It will not have escaped even the casual observer that the companies formerly known as the Big Three automakers — GM, Ford, and Chrysler — are in bad, bad shape. GM lost $37 billion in 2007. Ford’s operating losses were $2.7 billion overall, but they lost $5 billion on their automotive operations. Chrysler, which is now owned by Cerberus Capital Management, is not obliged to share their annual results (not being publicly held), but they aren’t doing a lot better. As of this writing, the three companies are asking for at least $34 billion in federally guaranteed loans, a new bailout. In this last installment of our series, we weigh in on the state of Detroit.
In 1981, Chrysler had $1.2 billion in federally backed loans and an array of new products. Problem solved? Not exactly. In the third installment of our series on the Chrysler bailout, we examine the corporation’s rocky road back to solvency — and how it ended up on the ropes again less than a decade later.
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.
Throughout its 85-year history, the Chrysler Corporation has often found itself engaged in a coquettish flirtation with doom. Although Chrysler sometimes led the American industry in engineering innovation, a combination of ill-considered product choices, quality problems, and misguided management have put it on the ropes more than a few times. The list of disasters is long: the brilliant but commercially moribund Airflow of the 1930s; the catastrophic quality-control issues of the late 1950s; the ill-fated “downsizing” of 1962. The one on everyone’s mind of late, however, is the late-seventies financial crisis that sent ostensible free-market conservative Lee Iacocca to Washington, hat in hand — looking for a bailout.
In Hunter S. Thompson’s 1971 novel Fear and Loathing in Las Vegas, the narrator, Raoul Duke, and his attorney, Doctor Gonzo, set out from Los Angeles to Las Vegas in a rented red convertible they dub the Great Red Shark, blazing across the desert, hopped up on enough controlled substances to fill a shopping cart, in search of the American Dream. The novel’s Great Red Shark was a Chevrolet, not a Dodge, but there would be few better choices for a fast run from L.A. to Las Vegas than this week’s subject: the rare and rocket-like 1960 Dodge Polara D-500.
Continue Reading Great Red Shark: The 1960 Dodge Polara D-500
Performance car enthusiasts tend to be a somewhat humorless bunch, whether you’re talking about Ferraristes, old-school muscle car fans, or import tuners. If they have one thing in common, it’s that they’re none too keen at being laughed at. That’s why it’s remarkable that one of the premier icons of the muscle car era is one of the most irreverent of them all: a budget Supercar named after a cartoon bird — the Plymouth Road Runner. This is its story.
When we last saw the Plymouth Barracuda, its second generation had floundered (if you’ll excuse the expression) in its efforts to challenge the popular Ford Mustang, ranking near the bottom of the “pony car” sales race despite more attractive styling and stronger engines. Troubled but undaunted, Plymouth took a third swing, with results that surprised even them. Here’s the story of Plymouth’s 1970-1974 E-body Barracuda and Plymouth Duster.
If you ask the average person to name an American sporty car of the late sixties, you probably won’t hear “Plymouth Barracuda” unless the person is a dedicated Mopar fan. In a way, that’s curious, because the Barracuda was the first of the so-called pony cars to hit the market (even before the Ford Mustang) and in some areas it was arguably superior to its Ford rival. So, why was the Barracuda doomed to be a perennial also-ran? This is the sad story of the 1964-1969 Plymouth Barracuda.
Continue Reading Fish Story: The Plymouth Barracuda (Part One)
Successful car design is as much a matter of prognostication as engineering skill or styling acumen. To be successful, a design has to take into account not only where the market is now, but where it’s going to be three years from now. If you show up late to the dance, it may not matter how stylishly you’re dressed or how clever your moves may be. Dodge learned that the hard way in the early 1970s when it made its belated entry into the “pony car” market: the formidable but ill-fated 1970–1974 Dodge Challenger.
Continue Reading Mean Machine: The 1970-1974 Dodge Challenger
Thanks to The Dukes of Hazzard, most Americans are familiar with the sleek, late-sixties Dodge Charger, but the General Lee was actually the second generation of Dodge’s sporty car; the first was the original Coronet-based fastback Charger, a peculiar-looking car born of desperation and bitter sibling rivalry. This is the story of the 1966-1967 Dodge Charger.