By on April 30, 2009

Chrysler’s logo should have been a bottle of lithium, rather than the Pentastar. It suffered from severe bipolar disorder all its life, and, sadly, died from it at its own hands. Like many suicidal bipolars (e.g., Van Gogh, Hemingway, Virgina Woolf), Chrysler’s many crashes and acts of self-mutilation were punctuated by fantastic highs of brilliant engineering, design and creativity. Chrysler has taken us on quite the roller coaster ride. And now it’s over. As we stumble out of our (Hemi-powered) coaster car, we’re left with an intense mixture of relief, thrill, and sadness.

Chrysler’s beginning was an unparalleled flash of genius and overnight success. Walter P. Chrysler had a fairy-tale career in the early automobile business, earning $10 million ($130 million today) in just three years while turning Buick into GM’s early powerhouse. Then, while running Maxwell, he launched the Chrysler line in 1924 with that just-perfect blend of advanced engineering and style.

It was a home run that catapulted Chrysler to number four out of a crowded field of 49 manufacturers. The subsequent successful launches of the low-price Plymouth, the upper-mid priced DeSoto, and the purchase of mid-priced Dodge firmly established Chrysler as a charter member of the Big Three.

Chrysler’s first crisis came in 1934 with the failure of the radically advanced but unusual-looking Airflow. Its wholesale rejection by the buying public taught Chrysler (and Detroit) a painful lesson: avoid extreme innovation.

Chrysler recuperated and made enormous profits during the WWII era. But the development of the all-new 1949 models was haunted by Chrysler’s still-lingering Airflow insecurities. Whereas GM and Ford confidently introduced longer and lower models designed to thrill exuberant post-was buyers, Chrysler president P. T. Keller insisted on tall, boxy cars.

In the early fifties, Americans were in the mood for more—horsepower, automatics, power steering and brakes, style, and flash. Unlike Chevy and Ford, Plymouth offered none of those, and the market punished it unmercifully. In 1954, Plymouth was kicked out of its long-established number three spot by Buick and dropped to number five behind Pontiac.

The exuberant designer Virgil Exner was hired to inject vitality and fresh style. The 1955s were an improvement, but the radical 1957s were destined to be the great leap forward (“suddenly it’s 1960!”). But in the rush to revolutionize, the products were not fully developed, and suffered from atrocious build quality.

The flashy ’57s sold, but word got out and buyers punished Chrysler unmercifully. 1958 sales plunged by no less than 41% for Plymouth. And despite a reputation for engineering excellence, Chrysler would have to dodge a reputation for spotty build quality from then on, deserved or not.

Chrysler nursed itself to health once more, only to be deeply wounded by one of the most staggeringly idiotic acts of executive self-mutilation. In 1960, Chrysler president William Newberg overheard a rumor at a cocktail party that Chevrolet was working on a dramatically smaller 1962 model (it was: the compact Chevy II).

In a colossal blunder, he assumed this referred to the full-sized Chevrolets. Newberg killed development of the full size 1962 Plymouths and Dodges and initiated a crash program for substantially downsized replacements. When the ugly, truncated ’62s were first shown to dealers, an uproar ensued, and twenty dealers cancelled their franchises on the spot. Plymouth crashed to ninth place, while GM’s market share rose to an all-time peak of 52%.

Chrysler barely survived the fiasco but went on to enjoy a relatively long spell of good health from the mid-60s through 1974, in part thanks to its successful performance image. But with a portfolio of heavy RWD cars and lacking the foresight, will (and capital) to retool extensively, Chrysler was flattened by the one-two punch of the energy crises. By 1979, it was back on the critical list, saved from bankruptcy only by the life-support of a government loan-guarantee act.

This financed the compact K-car; Chrysler squeaked by and regained health, once again. Endless K-car variants carried the day. When the 1990 recession brought on another depression, Iaccoca was shown the door.

In the mid-nineties, Chrysler was on its ultimate manic high. Low overhead costs from its near-bankruptcy, some deft model development, the purchase of Jeep, and sheer luck (the boom of the truck and SUV markets) generated huge profits and a 23% market share in 1997 (bigger than GM’s recently). But at the very height of health and success, the suicidal urges return.

In 1998, CEO Robert Eaton had Chrysler engage in ritual corporate seppuku by selling itself to Daimler (while walking away with over $200 million himself). And despite all of Dr. Z’s ministrations, the patient never really regained lasting health. Was there arsenic in the Daimler medicine?

There’s a market for corpses, and Cerberus bit with all three heads at once. And choked.

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30 Comments on “Chrysler Suicide Watch 50: RIP...”


  • avatar
    BuzzDog

    Chrysler’s first crisis came in 1934 with the failure of the radically advanced but unusual-looking Airstream.

    Actually it was the Airflow. The Airstream was a more conventionally-styled automobile, rushed into production to save the corporation from rapidly sinking sales numbers.

  • avatar
    psarhjinian

    But at the very height of health and success, the suicidal urges return.

    This happens when leaders get cocky and start believing their own PR. Carlos Ghosn narrowly avoided this fate at Nissan, and it looks like Wendelin Wiedeking is on the same path

    Chrysler’s leaders, though, made a habit of it.

    The worst part is how people forgot that. For example, a number of people forgot that Iaccoca did exactly noting to stem Chrysler’s terrible quality nor address is sliding marketshare and product planning problems, and have been cheering for his return.

  • avatar

    Chrysler products were ubiquitous in the mid-90s, but I never realized their market share was that high. How the mighty have fallen!

  • avatar
    Flarn

    I saw a Desoto the other day on the Ronald Reagan freeway in California. It was in better shape than the current Chrysler Corporation. The Orphan Car Club of America is doing brisk business.

  • avatar
    Paul Niedermeyer

    @BuzzDog,

    You’re right. Fixed.

  • avatar
    DearS

    I really had good times in Caravans, Vipers are great, and the acclaim got on my nerves. I wanna see some more good products come out of Chrysler, but I’m not looking to hold my breath.

  • avatar
    quasimondo

    Everybody told me, “no, a Chapter 11 filing is the way to save them!” I told people there would be no difference between Chapter 11 and Chapter 7 in the eyes of many.

    And so here we are. The in isn’t even dry on the paperwork and everybody’s parading Chrysler down the street like a funeral procession on a New Orleans street.

  • avatar
    Buckshot

    They´re not dead yet.
    They have just formed an alliance with Fabbrica Italiana di Automobili Torino.
    But what kind of size and market share they will have is up in the air.

  • avatar
    GS650G

    Customers and investors gave up on Chrysler a long time ago.

  • avatar
    carlos.negros

    If we can think about the Chrysler-FIAT alliance in a different way for a moment; not as a way to save auto sales in the U.S., but as a company ready to take on new global markets; then we get a new perspective.

    I don’t see any automaker, including Toyota or Honda, as being able to call the United States their biggest market right now.

    But which companies are best suited to compete for the emerging markets in Central and South America? FIAT already has a strong presence in Brazil. Why should that market be left to Chinese companies?

    Seen in this light, Chrysler may be able to emerge from Bankruptcy stronger and better suited for the future. As for building something for the U.S. market; why should that be the primary concern?

  • avatar
    jurisb

    I am not dead yet. Actually I am fine. Can I go with you? ( from Search for the Holy Grail. Monty Python).
    DearExecutive Board of Fiat, do you actually realize what Chrysler really is? It is a typical american corporation with huge teeth but no brains, a triassic monster with leaf springs, and rusted huge block cast iron atavisms.Fiat, you will get nothing technologically, that would help you to compete in Europe. At the same time Chrysler will pump out your parts and platforms, make copycats of them and then dilute your own sales by selling their rebadges next to your cars. Mercedes was smart enough to run away from Chrysler, because Chrysler was large, primitive, and there were no parts Mercedes could use for themselves, while Chrysler was sucking from Merc everything -starting from Sprinter cargo van and ending with e-class floorpan.No company has ever yelded from an american car manufacturer in long run. There ar no Mazdas with Ford engines, there are no Daewoos with GM engines, there are no Toyotas with Pontiac engines. For God`s sake, Fiat, wake up!!! And even if your stock prices might increase in short run ( because of wallstreet actual idiotism) you will collapse in long run, after you will have to share evry technology with Chrysler, while Chrysler will give you nothing that would be engineered by themselves. Doesn`t history tell you anything? Just for fun, read on the Internet why Hyundai desperetale bought out their own shares when Chrysler had bought them shortly before.

  • avatar
    Cynder70

    I really like that this article points out the colossal failure to improve quality. The engineering, style and driving dynamics were there for the most part. I could never bring myself to buy a Chrysler in the mid-90’s because of the quality–I didn’t want to be another person shelling out money for a cracked head gasket because an accountant wanted to save .23¢ on the manufacturing.

    I never felt this way with Subaru and they never gave me any reason to believe it either.

    @jurisb… correction: Mazda has been using Ford derived (sourced?) V6 engines for several years with the introduction of the 2003 Mazda6. Mazda has also sold rebranded Ford trucks and SUVs since 1990.

  • avatar
    jpcavanaugh

    Ahhh. Chrysler and quality. The pre-Iacocca Chrysler was an engineering company. Their quality was legendary into the first half of the 50s. As brilliant as the 57s were, their build-quality was HORRIBLE. But the long term durability of engines, suspensions, transmissions and all the things that make a car a car was the best in the industry. This was the state of Chrysler for over 20 years. Some of the worst paint jobs I ever saw on new cars was on 70s Mopars. And for the most part, they were never very good at making the cars appealing to the average buyer. These cars appealed to those who saw inner beauty, not outer beauty.

    The Iacocca era changed this. Where the vehicles had never had broad appeal, the New Chrysler put in place a culture that could spot market trends and put out a popular choice. Assembly quality went up dramatically and continued to improve. Even current Chrysler vehicles seem well assembled. The problem is that long-term quality suffered and has never recovered.

  • avatar
    jurisb

    Cynder70-Which exactly ford engine has mazda been using lately? The2.5 liter v6 is a complete Mazda engineered one, and Ford took it not vice versa, Ditto the 2.3 liter engine.The only miserable truck Mazda stupidly took was godforsaken Ranger, which is rotting in pieces because ford probably expected to overhaul it when it gets 50 years old or something. And no SUVs mazda has ever rebadged, Tribute is 100% engineered by Mazda. Actually imagine what would american car companies sales really look like if people really found out whose engineered parts their cars actually have.Do people buy Maverick because they think they are buying an american vehicle and support local economy?

  • avatar
    200k-min

    Which exactly ford engine has mazda been using lately?

    The Mazda 6 that I had for a short while had a Ford 3.0l V6. Not sure about the new model, but in mine it was a variant of the duratech that is in hundreds of thousands of previous gen Ford Tauruses.

    As for Chrysler, their mid 1990’s peak was 100% off the pure luck of the AMC takeover. The Grand Cherokee was already in development and why Iacocca wanted Jeep in the first place. The LH cars were started at Eagle before the takeover. Both were very successful, but neither would I say were the result of genius Chrysler engineering and innovation. My father was in sales for over 40 years, driving a new vehicle about every 2. He saw a lot of vehicles from all Big 3 and said undoubtedly from the 60’s through early 2000’s that Chryslers were always the poorest quality vehicles he ever drove. Hemi engines and flashy new models can only carry a company so far. This death has been a long time coming…and probably should’ve happend in 1979.

    Epilouge, after my Dad finally retired…he bought a Honda.

  • avatar
    NN

    @ jurisb–in addition to the Mazda V-6’s that are Ford (of Europe) developed, Daewoo’s do use old Holden engines. Yes, they are Australian and probably also originally of European descent, but they are not Daewoo.

    Also, Fiat made out pretty well with their last US-association, when GM paid them $2 billion to go away…$2 billion which financed the development of the new Panda & Cinquecento and launched their successful return. If your point, however, is that foreign partnerships with US companies don’t result in the foreigners gaining engineering expertise specifically from the US, then you are correct.

  • avatar
    Rod Panhard

    Chrysler’s last innovation was the cupholder. They take credit for the water-cooled turbocharger, but that was inevitable.

    They’re not dead, yet. Try explain the deal to your high schooler or middle schooler, and that’s when you realize how stupid it is, from a business case, unless you’re Fiat.

    From a political perspective, it’s a good short-term effort to retain votes in Michigan.

  • avatar
    Nicholas Weaver

    200k-min: Correct, but with an important caveat…

    When I got my Mazda6, I looked at “What is ford, and what is mazda?” Mazda inflicted on Ford? Brilliant, its why Ford has the best I4 of the big 3.

    Ford inflicted on Mazda? Talk to owners of 626 automatic transmissions…

    On the V6 for the Mazda6 (gen1), the 3.0L V6 is a Ford block, but Mazda VVT heads and Mazda transmission.

    That engine then got transfered back to Ford…

    The Mazda/Ford relationship is about the only exception, where a hookup has proven valuable to both parties.

    It gave Mazda much needed financial stability in the 90s, and access to Ford’s supply chain. And its given Ford a top-class Japanese engineering team for things like engines, transmissions, and platforms.

  • avatar
    Robert Schwartz

    “Chrysler barely … went on to enjoy a relatively long spell of good health from the mid-60s through 1974, in part thanks to its successful performance image.”

    Also due to its indestructible slant 6.

  • avatar
    NickR

    I despise Eaton and Dumbler. I imagine that Chryco would have faced more crises down the road, but I am convinced they would have been on an upward trajectory right up until the current economic crisis had it not been for them. I am not a socialist by any stretch of the imagination, but I find it appalling that a foreign corporation can buy a North American one, completely fuck it up, walk away and leave countless people deprived of their livelihoods.

  • avatar
    ern35

    Chrysler was a perfect template of an auto manufacturer whose products I’ve never considered owning in 52 years of automobile ownership.

  • avatar
    tigeraid

    You forgot to mention all the effort and expense that went into developing the turbine engine in the 60s, which never panned out (shame, really).

  • avatar
    86er

    In the mid-nineties, Chrysler was on its ultimate manic high.

    A small point that the development of the ’93 Grand Cherokee, ’94 Ram, and ’95 Caravan did more to keep Chrysler going during that time than any of their LH cars or Neons ever did.

  • avatar
    Richard Chen

    @NickR: Don’t forget Lido: in 1993 Iacocca hired Eaton as Chrysler CEO over Bob Lutz due to personal animosity, then ganged up with Kerkorian in the mid-90’s when he was trying to take over Chrysler. Having spent loads of time and energy fending of the Kirkster, Eaton went looking for a partner. He felt that the Daimler tie-up would also prevent that distraction from occurring ever again, as well as having the synergy and financial strength to survive the anticipated auto manufacturer shakeout. Now, we’re seeing exactly what Eaton was trying to prevent. What those players are saying now:

    Robert Eaton: declining interviews, can’t blame him
    Lee Iacocca: in retrospect Lutz should have succeeded me
    Jurgen Schrempp: dunno, but he nailed his hot young secretary during the merger talks, got married to her afterwards

    More reading: Taken for a Ride: How Daimler-Benz Drove Off With Chrysler

  • avatar
    fincar1

    One thing I learned – in a couple of cases by buying them – is that 50’s and 60’s Chrysler products would keep running after a fashion, after years of no maintenance, when Ford or GM products would have long since died. Mid – late 60’s Chryslers, especially Imperials, are sought after for demo derbies because they’re hard to kill, and they’ll keep running with a quart of oil and a gallon of water left in them.

  • avatar
    jpcavanaugh

    Unlike ern35, my favorite cars over 30 years of car ownership were Mopars ranging from a 59 Plymouth Fury to a 77 New Yorker. I can’t speak to earlier or later eras, but the cars of the 20 year period of my experience were as bipolar as the company Ed describes.

    I will freely admit that it took a unique sort of person who could withstand the rollercoaster of thrilling highs and crashing lows. This is why Chrysler never got over 16-18% of the market in that era. But for those slightly off balance people who were Mopar guys, nothing else would do.

    The highs? Torsion bar suspensions that would outhandle everything else in the car’s size class. Torqueflite transmissions. Every single engine design sold in that period. The pushbuttons, followed by the smoothest shift lever in the business. Instrumentation that was more than a speedometer and a gas guage. The tight no-twist and no-rattle structure provided by the unit construction. Variable speed wipers. The full time power steering that enabled parallel parking by pinkie. The fender-mounted turn signals. The “Dryer-deer-deer-deer” of the starter. The keys that went in teeth-up. The doors you couldn’t lock yourself out of. See the kind of love these cars kindled? You guys know who you are.

    The lows? The cheap bodies. The cheap vinyl seats where every single seam split within 5 years. The ignition systems that could not seem to resist moisture. The electical systems that looked good only in comparison to Lucas. The carburetor icing on any 30-50 degree damp day. The window risers that would get so stiff you would break the know off the handle. Floor rust. The 9 inch drum brakes on the A bodies. The often horrid styling (just look at a 72 Plymouth Fury) and, the one that finally broke me, Lean Burn.

    My love affair continued to smolder a bit. The last vestige of the old Chrysler that continued to tempt me was the Ram Van and Wagon, and it was finally killed off after the 2003 model. I had a couple of chances to get one, but I let those chances pass. Too many design compromises on the ancient design, and all the used ones had rust holes at 7 years old, like they always did.

    Saying goodbye to Chrysler is sad. But we are saying goodbye to the New Chrysler Corporation. I mourn the old Chrysler that died 30 years ago.

  • avatar
    windswords

    NickR:

    “I am not a socialist by any stretch of the imagination, but I find it appalling that a foreign corporation can buy a North American one, completely fuck it up, walk away and leave countless people deprived of their livelihoods.”

    Isn’t that a reflection of our open auto market? Where EVERY other country with a homegrown domestic industry protects their market, we are the only ones who do not. Why protect one of the biggest industrial firms from a foreign takeover when you don’t even protect the market it exists in?

  • avatar
    NickR

    just look at a 72 Plymouth Fury

    Hey! I find they have their own offbeat, 70s kitsch charm. The droopy, melted 73 was worse.

    But as the article mentions…the 62 Dodges and Plymouths were horrid. Especially the Dodge, one of the most bizarre vehicles ever built (the 63 was marginally better).

  • avatar
    rudiger

    One of the primary things that had kept Chrysler afloat through all the mistakes for so many years was the military division. Ever since WWII, Chrysler management could screw up as badly as they wanted so long as the military division cash-cow continued to churn out tanks for the US military.

    But then came the seventies’ crisis and Iacocca. Lido has said in his first book that one of the most difficult decisions he had to make to keep Chrysler going was whether to continue building cars or military vehicles. Ultimately, it was the military division that went. It was the right decision for the time but, in the long run, not having the military division for the company to fall back on through the rough periods (as it had so many times in the past) would ultimately spell its doom.

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