The mid-1970s were a tumultuous time for domestic automakers, with tried-and-true buyer preferences for “longer, lower, wider” morphing into “smaller and more logical,” even for more upmarket cars. European brands like Audi, BMW, Mercedes-Benz and Volvo were beginning to gain an unexpected foothold with affluent buyers, and the trend was exacerbated by the 1973 Oil Embargo, which made the merits of more efficient products even more apparent. Detroit finally had to respond, but how? Car and Driver took a look at the new “International-sized” premium segment in the May 1977 issue, comparing the new entrants from Lincoln, Chrysler and Dodge with the still-fresh, segment-leading Cadillac Seville.
As Detroit’s product planners, engineers and marketers plotted their strategy to appeal to buyers seeking upscale, smaller cars, they faced a significant strategic challenge: should they holistically develop functional products with sophisticated suspensions and more European handling characteristics, or just shrink the traditional big American car?
Detroit couldn’t quite come to grips with the reasons why an ever-growing subset of buyers in the premium market were snapping up pricey European imports. Motown was mystified by cars that were so “foreign,” designed around benefits that no American “should” want. For example, the premium German makers, all located in Southern Germany, prioritized maneuverability, handling and the capability for safe and comfortable high-speed travel. The cars were expected to perform well on the the high-speed German Autobahns, as well as winding mountain roads like the ones found in the nearby Black Forest region. These roads defined the everyday experiences for the teams in Stuttgart (Mercedes-Benz), Ingolstadt (Audi) and Munich (BMW). The cars simply reflected that reality, and were well-designed for their intended mission. Of course, these merits also played well on the American Interstate Highway system as well as the canyons of Bel Air, California.
In sharp contrast, life in Detroit centered around delivering isolation. Get out of the city, ignore the potholed roads, envelope yourself in a quiet cocoon—these were the desired benefits, made even better if the neighbors could tell that you’d spent a lot of money on a car. The epitome of the “good life” in the Motor City was embodied by places like Bloomfield Hills, Michigan, a posh bedroom community of Detroit chockablock with senior-level auto industry executives (Lee Iacocca called it home). The most strenuous local drives consisted of hurtling as quickly as possible through the pockmarked streets of Detroit, moseying over to a nearby country club, or taking the relatively flat, speed-limited interstates to a Michigan lake house on weekends. As long as you had enough chrome-dipped, vinyl-topped “grandeur” so the hoi-polloi could see that you were “loaded,” then the domestic luxury car mission was accomplished.
Detroit’s notoriously cheap bean counters also loved this domestic approach to luxury, since humdrum cars could be tarted-up for premium market duty with minimal corporate outlay. No need for expensive, sophisticated suspensions or powertrains, just lots of low-cost sound-deadening materials and plenty of fake wood trim. If that approach worked on big cars, then why not small cars?
Cadillac fired the first shot with the Chevrolet Nova-based Seville, introduced in 1975. For a conservative division of GM with a conservative clientele, the small(ish), angular Seville was a rather radical departure from the norm, so Cadillac was careful to maintain the traditional brand benefits in a tidier package. In a genius marketing move, the “baby” Cadillac also carried the highest base price in the line-up (limousines excepted), reassuring Cadillac buyers that their neighbors would know that they had bought the “best.” It was also no coincidence that the price of a loaded Seville was near that of the ’75 Mercedes-Benz 280 ($15,057–$63,511 adjusted).
The American market was hungry for upscale cars with less-than-leviathan dimensions, so the Seville proved to be quite a success, with 16,355 sold in the shortened 1975 model year and 43,772 sold for 1976. While these sales were still well below those achieved by the volume DeVille series, they were ahead of the former top-of-the-line Fleetwood Brougham (43,255 combined for ’75 and ’76). Plus, with a base price of $12,479 ($52,637 adjusted), the nicest Nova money could buy also yielded an enormous profit for GM. The fact that the majority of Seville buyers were domestic luxury owners seeking a more maneuverable car did not matter one bit—it was still a Cadillac.
Obviously, this small car success at arch-rival Cadillac did not sit well over at Lincoln. Like GM, FoMoCo had also determined that a broader array of small cars would become increasingly important in the 1970s, and models like the ’74 Ford Mustang II, and ’75 Ford Granada/Mercury Monarch represented the Blue Oval’s push into more premium small cars. These products were vintage Lee Iacocca babies—plenty of schmaltz layered onto plebeian underpinnings. So when the Baby Cadillac proved to be a hit, Lido commanded a Baby Lincoln to compete, replete with Lincoln Mark styling flourishes front and rear.
However, unlike Cadillac, which actually spent some money modifying the Nova, the transformation of the Granada/Monarch into the Lincoln Versailles was mostly minor cosmetics. No wheelbase stretch, no major modifications to sheet metal (aside from minor nose and tail treatments), no unique engines. Even the Granada/Monarch dashboard was essentially unchanged. Rear disc brakes were the primary functional difference versus the cheaper Ford and Mercury. Oh yeah, there was also “better” paint. The Versailles’ price, however, was ambitious. Lincoln copied Cadillac by giving their smallest car the highest base price in the line—at $11,500 ($45,546 adjusted), the gussied-up Granada offered a dubious value proposition at best.
Over at Chrysler headquarters, the newly-introduced compact Dodge Aspen/Plymouth Volaré were re-imagined as the more upmarket Chrysler LeBaron and Dodge Diplomat. Sharing the 112.5-inch wheelbase with the Aspen/Volaré sedans, Mopar’s upscale “International-sized” cars got unique front and rear sheet metal, modified dashboards and plusher interior trim. While Seville and Versailles only offered 4-door sedans, the LeBaron and Diplomat augmented the 4-doors with a 2-door coupe body style as well, featuring a unique roofline and differentiated rear-quarters. Wagons would also join the LeBaron/Diplomat lines for 1978.
However, unlike Cadillac and Lincoln, who presented their babies as top-of-the-line offerings, Chrysler positioned the LeBaron/Diplomat simply as upmarket American cars in a trimmer size. At ~$5,500, LeBaron/Diplomat base prices were comparable to the “basic” full-sized Chrysler Newport/Dodge Royal Monaco (not the more premium Chrysler New Yorker Brougham). Differences between the two divisional offerings were minimal—other than the LeBaron’s “upside down” headlamp/parking lamp treatment and busier grille, there was little else to allow buyers to tell one from the other.
So there was a whole lot of smaller scale traditional Americana newly on offer from Detroit for 1977, though not much to directly challenge anything being imported from across the Atlantic. No doubt perfect for Bloomfield Hills, but how about the rest of America?
The Car and Driver test drive took place in Los Angeles, where the Versailles and LeBaron/Diplomat were introduced. The editors could not resist poking fun at the shallowness of some appearance-obsessed Angelinos to highlight the superficial benefits that the new “International-sized” offerings represented: these were pretty ordinary American cars, no different than a Beverly Hills mini-diva with new rhinoplasty and leather accoutrements as compared to her un-retouched, cloth-clad counterpart from Van Nuys.
As for the specs, the cars were surprisingly closely matched in many ways. Cadillac had the clear advantage under-hood, with fuel injection and higher horsepower and torque ratings, though at $15,240 as-tested ($60,358 adjusted) it should have offered the best-of-everything. The Lincoln engine pure was Ford, while the premium Mopars also offered the same power trains as their cheaper compact cousins (and basically matched the Lincoln’s output despite smaller displacement). Price wise, however, the differences would have been huge. Though MSRPs on the new offerings were not available to C&D at the time of the test, based on a period price guide and the equipment shown on the pictured cars, I’d estimate the Versailles would have been $12,008 ($47,558 adjusted), the loaded LeBaron Medallion Coupe would have been $7,518 ($29,775 adjusted) while the more basic Diplomat Medallion Sedan would have been $7,069 ($27,997 adjusted). Badge snobbery and build quality aside, the clear price/value advantage went to Chrysler.
Car and Driver noted that the LeBaron/Diplomat really wasn’t in the luxury league—a fair assessment and in-line with Chrysler’s positioning. The cheaper “small luxury” approach naturally eclipsed the sales of the expensive Seville and Versailles for 1977: 54,851 LeBarons and 37,552 Diplomats were sold, compared with 45,060 Baby Cadillacs and 15,434 Baby Lincolns. Without a doubt, 152,897 sales of “International-sized” cars were a nice shot in the arm for Detroit. However, in the same price bands (or higher), Audi sold 35,849 cars, BMW sold 28,776 cars, Mercedes-Benz sold 53,818 cars and Volvo sold 46,790 cars. The dimensions of these cars may have all been considered “International” but the buyer motivations were vastly different. As C&D noted, none of the Detroit offerings came close to European standards of performance and practicality.
For Cadillac and Lincoln, that fact proved to be especially problematic. While the first generation Seville sold well (215,659 units over 5 model years), the Versailles barely made a ripple (50,156 units over 4 model years). Conceivably, if Detroit had been paying attention to buyer preferences among trend-setting, highly educated and affluent luxury buyers, the second generation Seville and Versailles would have been much more sophisticated offerings with a tasteful, uniquely American take on international standards of excellence.
Instead, both Cadillac and Lincoln decided to target Liberace. Unfortunately for GM and FoMoCo, however, baroque bustle-backs were the exact opposite of where the “International-sized” luxury market was heading as the 1980s unfolded.
The 1980 Seville saw sales drop by 26% to 39,344 compared to the tamer-looking 1979 model. Ironically, despite the throwback design, the chassis of the new Seville was pretty sophisticated by the standards of the day, with a fully independent rear-suspension. But with subpar engine choices and overwrought styling, the Seville simply could not appeal to buyers seeking refinement, high material quality and superior engineering. While domestic brand sales were down substantially in the recession-wracked 1980 model year, combined sales of Audi, BMW, Mercedes-Benz and Volvo rose 2%. The shift in taste was clearly underway.
By 1982 when the baroque Lincoln Continental arrived, the bustle-back style was even more stale (Chrysler’s Imperial had also introduced a variant of that look in 2-door form for 1981). Once again, the “Baby” Lincoln was based on the Ford Granada, this time using the Fairmont-derived Fox platform, hardly an example of cutting-edge engineering. The market responded with a shrug, and ’82 Continental sales amounted to 23,908 units (beating Seville’s ’82 total of 19,998). By contrast, that pesky premium quartet from Europe (Audi, BMW, Mercedes-Benz, Volvo) sold a combined total of 236,685 cars in the U.S. for 1982. The market had spoken: for efficient, smaller luxury cars, the Europeans were the ones to beat.
Interestingly, Chrysler had success doubling down on the over-styled, old-school “American luxury” strategy by continuing to offer LeBaron-based product as a smaller alternative to traditional big cars. For 1982, in a classic Lee Iacocca flourish, Chrysler took the old LeBaron 4-door sedan, made a padded vinyl “formal” landau vinyl top and pillow-tufted seats standard, along with a name change to New Yorker. Suddenly the “International-sized” Chrysler of the late 1970s was the new “full-sized” Chrysler of the 1980s (the true full-sized Chrysler R-bodies were dropped after 1981). The move was magic: sales rose 17% for the “new” New Yorker compared to the 1981 LeBaron. In 1983, the New Yorker 5th Avenue (later simply called 5th Avenue) became the best selling Chrysler brand product, all the way through 1986. For a few years in the mid-1980s, the 5th Avenue was selling over 100,000 units per year. These sales were pure gold, and undoubtedly contributed mightily to Chrysler’s bottom line. The M-Body was fully amortized, and the glitzy trim cost next to nothing, yet the New Yorker/5th Avenue sold for ~50% more than the price of the mechanically identical Dodge Diplomat ($18,345 versus $11,995 in 1989, or $35,507 versus $23,217 adjusted). Lido was laughing all the way to the bank in Bloomfield Hills.
By 1989 when the M-Body was finally retired, Chrysler had cranked out 1,011,323 LeBaron/New Yorker/5th Avenue units and 411,543 Dodge Diplomats (mostly fleet sales after 1980). During that same 1977 to 1989 period, the “Baby” Cadillac and Lincoln had each served up 3 different platforms, switched from rear-wheel-drive to front-wheel-drive, and presented wild swings in styling direction. As for sales from 1977 to 1989, Cadillac moved 437,240 Sevilles (mostly 1st generation) while Lincoln sold 285,287 Versailles/Continentals (mostly 3rd generation). Before anyone argues that the high Cadillac and Lincoln price tags accounted for lower sales, keep in mind that Mercedes-Benz sold 928,204 units in America from ’77 to ’89 mostly at prices vastly higher than Seville and Versailles/Continental models. Luxury buyers seeking “International-sized” products were definitely willing to spend money for the right product, replete with understated styling and sophisticated engineering.
So with hindsight, who really hit the target? For many high-end buyers seeking efficiency with snob appeal, the premium imports were still the best choice. For Americans seeking old-school big car glitz in a smaller size at relatively affordable prices, the Chrysler division nailed it with the LeBaron (and later New Yorker/5th Avenue). Sophisticated luxury cars they weren’t, but then again Seville and Versailles were hardly paragons of cutting-edge product excellence. Cadillac and Lincoln priced too high and aimed too low from an engineering, design and material standpoint, thus sealing their fate as second-tier luxury brands by the close of the 20th Century. The new tastes in luxury among affluent target buyers was becoming clear by 1977, but Detroit wasn’t prepared to listen. After all, things were quite comfortable in Bloomfield Hills.