Lee Iacocca (1924– ) automobile executive

Lido (Lee) Anthony Iacocca was born in Allentown, Pennsylvania, on October 15, 1924, to Italian immigrants. His father was a successful businessman who lost most of his wealth during the Great Depression, but imparted a love of automobiles to his son. Iacocca graduated from Lehigh University in 1945 intent upon becoming an automotive engineer, and he relocated to Dearborn, Michigan, as an executive trainee with the Ford Corporation. After a brief period with the company Iacocca departed for Princeton University, where he obtained a master’s degree in industrial engineering. Back at Ford he decided that he was better at selling cars than designing them and switched his career over to sales. Iacocca possessed an uncanny knack for persuasion, and he rose quickly through Ford’s promotional department. By 1960, as he confidently predicted during his undergraduate years, Iacocca had become vice president of the automotive division of Ford at the age of 36. In this capacity, he convinced a reluctant company president, Robert S. MacNamara, that a new, sporty car design was needed to attract the growing youth market. In 1964, Iacocca’s suggestion came to fruition in the form of the Mustang, a low-cost sports vehicle that broke all existing sales records for Ford products. His success resulted in promotion to executive vice president in 1967 and president of the company three years later. Iacocca, now an internationally recognized corporate celebrity, continued serving Ford successfully until he ran afoul of company chairman Henry Ford II, who dismissed him in June 1978 for reasons that have never been explained.

Iacocca rebounded from this reversal with typical panache when he was installed as president of the CHRYSLER CORP., one of the automotive “Big Three.” The company had been hit by sagging sales, unimaginative engineering, and a debt approaching $6 billion. Iacocca threw himself into the task of rescuing the ailing giant by personally visiting all Chrysler plants, talking with workers about the need for sacrifice, and streamlining overall operations. His drastic strategy included selling off profitable parts of the company, such as its army tank division, and tooling up for new and better products. To better ensure union harmony and support during this austerity period, Chrysler became the first-ever American manufacturer to place the head of the auto worker’s union on the corporate board. Moreover, he managed to win an unprecedented loan from the federal government totaling $1 billion. Iacocca then took his offensive to the airwaves and became Chrysler’s best-known salesman through a series of tough-talking commercials. Invariably he assured the public of the company’s impending return to solvency and offered revolutionary incentives such as an unconditional refund within 30 days. Within a few years, he dramatically turned around Chrysler’s fortunes, paid off all its debts, and began posting record profits. Iacocca was also personally responsible for creation of the new K-car and the minivan, which he felt would be attractive to struggling young families. His sagacity and ingenuity again paid dividends, and by 1985, Chrysler was positioned to acquire new properties such as the Gulfstream Aerospace Corporation and the E. F. Hutton Credit Corporation. Iacocca’s rescue of the company—and the thousands of jobs it represented—again catapulted him into the ranks of national celebrity. His reputation was further abetted through his numerous ads, public appearances, and a highly regarded set of memoirs.

Iacocca remained at the helm of Chrysler until 1992, when the American auto industry was again buffeted by stiff competition from efficient Japanese imports. That year he concluded 30 years of distinguished service as an AUTOMOTIVE INDUSTRY executive by retiring from the board, although he received the sinecure of a major stockholder. In 1995, Iacocca became embroiled in a controversial and unsuccessful attempt to take control of Chrysler in concert with Las Vegas financier Kirk Kerkorian. He has since withdrawn from the public sector, although as late as 1998 Iacocca was pursuing the idea of mass-produced electric cars. His bravura and timely rescue of Chrysler remain the stuff of legend.

Further reading

• Gordon, Maynard M. The Iacocca Management Technique. New York: Dodd, Mead, 1985. 
• Iacocca, Lee A. Talking Straight. New York: Bantam Press, 1988. 
• ———. Iacocca: An Autobiography. Boston: G.K. Hall, 1984. 
• ———. I Gotta Tell You: Speeches of Lee Iacocca. Detroit: Wayne State University Press, 1994. 
• Jeffreys, Steve. Management and Managed: Fifty Years of Crisis at Chrysler. New York: Cambridge University Press, 1986. 
• Levin, Doron P. Behind the Wheel at Chrsyler: The Iacocca Legacy. New York: Harcourt Brace, 1995. 
• Wyden, Peter. The Unknown Iacocca. New York: Morrow, 1987. 

John C. Fredriksen