Lee Iacocca, Engineer Of Chrysler's Turnaround, Dies At 94

DETROIT (CBS DETROIT) — The mastermind behind the Ford Mustang and Pinto cars as well as being credited with Chrysler's rebirth has died.

Lee Iacocca, the auto executive and master pitchman who became a corporate folk hero when he resurrected Chrysler 20 years later, has died in Bel Air, California of natural causes. He was 94.

Business icon Lee Iacocca speaks after he receive honors at the Ellis Island Family Heritage Awards at the Ellis Island Immigration Museum at the Great Hall on Ellis Island April 13, 2011 in New York. AFP PHOTO / TIMOTHY A. CLARY (Photo credit should read TIMOTHY A. CLARY/AFP/Getty Images)

Two former Chrysler executives who worked with him, Bud Liebler, the company's former spokesman, and Bob Lutz, formerly its head of product development, said they were told of the death Tuesday by a close associate of Iacocca's family.

In his 32-year career at Ford and then Chrysler, Iacocca helped launch some of Detroit's best-selling and most significant vehicles, including the minivan, the Chrysler K-cars and the Mustang. He also spoke out against what he considered unfair trade practices by Japanese automakers.

The son of Italian immigrants, Iacocca reached a level of celebrity matched by few auto moguls. During the peak of his popularity in the '80s, he was famous for his TV ads and catchy tagline: "If you can find a better car, buy it!" He wrote two best-selling books and was courted as a presidential candidate.

But he will be best remembered as the blunt-talking, cigar-chomping Chrysler chief who helped engineer a great corporate turnaround.

BEVERLY HILLS , CA - OCTOBER 18: Chrysler Chairman Lee Iacocca attends the unveiling of the new Mercedes-Benz Maybach 57S at Mercedes Benz of Beverly Hills on October 18, 2005 in Beverly Hills, California. The 605 HP V12 twin-turbo 57S sports a pricetag of $360,000 and is custom built to order with options like a champagne refrigerator and dual 9.5" flat screen monitors. (Photo by Matthew Simmons/Getty ImagesIn 1979, Chrysler was floundering in $5 billion of debt. It had a bloated manufacturing system that was turning out gas-guzzlers that the public didn't want.

When the banks turned him down, Iacocca and the United Auto Workers union helped persuade the government to approve $1.5 billion in loan guarantees that kept the No. 3 domestic automaker afloat.

Iacocca wrung wage concessions from the union, closed or consolidated 20 plants, laid off thousands of workers and introduced new cars. In TV commercials, he admitted Chrysler's mistakes but insisted the company had changed.

The strategy worked. The bland, basic Dodge Aries and Plymouth Reliant were affordable, fuel-efficient and had room for six. In 1981, they captured 20% of the market for compact cars. In 1983, Chrysler paid back its government loans, with interest, seven years early.

The following year, Iacocca introduced the minivan and created a new market.

The turnaround and Iacocca's bravado made him a media star. His "Iacocca: An Autobiography," released in 1984, and his "Talking Straight," released in 1988, were best-sellers. He even appeared on "Miami Vice."

A January 1987 Gallup Poll of potential Democratic presidential candidates for 1988 showed Iacocca was preferred by 14%, second only to Colorado Sen. Gary Hart. He continually said no to "draft Iacocca" talk.

In the years before his retirement in 1992, Chrysler's earnings and Iacocca's reputation faltered. Following the lead of Ford and General Motors, he undertook a risky diversification into the defense and aviation industries, but it failed to help the bottom line.

Still, he could take credit for such decisions as the 1987 purchase of American Motors Corp. Although the $1.5 billion acquisition was criticized at the time, AMC's Jeep brand has become a gold mine for now Fiat Chrysler Automobiles as demand for SUVs surged.

Early Life

Iacocca was born Lido Anthony Iacocca in 1924 in Allentown, Pennsylvania. His father, Nicola, became rich in real estate and other businesses, but the family lost nearly everything in the Depression.

After earning a master's degree in mechanical engineering at Princeton University, Iacocca began his career as an engineering trainee with Ford in 1946. But the extrovert quickly became bored and took the unconventional step of switching to sales.

He said a turning point in his career came in 1956, when he was assistant sales manager of the Philadelphia district office ranked last in Ford sales nationwide. Iacocca's devised a financing plan called "56 for 56," under which customers could buy a 1956 Ford for 20% down and payments of $56 a month for three years. The district's sales shot to the top, and Iacocca was quickly promoted to a national marketing job at company headquarters in Dearborn, Michigan.

By 1960, at age 36, Iacocca was vice president and general manager of the Ford division.

Iacocca's first burst of fame came with the debut of the Mustang in 1964. He had convinced his superiors that Ford needed the affordable, stylish coupe to take advantage of the growing youth market.

He broke from tradition by launching the car in April rather than the fall. Ford invited reporters to a 70-car Mustang rally from New York to Dearborn, which generated huge publicity. The car made the covers of Time and Newsweek the same week.

In 1970, Iacocca was named Ford president and immediately undertook a restructuring to cut costs as the company struggled with foreign competition and rising gas prices. Iacocca's relationship with Chairman Henry Ford II became strained, and in 1978, Ford fired Iacocca. Henry Ford II later described Iacocca as "an extremely intelligent product man, a super salesman" who was "too conceited, too self-centered to be able to see the broad picture," according to interview transcripts published by The Detroit News.

Iacocca got the last laugh. He was strongly courted by Chrysler, and he helped cement its turnaround in the 1980s by introducing the wildly successful Dodge Caravan and Plymouth Voyager minivans.

Snoop Dogg Lee Iacocca Chrysler Commercial by acgcars on YouTube

In July 2005, Iacocca returned to the airwaves as Chrysler's pitchman, including a memorable ad in which he played golf with rapper Snoop Dogg.

Chrysler wasn't faring well. In his 2007 book "Where Have All the Leaders Gone?" Iacocca criticized Chrysler's 1998 sale to the Germany's Daimler AG, which gutted much of Chrysler to cut costs.

As the recession began, sales worsened, and soon Chrysler was asking for a second government bailout. In April 2009, it filed for bankruptcy protection.

"It pains me to see my old company, which has meant so much to America, on the ropes," Iacocca said.

Chrysler emerged from bankruptcy protection under the control of Italian automaker Fiat. In a 2009 interview with The Associated Press, he urged Chrysler executives to "take care of our customers. That's the only solid thing you have."

Iacocca was also active in later years in raising money to fight diabetes. His first wife, Mary, died of complications of the disease in 1983 after 27 years of marriage. The couple had two daughters, Kathryn and Lia.

In recent years Iacocca was battling Parkinson's Disease.

Iacocca's youngest daughter confirmed he passed away of natural causes Tuesday. He is survived by two daughters and eight grandchildren.

© 2019 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this story. 

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