June 1978 by Chairman Henry Ford II for reasons Ford never revealed. Though bitter at being dismissed from Ford, Iacocca was not out of the car business for long. Five months after his dismissal, Iacocca was named president of Chrysler (becoming chairman in 1979) and began transforming the number three automaker from a sluggish moneymaker into a highly profitable business.

How was Chrysler turned around? By downsizing (to make smaller) expenses to a much lower break-even point; by winning approval of $1.5 billion in federal loan guarantees; by selling off profitable units such as the tank division; and by introducing timely products. In addition, Chrysler welcomed, for the first time in U.S. corporate history, a union president to a board of directors. In 1984 the company posted profits of $2.4 billion (higher than in the previous sixty years combined), and in 1985 it bought Gulf-stream Aerospace Corporation for $637 million and E. F. Hutton Credit Corporation for $125 million.

In the early 1980s Chrysler issued the K-car and what would later become its best sellerthe minivan. Just as the Mustang reestablished the sports car for Ford, the minivan would be loved by the young family in need of room and efficiency and revitalize Chrysler. In 1983 Chrysler paid the government back its loans and Iacocca became a star, a symbol of success and the achievement of the American dream.

Along with spearheading Chrysler's rise, Iacocca took leadership roles in many noteworthy causes, most notably the chairmanship of the President's Statue of Liberty-Ellis Island Centennial Commission, which was set up to raise funds for and to oversee restoration of the two monuments in New York City. While Iacocca gained a worldwide reputation through business leadership, television commercials, and association with the Statue of Liberty, he gained much additional exposure through his 1984 autobiography (a book written by someone about their life). Iacocca: An Autobiography, the best-selling nonfiction hardcover book in history, had two million copies in print by July 1985.

Folk hero

By the mid-1980s Iacocca had achieved folk-hero status. The Saturday Evening Post described him as "the sex symbol of America" and Reader's Digest as "the living embodiment of the American dream." Talk of Iacocca-for-president became increasingly widespread, and a 1985 poll of 1988 presidential preferences showed that the cocky industrialist trailed Vice President George Bush (1924) by only three percentage points (41 to 38 points).

The late 1980s and early 1990s were not as kind to Iacocca. His public image, like Chrysler's earnings, began to fall. At a time when the American people, in the grip of a recession (a temporary slowing of the economy), criticized the huge paychecks of executives whose companies were hurting, Iacocca who had once achieved a publicity coup (takeover) when, for a time, he only accepted one dollar a year from Chrysler, was paid a 1987 salary of $18 million. In addition, Iacocca, criticized Japanese trading practices, blaming them for the ills that American car manufacturers had suffered. Critics stated that the American public believed that Japanese cars were superior and instead of criticizing the Japanese, Iacocca's car company should have competed with them. At the end of 1992, Iacocca retired. He remained a consultant to Chrysler, with a $500,000 thousand a year salary and use of the company jet, until the end of 1994.

In 1995 Iacocca announced that he was taking Chrysler to court, claiming that it unlawfully blocked him from exercising $42 million in share options that he had earned while he was the chairman. Chrysler claimed that Iacocca's role as an adviser to Kirk Kerkorian, the investor who wanted to purchase the company, violated the share option plan agreement. Although Kerkorian's bid failed to materialize because he was unable to raise the financial backing, Chrysler agreed to pay Iaccoca $21 million to settle the lawsuit. Iacocca continued to work as Kerkorian's consultant.

Iacocca and Mary McCleary were married in 1956 and had two daughters, Kathi and Lia. Mary died of diabetes (a blood disorder) in 1983, and in her memory, Iacocca donated his book earnings to diabetes research. Two later marriages, to advertising executive Peggy Johnson (1986) and restaurateur Darrien Earle (1990), ended in divorce. In 1999 Iacocca announced his latest venture, E-bikes. Iacocca believes these electronically motorized bikes will take the place of mopeds and other loud and polluting vehicles in crowded urban areas. Only time will tell if Iacocca's latest work will be as popular as his previous successes.

For More Information

Abodaher, David. Iacocca. New York: Macmillan, 1982.

Haddock, Patricia. Standing Up for America: A Biography of Lee Iacocca. Minneapolis: Dillon Press, 1987.

Iacocca, Lee. Iacocca: An Autobiography. New York: Bantam Books, 1984.

Iacocca, Lee A. Talking Straight. New York: Bantam, 1988.

Levin, Doron P. Behind the Wheel at Chrysler: The Iacocca Legacy. New York: Harcourt Brace, 1995.

Wyden, Peter. The Unknown Iacocca. New York: Morrow, 1987.

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Iacocca, Lido Anthony

IACOCCA, LIDO ANTHONY


Lee Iacocca (1924) retired as the Chief Executive Officer (CEO) of the Chrysler Corporation in 1992. He had joined the corporation fourteen years earlier when Chrysler was on the edge of bankruptcy. The company was at the time one of the largest automobile manufacturers in the world, employing thousands of people. Upon entering the company Iacocca convinced everyone involved, including the United States government, to underwrite $1.2 billion in loans to rebuild the company. To obtain this critical support, Iacocca used the legendary salesmanship and public relations skills he had honed while president of the Ford Motor Company. Seemingly by sheer willpower, Iacocca saved Chrysler and its employees from financial ruin.

Lido Anthony Iacocca was born in 1924 in Allentown, Pennsylvania. He was the son of Italian immigrants. Lee, as he preferred to be called, learned about business from his father, Nicola, who was a businessman with many interests. Nicola was a cobbler, the owner of a hot dog restaurant, a theater owner, and the owner of one of the first car rental agencies in the country. Iacocca credits his father with passing on to him a love for the automobile.

Iacocca earned his Bachelor's degree from Lehigh University. He later earned a Master's in mechanical engineering, with a specialty in industrial engineering, from Princeton University. He decided early on to become an auto company executive. After graduating from Princeton in 1946 he joined the Ford Motor Company as an engineering trainee. Within a year he realized that he was far better at selling automobiles than at making them. Iacocca entered the fast-track of sales. In 1960, at age thirty-six, he sped into the vice presidency and general management of the company's most important unit, the Ford division.

In 1964 Lee launched the Mustang automobile. Its attractive styling and successful marketing introduced a new wave of sports cars to the Ford operation. The Mustang earned Iacocca instant fame as an industrial innovator. In 1964 his face was on the cover of both Time and Newsweek magazines. By 1967 he was the executive vice president of Ford Motor Company. In 1970 he became president of the company. His only superior was Henry Ford II (19171987), chairman of the board of Ford Motor Co. For reasons that were never made clear, Chairman Henry Ford II discharged Lee Iacocca in June 1978. It was a shock to many people who saw Iacocca as a natural heir at Ford.

Five months later Iacocca was named president of the rival Chrysler Corporation. He became chairman in 1979 and began turning around the failing corporation. At the time Chrysler was headed for bankruptcy. Iacocca took the number three automaker, deep in debt, and transformed it into a highly profitable enterprise. He began managing expenses by winning approval of over $1 billion in federal loan guarantees. He then sold off profitable units like the tank manufacturing division and introduced new products to the marketplace. He also brought the president of the United Auto Workers onto the company's board of directors.

Within six years Chrysler paid off its debts and posted a profit of $2.4 billion. In 1985 Chrysler bought the Gulfstream Aerospace Corporation for $637 million and the E.F. Hutton Credit Corporation for $125 million.

Under Iacocca's leadership the company put out innovative new vehicles and eventually bought out competitor American Motors Corporation. As Chrysler bounced back to life in the 1980s, Iacocca became an extraordinary business and corporate celebrity. Some of his detractors felt he was a self-obsessed egomaniac, but many analysts of his career regard him as an important U.S. industrial hero of the late twentieth century.

A key product to the resurgence of the Chrysler Corporation was Iacocca's promotion of the K-car "minivan." It was a vehicle loved by the young family in need of room and efficiency. The mini-van largely helped revitalize Chrysler and its public image. It clearly set the trend for the enormous popularity of the sports utility vehicle that claimed much of the auto industry's market in the late twentieth century.

Iacocca continued to be the successful and charismatic CEO of the Chrysler Corporation until his controversial retirement in 1992, during a period when Japanese auto competition was once again hurting Chrysler's profits. He moved into retirement reluctantly after spending much of the previous thirty years of his life as an automobile industry corporate legend. Iacocca remained a major stockholder in Chrysler and in 1995 he became involved in a battle to gain control of the company. In the unsuccessful attempt for control, Iacocca sided with Las Vegas financier Kirk Kerkorian and was strongly criticized.

Iacocca's impact on the auto industry was controversial, but undeniable. He saved the Chrysler Corporation and turned it into a profitable business. In 1998, even in retirement, Iacocca was still involved in the auto industry, investigating the market for electric cars in California.

See also: Automobile Industry, Chrysler Corporation


FURTHER READING

Gordon, Maynard M. The Iacocca Management Technique. New York: Dodd Mead, 1985.

Iacocca, Lee A., and William Novak. Iacocca: An Autobiography. Toronto; New York: Bantam Books, 1984.

Jefferys, Steve. Management and Managed: Fifty Years of Crisis at Chrysler. Cambridge; New York: Cambridge University Press, 1986.

Levin, Doron P. Behind the Wheel at Chrysler: The Iacocca Legacy. New York: Harcourt Brace, 1995.

Wyden, Peter. The Unknown Iacocca. New York: Morrow, 1987.

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Iacocca, Lee

Lee Iacocca (Lido Anthony Iacocca) (ī´əkō´kə), 1924–, American business executive, b. Allentown, Pa. In 1946 he joined the Ford Motor Company, where he rose to president (1970–78). He left the company after a dispute with Henry Ford II and became president (1978) and then chairman (1979) of the Chrysler Corp., restoring it through shrewd financial policies, a $1.2 billion loan guarantee, and tax concessions granted by Congress. In the 1980s, he also served as chairman of the Statue of Liberty–Ellis Island Foundation and engineered Chrysler's $1.5 billion acquisition of American Motors. Iacocca retired at the end of 1992, but in 1995 he aided billionaire Kirk Kerkorian in his unsuccessful attempt to win control of Chrysler.

See his autobiography, written with W. Novak (1984); P. Wyden, The Unknown Iacocca (1987); D. P. Levin, Behind the Wheel at Chrysler (1995).

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