After a 32-year career with Ford Motor Company, including eight years as president, Lido (Lee) Anthony Iacocca (born 1924) engineered one of business history's greatest comebacks at Chrysler Corporation. His success, coupled with appearances in television commercials and his best-selling book, made him one of the nation's best-known and most admired businessmen.
Lido (Lee) Anthony Iacocca was born October 15, 1924 in Allentown, Pennsylvania, the son of Italian immigrants Nicola and Antionette. Iacocca grew up in comfortable surroundings learning the nuts and bolts of business from his father. Nicola was an entrepreneur who taught his son about the responsibilities of borrowing money and the need for a hard-driving vision in order to build a thriving business. Nicola Iacocca worked as a cobbler, hot-dog restaurant and theater owner. He also ran one of the first car rental agencies in the country and passed on his love of the automobile to his son. Iaccoca was deferred during World War II because of having had rheumatic fever as a child. He earned his BS and MS degrees in engineering from Lehigh University and Princeton University, respectively. Even as a teenager, Iacocca decided that he was going to be an auto company executive and focused his studies in that direction. His degrees are in industrial engineering. He secured a coveted engineering trainee job at Ford in 1946, but deferred his start until he completed his masters degree at Princeton.
Joining Ford Motor Company as an engineering trainee in 1946, Iacocca soon entered the fast lane of sales. With the force of a muscle car and the maneuverability of a racing vehicle, in 1960, at age 36, he sped into the vice-presidency and general managership of the company's most important unit, Ford Division. In 1964, with others on his staff, he launched the Mustang, which, thanks to brilliant styling and marketing, introduced a new wave of sports cars, set a first-year sales record for any model, gave its name to a generation, and landed its creator's picture on the covers of TIME and Newsweek simultaneously.
In 1960 Iacocca was named Ford's vice-president, car and truck group; in 1967, executive vice-president; and in 1970, president. Pocketing an annual salary and bonus of $977,000, the flamboyant executive also earned a reputation as one of the greatest salesmen in U.S. history. Of Iacocca, it has been said that he was always selling, whether products, ideas—or himself.
Iacocca was discharged from Ford Motor Company in June 1978 by Chairman Henry Ford II for reasons Ford never disclosed, but obviously relating to the chairman's distaste for having Iacocca succeed him. Though bitter at being dismissed from Ford, Iacocca was not out of the car business for long. Five months after his firing, Iacocca was named president of Chrysler (becoming chairman in 1979) and began transforming the number three automaker from corporate history's number one deficits manufacturer into a highly-profitable enterprise.
How was Chrysler turned around? By downsizing expenses to a much lower break-even point, by winning approval of $1.5 billion in federal loan guarantees, by selling off profitable units such as the tank division, and by introducing timely products. In addition, Chrysler welcomed, for the first time in U.S. corporate history, a union president to a board of directors. In 1984 the company posted profits of $2.4 billion (higher than in the previous 60 years combined), and in 1985 it bought Gulfstream Aerospace Corporation for $637 million and E. F. Hutton Credit Corporation for $125 million.
In the early 1980's Chrysler issued the K-car and what would later become its meal ticket—the minivan. Just as the Mustang re-established the sports car for Ford, the minivan would be loved by the young family in need of room and efficiency and revitalize Chrysler. In 1983, Chrysler paid the government back its loans and Iacocca became a star, a symbol of success and the achievement of the American Dream.
Along with spearheading Chrysler's resurgence, Iacocca assumed various civic responsibilities, most notably the chairmanship of the President's Statue of Liberty-Ellis Island Centennial Commission, set up to raise funds for and to oversee restoration of the two monuments. If Iacocca attained prominence through business stewardship, television commercials, and identification with the Statue of Liberty, he gained much additional exposure through his 1984 autobiography. Iacocca: An Autobiography, the best-selling nonfiction hard cover book in history, had two million copies in print by July 1985. Most readers seemed to accept the volume as near-gospel, while others ventured that Iacocca's achievements had lost nothing in the telling and that the author was overly vindictive toward Henry Ford II.
By the mid-1980s Iacocca had achieved folk-hero status. Typically, the Saturday Evening Post described him as "the sex symbol of America" the Reader's Digest as "the living embodiment of the American dream" and TIME as "a corporate capitalist with populist appeal, an 'eminence terrible' admired by working class and ruling class alike." Talk of Iacocca-for-President became increasingly widespread, and a 1985 poll of 1988 presidential preferences showed that the cocky industrialist trailed Vice-President George Bush by only three percentage points (41 to 38 points).
The late 1980s and early nineties were not as kind to Iacocca. His public image, like Chrysler's earnings, began to fall off. At a time when the American people, in the grip of a recession, renounced the huge paychecks of executives whose companies were ailing, Iacocca who had once achieved a publicity coup when, for a time, he only accepted one dollar a year from Chrysler, was paid a 1987 salary of $18 million. In addition, Iacocca, lambasted Japanese trading practices, blaming them for the ills that American car manufacturers had suffered. Critics cited that the American public believed that Japanese cars were superior and instead of criticizing the Japanese, Iacocca's car company should have been emulating them. At the end of 1992, Iacocca was forced to retire after he had bettered the position of the company for a merger or takeover. He remained a consultant to Chrysler (with a $500,000 a year salary and use of the company jet) until the end of 1994.
In 1995, Iacocca announced that he was suing Chrysler, claiming that it unlawfully blocked him from exercising $42 million in share options that he had earned while he was the chairman. Chrysler claimed that Iacocca's role as an adviser to Kirk Kerkorian, the investor who wanted to purchase the company, violated the share option plan agreement. Although Kerkorian's bid failed to materialize because he was unable to raise the financing, Chrysler agreed to pay Iaccoca $21 million to settle the lawsuit. Iacocca continued to work as Kerkorian's consultant.
Iacocca and Mary McCleary were married in 1956 and had two daughters, Kathi and Lia. Mary died of diabetes in 1983, and in her memory, Iacocca donated his book earnings to diabetes research. In 1986 Iacocca married Peggy Johnson (born 1950), an advertising executive from whom he was divorced in 1996.
The primary source of information about Iacocca is the executive's best-selling Iacocca: An Autobiography (1984), although critics say it was written mostly to stroke Iacocca's ego and to vilify Henry Ford II. David Abodaher's Iacocca (1982), written by an employee of Chrysler's advertising agency, ceaselessly praises the automaker while providing interesting anecdotal material. Perhaps the best of the numerous magazine and newspaper stories on the magnate are New Republic's "What's So Great About Lee Iacocca?," July 16 and 23, 1984; Newsweek's "Behind the Wheels," October 8, 1984; the New York Times's "The Importance of Being Iacocca," December 23, 1984; and Time's "A Spunky Tycoon Turned Superstar," April 1, 1985. Detroit News, "Retirement has been a rough ride for Iacocca," June 1996; Automotive News, June 1996.