Iacocca’s passing throws up memories of Detroit in its heady days

The news of Lee Iacocca’s death brought back memories of the 1980s when my generation in India was virtually smitten by his book.

This racy narrative of a boy, born of Italian immigrants, who rose to the top at Ford Motor Company was gripping stuff. Even better was the feud with the top boss and the move to quit Ford and turn around a struggling Chrysler.

Indians loved the book, Iacocca , and I remember it being quite a craze in the mid-1980s. It had all the ingredients in place to attract readers and they loved the idea of someone being pushed to the ropes and still bouncing back with a bang.

Iacocca was published during the time when Detroit was the epicentre of the global automobile world; the Japanese were doubtless making a significant impact in the US but the likes of General Motors, Ford and Chrysler were still going strong. German brands like Mercedes and Volkswagen were, of course familiar, but Detroit was the ultimate seducer.

It was in this world where Lee Iacocca grew and flourished. He made profound impacts during his stints at Ford and Chrysler where he fought hard and succeeded. When Iacocca hit the stands in India, the country was experiencing the first phase of change with a small car-maker from Japan.

Nobody would have thought then that Suzuki would eventually dislodge Hindustan Motors and Premier Automobiles from their comfortable positions in the market. India was also going through a Japanese wave in small commercial vehicles where the likes of Mitsubishi, Mazda, Toyota and Nissan were making a mark. They were not as lucky as Suzuki and were quickly wiped out by a local player, Telco (the present Tata Motors), with its 407 model.

The 1980s was also the time when the Japanese were taking the first steps in India’s two-wheeler arena. This was to have significant repercussions in terms of ushering in the motorcycle revolution and showing the door to the traditional geared scooter. Honda, Suzuki, Yamaha and Kawasaki are still around with varying degrees of success (and failure).

In this largely pervasive Japanese ecosystem, how did a book like Iacocca make such an impact in India? Well, for one thing, it made for great reading and had enough and more to offer. After all, the rags-to-riches story is something that appeals to everyone and this had a lot more in terms of boardroom feuds, intrigue and so on.

Two, its writer said it like it is with no holds barred. This was shooting straight from the top without any attempt to make the script syrupy and sweet. The fact that a man took on the high and mighty before moving elsewhere to weave his magic was heady stuff. Lee Iacocca was tough and spoke from the heart; his book made a huge connect with readers.

Indians were equally starry-eyed about the US since this is where everyone wanted to be in terms of education or permanent living. American car brands, which were directly imported, were still favored by the elite even while Suzuki was heralding a new phase in the country with its people’s car. Yet, even in the world of Iacocca, change was already happening with the Japanese now making significant strides in the US. The fuel shock of the early 1970s was a reminder that big was not always beautiful, mileage was something that was equally critical and this is where the Japanese offered a solution. The fadeout of Detroit also began happening soon after, though very gradually. The first big change was the Daimler, Chrysler merger of the late 1990s, which promised the moon but ended up catastrophically. By the time the divorce was finally made, it was a battered Chrysler that emerged from the ruins.

While the Japanese were now firmly in the driver’s seat with the likes of Toyota and Honda leading the surge, the Koreans were now keen on going global. Over the years, Hyundai has emerged among the top car-makers of the world as also Kia, its group company.

The Lehman crisis of 2008 that brought the world to its knees pretty much crippled Detroit too. The US government had to step in to bail out the Big 3 in an exercise which saw Fiat snap up Chrysler.

GM is back on its feet but clearly sees China as its most important market where it is comfortably averaging over 3.5 million units annually. It has cut back on operations in a host of other regions, including India, and is now clearly redefining its priorities. As for Ford, it managed the aftermath of the Lehman crisis a lot better but is now ready for new partners in the new global order of mobility. An alliance with Volkswagen that is underway will throw up something concrete soon in terms of its scope and objectives. In India, Mahindra & Mahindra will team up with Ford in a bigger global play that could include ASEAN, South Africa and Latin America.

The Detroit where Lee Iacocca was once an active participant has clearly changed. Sure, the old brands are still intact but they are now operating in a very different landscape. CEOs have to navigate their companies with greater circumspection since it is no longer a walk in the park.

China is now a force to reckon with, quite unlike the heady ‘60s and ‘70s (up to the mid-80s) where Detroit called the shots. Beyond SAIC, you have the likes of Geely, Changan Auto and Great Wall Motors which are keen on making their presence felt across the world.

Further, the automobile industry is now up against a host of new challenges like autonomous driving, electrification and connected cars, which call for new competencies. Diesel is a bad word in parts of Europe, which means that fuel realignments become important.

The days of Iacocca were doubtless tough too as CEOs constantly faced a host of challenges. Yet, there was a sense of irreverence, daring and courage, which clearly separated the men from the boys. Detroit was part of this legacy which is now no longer the case since the mantra for survival has changed over the years. A pity but inevitable.

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