While there is a popular misconception in some sectors of the auto industry that you can become profitable simply by cutting your operating costs to the bone, the truth is that a car company lives or dies by the strength of its products. That was the hard truth that Chrysler faced in 1981, as it trepidatiously introduced the models that would determine its fate: the K-cars and the 1981 Imperial.
NEW BLOOD AT CHRYSLER
When we last left Chrysler, it was 1981 and the company had just launched the products that would determine its fate. Federally guaranteed loans, brutal cost-cutting, and a host of concessions from workers, suppliers, and creditors had kept Chrysler’s doors open, but none of those things would matter if Chrysler had no competitive vehicles to sell.
Chrysler’s truly gargantuan cars had died after 1978. What remained in 1980 was an array of downsized rear-drive cars — the intermediate M-body sedans (Chrysler LeBaron/Dodge Diplomat), the J-body coupes (Chrysler Cordoba/Dodge Mirada), and the big R-body sedans (Chrysler Newport/Dodge St. Regis/Plymouth Gran Fury) — along with the front-wheel-drive L-bodies (Dodge Omni/Plymouth Horizon) and a number of Mitsubishi products. The R-bodies were on their way out and would be gone after 1981. The M-body cars lingered through 1989, mostly for police and taxi use.
Chrysler’s most important new products for 1981 were the compact K-cars, the Dodge Aries and Plymouth Reliant. The two versions were nearly identical save for grilles, badging, and trim; Chrysler no longer had the money to differentiate the brands more than that. Twenty years earlier, Lee Iacocca had lambasted Robert McNamara’s boxy, compact Ford Falcon, convincing Henry Ford II to write off the $35 million development cost of the even smaller, front-wheel-drive Ford Cardinal. Now, he was betting heavily on a car not much bigger than the Cardinal and even boxier than the Falcon.
The Reliant and Aries were extremely conservative cars in every way: square-rigged and upright, long on space efficiency, short on sex appeal. Their engineering was reasonably contemporary, with front-wheel drive, unitary construction, and Chrysler’s first modern four-cylinder engine (a bigger Mitsubishi four was optional). The Ks lacked some of the features of import rivals like the Honda Accord, such as a five-speed manual gearbox or an independent rear suspension; in compensation, the Chrysler products were substantially cheaper. The K-cars were slow but frugal, with reasonable passenger and cargo room and admirable fuel economy. The Reliant and Aries were not great cars, but as no-frills basic transportation, they were decent value.
Contrary to popular belief, the K-cars were hardly a runaway sales success and they got off to a slow start. Part of the problem was a mismatch between Chrysler’s low-price-centric advertising and the heavily optioned and thus rather expensive early production cars, but that issue was quickly solved. A bigger issue was buyers’ understandable concern about Chrysler’s viability as a company, still an open question in 1981. Buying a new car from an automaker that may not be long for the world is seldom a good investment, so Chrysler was once again forced to resort to generous rebates on cars that were now more modestly equipped and thus cheaper to begin with. The result was that a Reliant or Aries was not substantially costlier than the smaller Dodge Omni or Plymouth Horizon and a fair number of the 306,000-odd combined Reliant/Aries sales for 1981 probably came at the existing model. Ordinarily, getting buyers to trade up from a smaller car to a larger one is a good thing so far as profits are concerned, but not when it involves cutting the larger car’s price almost to the level of the small one.
THE 1981 IMPERIAL
If the K-cars were all about unpretentious value, Chrysler’s other new release, the newly revived 1981 Imperial, was something else entirely. For a company so close to financial collapse that its chairman had sought federal relief and substantial sacrifices from its workers, releasing an overstuffed, overpriced prestige car took serious chutzpah. Iacocca was uncharacteristically apologetic about the Imperial, firmly asserting that it hadn’t been his idea.
It’s true that the Imperial was conceived before Iacocca’s arrival at Chrysler and approved by his predecessor, John J. Riccardo, but to our eyes, it seems very much Iacocca’s sort of car. Like Lincoln’s popular Continental Mark series, which Iacocca had launched back in 1968, the Imperial was a big, two-door personal coupe with a long nose, a short deck, and an upright formal grille. Like the Mark, the new car also carried a truly imperial price tag; at $18,311 ($1,000 more with the optional moonroof), it cost as much as three K-cars.
The Imperial nameplate had been introduced back in 1924 as Chrysler’s top-of-the-line model. In 1955, the corporation had made Imperial a separate division, hoping to better establish it as a prestige make akin to Lincoln or Cadillac. Its sales had never been very strong and Chrysler had pulled the plug in 1975. Still, the cash-strapped Chrysler management of the late seventies had salivated at the profits generated by the rival Cadillac Eldorado and Lincoln Continental Mark series. With the bargain-basement pricing of the Omni/Horizon and the K-cars, the prospect of a profitable new flagship was particularly enticing; much of the 1981 Imperial’s daunting sticker price was a fat profit margin.
CORDOBA IN DRAG
The 1981 Imperial, which was substantially smaller than its Brobdingnagian predecessor, was based closely on the J-body Chrysler Cordoba. The Cordoba had been launched back in 1975 as Chrysler’s first real entrée into the popular personal-luxury market; the Cordoba remembered today mostly for its well-remembered TV commercials featuring actor Ricardo Montalban. The Cordoba was downsized for 1980, becoming a derivative of the M-body sedans and the Plymouth Volare/Dodge Aspen.
The Imperial was distinguished from lesser M-bodies by unique heavier-gauge sheet metal, but its dimensions were nearly identical to those of the Cordoba, as were its suspension, brakes, and running gear. The pricier car’s main point of mechanical distinction was fuel injection for its standard V8, Chrysler’s first attempt at electronic fuel injection since the ill-fated Bendix Electrojector of 1958.
The Imperial’s stand-up grille and razor-edged front fenders, which suggested a self-consciously futuristic update of the 1969 Continental Mark III, were likely borrowed from the LeBaron-based 1977 Chrysler Turbine concept car, designed by Bob Marcks, then a Chrysler stylist. Based on surviving photos of the preproduction clays, those elements were chosen over a more curvaceous proposal that showed the strong influence of the Cord 812 by way of the original Oldsmobile Toronado.
The bustleback tail, not present on Marck’s Turbine Car design, was apparently the work of Chrysler designer Steven Bollinger, who did the initial design studies for the Imperial in early 1977. The bustleback, presumably inspired by Hooper-bodied Rolls-Royces, bore a startling resemblance to the rear deck treatment of the 1980–1985 Cadillac Seville, although as far as we’ve so far been able to determine, the resemblance was coincidental. (The Seville’s bustleback dated back at least as far as 1967, having originally appeared on Wayne Kady’s proposal for the 1971 Eldorado, but unless Bollinger — who was at Ford at that time — somehow saw Kady’s design and was inspired by it, we assume that both can be traced back to Hooper rather than one to the other.)
We would call the resulting design more cohesive than the Seville, which was almost bland from the front before taking a turn for the outré further aft. Even so, the Imperial remained a confrontational design, perhaps better suited to the tastes of the mid-seventies, when it was conceived, than the rapidly changing aesthetic of the early eighties. The effect was at least striking, if not particularly tasteful.
Inside, the Imperial was pure science fiction, featuring Chrysler’s first digital instrument panel. Perhaps inspired by the Lagonda, this self-consciously futuristic device had enough buttons and electronic displays to make an F-14 radar intercept officer feel right at home; 1981 Imperial advertising modestly proclaimed the dash “an electronic marvel.” Lest anyone find the high-tech trappings too antiseptic, the interior was dressed up with color-keyed Mark Cross leather upholstery and carpet so plush it resembled fake fur. As a crowning touch, a gaudy Cartier crystal medallion was set into the steering wheel boss.
OL’ BLUE EYES: THE IMPERIAL FS
Iacocca confidently predicted that Chrysler could sell 25,000 Imperials a year, the maximum output of the Windsor, Ontario production line. He also enlisted his old friend Frank Sinatra to sing a jingle for the car, “It’s Time for Imperial,” a favor Sinatra reportedly performed for a token fee of $1 plus an early-production car. Ol’ Blue Eyes also lent his name to the limited-edition “FS” package, which featured special “Glacier Blue” paint with matching interior trim and a complete set of Sinatra’s greatest hits on audio cassette, packed in a special Mark Cross leather case.
The 1981 Imperial was received gloomily by the automotive press, which saw it as the wrong car at the wrong time. In an era of downsizing, the Imperial was unfashionably bulky; its heavy-duty body structure and everything-but-the-kitchen-sink standard equipment had swelled its curb weight to an even two tons. Even with the fuel-injected V8, the Imperial’s weight and ultra-tall gearing made acceleration a leisurely affair: With a 0-60 mph (0-97 km/h) time of around 13 seconds, Chrysler’s flagship could potentially be outrun by a manually shifted Plymouth Reliant and passing times were similarly sluggish.
The Imperial’s suspension and tires were calibrated for a pillow-soft ride, but the car lost its composure over sharp bumps or broken pavement. Stopping power was also poor, reflecting the fact that the brakes hadn’t been changed from the much-lighter Cordoba.
Unfortunately, given the state of the economy — not to mention that of Chrysler itself — the sales projections bordered on delusional. Even in its best year, sales of the earlier Imperial had never topped 25,000 and there was no evidence that buyers were clamoring for its return. Moreover, even better-established rivals were not doing well in that moment: Cadillac sales were down more than 40% and the downsized Lincoln Mark VI had just fallen almost 50%. Imperial production for 1981 tallied only 8,113 units, including Canadian sales.
Chrysler blundered further by hiking the 1982 Imperial’s price by a whopping $2,677. The price increase depressed whatever demand there may have been and sales plummeted to a meager 2,717. Before long, the company was offering rebates of up to $2,000. Recognizing the error, Chrysler slashed the base price of the 1983 Imperial to $18,688. Only 1,555 more cars were sold before Chrysler finally pulled the plug. (Sinatra fans may be dismayed to learn that a mere 516 of the 12,385 Imperials built had the FS package. The author has only seen one of these cars in the wild, although we were unfortunately unable to get pictures of it.)
A LONG WINTER
Despite the new K-cars and the Imperial, Chrysler’s sales figures for 1981 were depressing: better than 1980, but still barely half those of 1977, which had been far from Chrysler’s best year. It was little surprise, then, that Chrysler’s losses for 1981 totaled $475.6 million. 1982 sales were even worse, although cost-cutting had lowered the corporation’s break-even point by more than 50% and held operating losses to $69 million.
The 1981-1983 Imperial proved to be a dead end. It was canceled after 1983 along with the slow-selling J-body coupes on which it was based (neither the Cordoba nor the related Dodge Mirada had sold well either). The Reliant and Aries survived with minimal changes through 1989, but they managed to sell at least 200,000 units a year through 1988 — respectable, if not outstanding.
The real significance of the K-cars was the host of derivatives they spawned. The humble K-car platform’s many adaptations included:
- The mid-size Chrysler E-class (LeBaron) and Dodge 400/600, which included the first American convertibles since 1976
- The “Euro-style” H-body five-door hatchbacks (Chrysler LeBaron GTS and Dodge Lancer)
- The sporty G-body Dodge Daytona and Chrysler Laser coupes
- The bizarre Chrysler Executive Sedan and Limousine
- The compact P-body Plymouth Sundance and Dodge Shadow (and their respective sporty derivatives), originally intended to replace the Omni/Horizon
- The E-body Dodge Spirit, Plymouth Acclaim, and Chrysler LeBaron
- The “near-luxury” AC-body Dodge Dynasty and Chrysler New Yorker
- The luxury-oriented Y-body Chrysler Fifth Avenue and Imperial
- The pricey Italian-American Chrysler TC by Maserati.
By far the most important K-car spin-offs, though, were the T-115 minivans (Dodge Caravan, Plymouth Voyager, and Chrysler Town & Country), which were introduced in January 1984 and proved to be far more important than the K-cars themselves in restoring Chrysler to financial health.
Together, the K-cars and the ill-fated 1981 Imperial make an interesting point about the importance of forward-looking product development. When the K-cars were developed in the seventies, they were extremely controversial within Chrysler. Their front-wheel-drive platform was expensive to develop, cost around $700 million, and Chrysler management favored a more conservative, rear-drive alternative, the H-body, which would have been about $300 million cheaper. (It likely would have been similar to Ford’s Fox platform, which spawned the Fairmont and Mustang III.) The H-body would have been the safe choice, but in retrospect, the K-car platform proved to be the best investment Chrysler ever made. By contrast, the Imperial must have seemed like low-hanging fruit, an easy way to milk some additional profits out of an existing platform, but it was a resounding dud.
In part one of our article on the Chrysler bailout, we mentioned that, contrary to popular belief, it was John Riccardo who approved the K-cars, not Iacocca. Had the choice actually fallen to Iacocca, he might well have made the same decision — he and Hal Sperlich had fought and lost a very similar battle at Ford over a K-car-like proposal called the Tiger platform — but by the mid-eighties, Iacocca was as resistant to new platforms as the management of the Riccardo era had been. Spinning off new variations on the K-car architecture was far cheaper than creating wholly new platforms, and some of the spin-offs were certainly clever, but Chrysler’s lineup was increasingly characterized by an overwhelming sense of déjà vu. That sameness would eventually cost Chrysler dearly, as we will see next week.
NOTES ON SOURCES
Sources for this article included the Auto Editors of Consumer Guide, Cars That Never Were: The Prototypes (Skokie, IL: Publications International, 1981), and Encyclopedia of American Cars: Over 65 Years of Automotive History (Lincolnwood, IL: Publications International, 1996); Frank Billington (with corrections and updates from Bill Watson et al), “Dodge Diplomat, Plymouth Gran Fury, Chrysler New Yorker, Fifth Avenue, Town & Country, and Caravelle,” Allpar.com, n.d., www.allpar. com, accessed 24 November 2008; Rich Ceppos, “Chrysler LeBaron Turbo: The hamburger principle revisited,” Car and Driver May 1987; David E. Davis, Jr., “Chrysler Imperial: Return with us now to those thrilling days of yesteryear, Car and Driver January 1981; Jim Dunne and Ed Jacobs, “Three classy coupes,” Popular Science April 1981; James M. Flammang and the Auto Editors of Consumer Guide, Chrysler Chronicle: An Illustrated History of Chrysler – DeSoto – Dodge – Eagle – Imperial – Jeep – Plymouth (Lincolnwood, IL: Publications International Ltd., 1998); Patrick R. Foster, “Personality Profile: Bob Marcks: A Life in Design,” Collectible Automobile Vol. 24, No. 5 (February 2008), pp. 66-75; Jeff Godshall and Bob Marcks, “1977 Chrysler LeBaron Turbine,” Imperial Club, 3 March 2004, www.imperialclub. com/Yr/1981/Turbine/, accessed 23 November 2008; Aaron Gold, “K-Cars: Plymouth Reliant, Dodge Aries, and Chrysler LeBaron,” Allpar.com, n.d., www.allpar. com, accessed 24 November 2008; David Halberstam, The Reckoning (New York: William Morrow and Company, 1986); Lee Iacocca, Iacocca: An Autobiography (New York: Bantam Books, 1984); Mike Kuepper, “Driving Impression: Chrysler Imperial: It may be expensive, but it sure is big,” Car and Driver November 1980; Steve Magnante, “History of Automotive Design 1969-1988: Steven N. Bolinger, Chrysler Design Specialist,” Hemmings Classic Car December 2006; Curtis Redgap, “Chrysler Corporation R Bodies: 1979-1981 Downsized Full-Sized Cars: Newport, New Yorker, St. Regis, Gran Fury,” Allpar.com, 2008, www.allpar. com, accessed 25 November 2008; Gary Smith, “Bob Marcks, Designer at Studebaker, Ford, and Chrysler,” Dean’s Garage, 22 June 2009, deansgarage. com/ 2009/ bob-marcks-designer-at-studebaker-ford-and-chrysler/, accessed 11 November 2009; Jim Smith, “It’s Time for Imperial 1981-1983,” WPC News July 1983; Gary Witzenburg, “1980 Cadillac Seville: Unforgettable or Unforgivable?” Collectible Automobile December 2009; and Brock Yates, “Detroit’s Shattered Love Affair,” Car and Driver October 1974. We also made extensive use of the Imperial Club website’s “(Chrysler) Imperials by Year” pages (www.imperialclub. com, accessed 25 November 2008), which provided production figures, manufacturer specifications, and even details of the Frank Sinatra package.