In my recent CC about a 1977 Ford Granada, I made an assertion about the cars Lee Iacocca was involved with at Ford not having enduring appeal in the showroom.
Not one to simply make assertions, here’s proof.
We have seen this sales graph for the Granada.
During the 1970s, Lee Iacocca was involved in several other endeavors, such as the Maverick.
For reference, I’ve included the Mercury Comet clone. I realized I did not include the Mercury Monarch with the Granada, although you will soon see the sales numbers of Mercury products had little effect on the overall picture.
Iacocca also had a hand in the Pinto and its clone, the Mercury Bobcat, that came along a few years later.
Are we seeing a pattern yet?
Perhaps Iacocca is most known for his involvement with the Ford Mustang. It was quite the sales success. Initially.
But might it have set the pattern seen with other models during the 1970s?
Proving this isn’t a hit piece on Iacocca, let’s not forget his influence upon the Lincoln Mark III.
This rather breaks the trend, does it not? In fact, one could argue the Lincoln Mark III may have been Iacocca’s most successful offering while at Ford as its successor continued on the Mark III’s trajectory.
There are a multitude of other factors influencing everything we’ve seen here – a fuel crisis, inflation, political drama, plus other factors I’m undoubtedly not thinking about.
Yet my basic point remains…Iacocca, known for his craftiness and ability to appeal to the masses, was rarely able to generate enduring appeal. At least not at Ford.
Lee Iacocca became kind of a folk hero when he saved Chrysler in the 1980s. Also him appearing in commercials cemented and enhanced his folk hero status. He was a good marketer at Ford but the success of his products except for the Mustang only weren’t long term. He was able to maximize the use of car platforms though in different forms. I still admire him for saving Chrysler and the Mustang.
In all fairness to Lee Iococca, car prices were tripling over 4 years from CarterFlation at the end of 1970s, but wages weren’t, so that was the main driver of sales plummeting! ( I did my part and bought a new ’77 GP… LOL! … but couldn’t afford an ’81 GP at 3 times the price).
What car prices tripled in the late seventies? Utter nonsense.
Cars prices tripling? Um, no. The MSRP of a 1976 Chevy Caprice was $5,013. A 1980 Caprice cost $7,161. Most other vehicles had similar increases.
A ’77 GP base priced at $5120 according to JD Power
A ’81 GP base priced at $7862 according to JD Power
That’s a 53% increase. While not insignificant it’s nowhere near doubling, never mind tripling. It’s not difficult to look up facts like this. Let’s continue:
In 1977 the minimum wage was $2.60 an hour
In 1981 the minimum wage was $3.35 an hour.
That’s a 28% increase. While a welcome increase, it’s a problem if someone works at McD’s and wants a new car every four years.
However,
In 1977 the median family income was $13570 according to census.gov
In 1981 the median family income was $22390 according to census.gov
That’s a 65% increase.
The Grand Prix hence appears to have gotten more affordable for the median family between 1977 and 1981 when only comparing income vs list base prices.
Sources:
1977 family income: https://www.census.gov/library/publications/1978/demo/p60-117.html#:~:text=The%20median%20money%20income%20of,was%20eroded%20by%20rising%20prices.
1981 family income:
https://www.census.gov/library/publications/1983/demo/p60-137.html#:~:text=In%201981%2C%20the%20median%20family,the%20change%20in%20consumer%20prices.
Thank you for taking the time to put together this response. Unfortunately this commentator has a habit of throwing things out there that often lack any basis in reality. I responded to him a couple of times but I doubt he even reads responses to his comments. So I’ve just given up.
Our commenting policy states that comments that become tedious and/or obnoxious are not permitted. His comments are starting to run afoul of that. I’m thinking we should also add something about misinformation. It’s one thing to disagree on opinions and such; it’s another thing to make statements that are blatantly incorrect. It’s comment pollution. And we shouldn’t have to spend our time cleaning it up.
The commentary at CC is a highlight of the site and a vast repository of knowledge. It should not be tarnished. Commenting should thus be a privilege, not a right, since misinformation (in any context and commonly known as “a lie”) is a malignant cancer and corrosive. And failing to stand up to it is capitulation that doesn’t end well.
Opinions are welcome and debatable. Facts are welcome and not debatable. “Alternative facts” are not welcome, they are lies and should be called out for what they are.
Pinto, Maverick, Granada – once introduced Ford appeared to have lost interest. They were not updated in any serious way but left to wither and die. This is not a reflection on Iacocca’s original idea but more one on Ford management. The Marks were kept current and did well. The Mustang ran into competition that was not there when introduced (the Valiant/Barracuda doesn’t count). Lee was far from perfect but you can’t hang all of the decline on his ideas.
A couple of things to keep in mind about the context of the Maverick and Granada.
The Maverick’s first year was a long one that no doubt helped it post such high first year numbers. When introduced it was Ford’s lowest price entry. That role was quickly taken by the Pinto. So not really surprising that it saw such a significant drop from the 1st to second year, between the extended first model year and there being a new addition for the person who was just looking for the most economical car in the show room.
Ford was also surprised when the take rate for the LDO Maverick was so high, and of course not surprised that it saw a bounce in sales due to the first Energy crisis. Because of that the decided that it would soldier on as the entry level compact while what had been intended as a direct replacement the Granada was moved up market as their premium compact. So considering that the 1975 up Maverick was just seen as a cash cow, that was fully amortized and competing with the Pinto for those looking for the best price and economy, and the Granada for those looking for a nicer compact I think it did pretty well in 75-77.
The Granada suffered a similar fate when the Fairmont was introduced as Ford’s new compact for 1978. Not sure if Ford had intended for the Fairmont to directly replace the Granada on not but it definitely didn’t help the Granada’s 78-80 sales numbers. So for 78-80 the Granada took over as that fully amortized cash cow that they might as well keep cranking out for a few more years past its original sell by date.
It would be interesting to see a graph with combined Maverick, Granada, and Fairmont numbers for 1970-1980. On second thought since the Granada got a second generation based on that Fairmont maybe that graph should run from 1970-1982.
The Pinto also faced some competition from inside the Ford showroom starting in 1978 with the introduction of the Fiesta which was the new Ford MPG champ with the more modern FWD architecture and better space utilization.
Jason attached the receipts, and I’m here for it.
Don’t forget that the Falcon was Robert McNamara’s baby: the stripper original 1960 Falcon was his idea of the perfect car. When he was picked as JFK’s defense secretary he was President of the Fomoco. Ford was a strong Number 2 to Chevrolet all those years and was as successful as it was because they figured out market niches (launch of 1949 Ford) and Lee Iacocca was a very shrewd marketer. From his autobiography he came up with memorable tag lines like “A (19)56 Ford for $56”, he attached himself to product shots and got coverage in Life Magazine. He was Steve Jobs before his time. But he was fired by Henry Ford II: the Mark Lincolns were Mr. Ford’s idea of a great car. You’ll need to remember that Ford, was and is, a family-run company.
Very interesting. So Lido had a knack at Ford for a flash in the pan with his products. I suppose the only car that comes to my mind that did really well was the 1977-1979 Thunderbird. But then, I don’t really know how little or much influence he had on those.
I can say that when I look at our 1978 Thunderbird Diamond Jubilee, it screams of Brougham Excess.
Great article
I don’t believe this kind of trajectory is particularly unique but actually a fairly common sales trend over time for newly introduced models.
I worked for an Ad agency that was very involved with Chrysler at the time of the Iaococca lead bailout or government backed loan guarantees as he was quick to correct anyone who called it anything else..He was one of those people who just generated an air of importance. Any room would suddenly become quieter when ever he walked in..And he was so very smart and perceptive..When ever he was interviewed or held a press confirence he would anticipate what the interviewer’s question was before two sentences were spoken and break in with the answer..It was a tuff call to include his image in any print or TV ads because he actually wasn’t a very handsome figure.
I think Iacocca had a genuine salesman’s gift for knowing when something would sell. John DeLorean had that gift too. It is interesting that both of them were trained as engineers, and that both found engineering too confining for themselves.
I guess to the salesman, having something new and hot to replace the thing that was new and hot two or three years ago is key. The Maverick was new and hot as a replacement for the Falcon, and the Pinto was new and hot right on the Maverick’s heels.
I have never figured out if the poor long-term durability of Fords during the Iacocca years can be laid at his doorstep, or is the result of a corporate culture that prized current results so much that costs were cut to make them happen. It is probably no coincidence that the Chrysler of post-1980 took on many of Ford’s best and worst features. Products of “the new Chrysler” were very appealing in showrooms, but as time wore on they became quite brittle over the long term and were not good choices over the long haul as, say, Fords from the early 60’s or Mopars through the 70’s had been.
Well, I can relate to Iacocca (and DeLorean) in a sense. Engineering can be confining as I long ago discovered.
The durability component, I think, cannot be attributed solely to Iacocca. I think it was culture as you stated plus perhaps a smidgeon of a company wanting to take the cheap route to accomplish various mandates.
Outside of LTDs, it never seemed Ford’s passenger cars for the bulk of the 1970s were the most durable. Anecdotally, I remember seeing mid-70s LTDs on the road for many years after all the Mavericks, Granadas, and Pintos ceased to motivate.
The key thing about all of these were that they essentially created new market segments. As such, they stimulated a lot of interest when new, as a large segment of the population tends to be stimulated by something new. But that often fades. The AMC Pacer had a similar spike and drop, as did the Chevy Citation. They both defined a new market segment.
But there were some key factors that explain all of these, almost all external factors:
The Pinto jumped in 1974 strictly in response to the energy crisis. The Vega had its best year in 1974 too. External factors can make huge impacts. The 1958-1961 recession absolutely made Rambler and gave the Lark a huge boost that kept Studebaker alive for a few more years. If that recession hadn’t happened, both would have been dead by 1960 or 1961.
The Granada also got a big boost from the post-energy crisis move away from big cars. But the big success of GM’s downsized ’77 B-bodies undoubtedly impacted it.
The Mustang had nowhere to go but down, due to competition from the Camaro and then the inevitable loss of excitement about the pony car segment as it got old.
The Maverick had an extra-long first year and then in 1971 the Pinto ate its lunch. It was really mostly a quick stop-gap until the Pinto launched.
The Mark IV got off to a strong start in 1973 but the energy crisis dented that in 1974 and 1975.
An excellent point about new markets.
I was thinking of this from the angle of there being no second generation Maverick or Pinto, the second generation Granada was short lived and nothing spectacular, and the Mustang II was reimagined into the ’79 Mustang. In turn, I was thinking of other names such as Accord, Civic, Passat, and others that came about during roughly that same time period yet remained viable in the marketplace. Admittedly, they weren’t creating new markets.
Good points. This was the big difference between the domestic and imports: the domestics tended to endlessly reinvent the wheel starting in the early ’70s because of the energy crisis 1&2 and because of the surging imports. Starting at this time, the domestics were essentially perpetually in a defensive mode, trying to adapt to a rapidly changing market. But the imports just mostly stayed steady, as in the classic case of the Civic and Accord. They were the aggressors, and destabilized the domestics, who took way too long to figure out how to compete (or just abdicate large segments of the market). Toyota and Honda still sell very healthy numbers of Camrys, Corollas, Accords and Civics. The domestics long gave up on that segment.
A little, but they sold 47,145 in 1975, only slightly fewer than in 1972, and more than 56,000 in 1976, which was very good. The five-year average worked out as 55,720 units a year, and demand exceeded supply through much of that period.
I have to think a major part of the sales decline for the Mustang had everything to do with the 1967 introduction of the Camaro and Firebird.
AI tells me over 300,000 of those pony cars were sold in ’67.
Seems like a quote often attributed to Iacocca (“sell the sizzle, not the steak”) would go a long way to explaining the theory about the short longevity of new Fords championed by Iacocca. IOW, the sizzle of many of Iacocca’s new cars flamed-out well before the steak was cooked.
Then, too, there’s the clever marketing scheme of introducing cars in mid-year that were technically the next year’s model, making for some astounding sales numbers that didn’t jibe with the numbers of other, successful models that were introduced in the normal September new car cycle.
Even with those machinations, there’s no denying Iacocca’s general skill at perceiving domestic tastes. He had a long, enviable, successful auto industry run in not just one, but two of the Big 3 companies that can’t be denied.
He was directly responsible for not one, but two of the biggest gamechangers in auto history (Mustang and Chrysler minivan) and myriad other successes.
Having had a Mercury Zephyr (same car as the Granada with nicer trim) I think the reason for their sales decline was the planned obsolescense of the FoMoCo cars of the era. I typically keep a car for over 20 years. Some of my cars I have had for over 50.
But that car self-destructed. Gas door broke first. Plastic trim did not hold up. AC died. Transmission went bad in 3 years. My father started buying Toyotas in response. I started buying solid but unwanted $200 junkers when I had to give up on the Zephyr. I’d add $1500 to my $200 finds, to bring them up to prime condition. And I would have a reliable car, which the Fords of that generation were not.
I must not have been the only person to tell others to avoid buying those cars. The sales dropped off because the cars were bad as transportation.
Will there be a part two tomorrow, reporting on Iaccoca’s full career?
During the bulk of Iacocca’s tenure at Chrysler, their reputation for quality improved significantly over their ’70’s reputation. From the early ’80’s until the early ’90’s, Chrysler products earned an improved reputation for reliability, rust-resistence, longevity, and affordable service and parts. If their products weren’t the most refined, or primarily based upon the K-Car platform.
They introduced the high profile 5 year, 50,000 mile, no rust through warranty. They were early adopters of widespread space efficient front wheel drive through their lineup. They regularly refined, and improved their products, as manual transmissions became more precise, and turbos supplemented their small engines. They were early adopters of standard air bags. As the K-cars, L-Bodies (Omni/Horizon), P-Bodies (Shadow/Sundance) and Minivans, all maintained solid sales, through their production runs.
To maintain interest in products later in their lifecycles, Chrysler introduced ‘America’ editions of popular car lines. Which re-stimulated interest, and provided good value. Their high profile association with Carroll Shelby, brought some of the best known domestic performance cars of the ’80’s. Chrysler consistently competed on price, offering excellent value, if not class-leading refinement.
For over a decade under Iacocca, Chrysler was a model of stability. Highly unique for them.
Whether you consider him a shill or not, he presented himself as the face of Chrysler’s comeback. Early ’80’s Chrysler came across vastly better than any period of ’70’s Chrysler. Even if key products were developed before him.
It was brilliant marketing, putting a familiar face on that comeback. Like a smooth politician, his early commercial positive pep talks touting the K-Cars, and minivans were highly effective. As the products were solidly built, and made to last. Unlike the Maverick and Pinto.
Imagine Roger Smith doing patriotic commercials for GM. lol
I’m sure he would ooze sincerity.
Whether one considers him a salesman or not. His frontman spokesperson status all through the ’80’s, was a powerful tool and aid, for Chrysler marketing.
Speaking of Iacocca and Chrysler, there’s an interesting article on Hemmings although it didn’t mention the introduction of the “lower priced full-size” Dodge Dart and the 1962 “plucked chicken”. https://www.hemmings.com/stories/what-in-the-heck-was-going-on-with-chrysler-in-the-1970s/
Great timely and in-depth article Stéphane, summarizing Chrysler of the ’70’s and ’80’s. Thank you, for posting it.
That 1987 purchase of AMC/Jeep, turned out huge by the early ’90’s.
I’m ten years ahead of you! 🙂 Here’s a link to production numbers I embedded into a piece from 2015 about the chronology of the Chrysler K-cars.
https://www.curbsideclassic.com/wp-content/uploads/2015/01/K-Car-and-Derivative-Production.pdf
This was outstanding Jason. I recall this article. Thank you for pulling it up. Great reading.
“Sell the sizzle, not the steak” is a very old-school style of sales, and Lido was embedded in it, and the world passed him by. Even in his tenure at Chrysler, a lot of what he did was putting lipstick on a pig. Recall that the K-cars were already in development by the time he got the job, and he spent a whole lot of effort in making “new” models by adding gingerbread to K-cars. Aside from the T-body minivans, everything was derivative, but not in a good way. The 1980s were a new world, but Iacocca was stuck in the old world.
I’m going to disagree in the sense that the charts show Iacocca knew how to design/build a hit, and once situated interest was lost due to the lack of updating or better products came along.
I also wish the Detroit brands kept the momentum going with 4-5 year updates and consistency of names. Paul has addressed this before; I for one think it’s awesome that the Corolla (and Civic) have been going for 50+ years, yet you know what one is.
Look at from the prospective of Ford Motor Company North American operations:
– most of what Lido introduced was from exiting structures or platforms
– most used existing engines or transmissions (the most expensive components on a vehicle)
– drew folks into the show room who may end up buying a Torino or Mustang or T-Bird or Cougar instead
– both Lincoln and Mercury benefited from parallel Ford vehicles filling their showrooms with desired products with minimal development costs. A good example is the ’67 Cougar or ’75 Monarch
– with initial high volume sales, FoMoCo was able to reach break even early in the life cycle. Past a certain point, production cost dropped
– need to mention the T-Bird of ’77 thru ’79 plus the Mustang II. Both cash cows that financed the Panther and Fox platforms.
Sizzle over substance my describe what Lido did. However, “cash flow” is paramount in the auto world. You need something to draw customers into the show room and leave with your vehicle. That’s the name of the game in this business.
Yup, the Mustang, Maverick and Granada were relatively cheap to bring to market with the design and tooling for major parts of the car already fully amortized before production began. Ditto for the Mustang II and downsized T-bird. So yeah they were cash cows that kept the lights on and provided development money for future products. Which of course also had long lives and in the case of the Fox spawned a number of permutations including a new Mustang, Granada and T-bird.
The early introductions also played a big part in those high first year numbers and of course pretty much guaranteed there was no where to go but down with a standard length production period in the second year.
The fact that Lido kept making K-cars through 1994ish…wondering what the sales numbers were when the Dodge Shadow, Dodge Spirit, et al. were looking a decade out of their times.
Here you go…
https://www.curbsideclassic.com/wp-content/uploads/2015/01/K-Car-and-Derivative-Production.pdf
That gave me the impression his ability to read the industry was reaching its use-by date.
Early sketches of the LH cars, that appeared close to their final versions, were out in 1991.
Chrysler had the advanced LH cars, meant to at least leapfrog the domestic competition, in the queue.
Selling the Acclaim/Spirit, until the Vision/Concorde/Intrepid were ready.
Who cares about enduring when over the model run of the Mustang, Maverick, Pinto or Granada well over a millions units were sold for each not including platform mates. The 2nd gen Mark hovered around 50k units during it’s run which is very good for a car of it’s ilk. If I’m an investor I say Right On Baby, Right On!
I initially thought that as well. But sustained car sales are important to keep dealers making money, later in a mass market car’s lifecycle. Sales Departments, Service Departments. Especially if large departments have to be scaled back, due to lost business.
Iacocca knew how to take leftovers, and make them seem fresh and new. The Mustang, the Maverick and the first gen Granada were Falcons. The “downsized” Thunderbird was a Torino. The LTD was a Galaxie. Iacocca could take yesterday’s potatoes and turn them into pancakes for breakfast, potato leek soup for lunch, then cold Vichyssoise for an elegant French dinner.
Not everyone bought leftovers, and within a few years, they passed their expiration dates, but Iacocca knew how to get sales winners today and tomorrow, using items you didn’t know you already had. In a way, a Falcon owner that trades in for a new Mustang, then a Maverick, then a Lincoln Versailles is a repeat Falcon customer!
“In a way, a Falcon owner that trades in for a new Mustang, then a Maverick, then a Lincoln Versailles is a repeat Falcon customer!”
Good point.