The last time Chrysler Corp. faced bankruptcy was in 1979, when a maverick, 55-year-old Lee Iacocca, only one year into his tenure as the company's CEO, convinced the government to bail out the company and provide $1.5 billion in federally backed loans. He succeeded in reviving Chrysler, starting with the compact to mid-sized K-car line in 1981. Two years later, he followed that successful launch with an even more dramatic breakthrough, the first minivans, the Dodge Caravan and Plymouth Voyager, which drew hordes of families to showrooms and set the standard for family-friendly transportation. Thanks in part to the success of the vehicles he introduced and cost-saving measures he implemented, Iacocca was able to turn the company around during the 1980s, paying back the government loans seven years early. He retired from Chrysler in 1992.
But on Thursday, as President Obama announced the plan for Chrysler to file Chapter 11 bankruptcy, there is no white knight like Iacocca to save the company. Relying heavily on big vehicles, like minivans and sport-utility vehicles, and largely ignoring the fuel-efficient car market eventually became the source of the company's undoing. That was especially true last summer as gas prices began to skyrocket and fuel efficiency became a priority. Since his retirement, Iacocca has focused much attention on The Iacocca Foundation, which he founded in 1984, a year after his wife, Mary, died from complications of type I diabetes. The foundation has raised more than $23 million in research dedicated to finding a cure for the disease.
In the midst of his retirement, Iacocca took time to reflect on the demise of the company he once led and rescued and issued the following statement:
"This is a sad day for me. It pains me to see my old company, which has meant so much to America, on the ropes. But Chrysler has been in trouble before, and we got through it, and I believe they can do it again. If they're smart, they'll bring together a consortium of workers, plant managers and dealers to come up with real solutions. These are the folks on the front lines, and they're the key to survival. Let's face it, if your car breaks down, you're not going to take it to the White House to get fixed. But, if your company breaks down, you've got to go to the experts on the ground, not the bureaucrats. Every day I talk to dealers and managers, who are passionate and full of ideas. No one wants Chrysler to survive more than they do. So I'd say to the Obama administration, don't leave them out. Put their passion and ideas to work."