History may be repeating itself. Around Detroit, Iacocca’s role in the attempted takeover of Chrysler has sparked as much talk as the bid itself. The immediate question was “Why Lee?” At 70, he could be happily retired. He has houses all over the world, from Palm Springs to Italy. He’s funded a diabetes foundation, started new ventures in banking and gambling. He even flew to Havana to meet Fidel Castro, reportedly joking he might play “peacemaker” between the United States and Cuba. But Iacocca isn’t happy. He’s in the middle of a nasty divorce. He wants more money. Most of all, say those who know him, he resents his treatment by Chrysler. Critics warn he seeks revenge, and that in getting it he might inadvertently wreck the company. Says an industry insider: “Lee has no idea what, with his ego, he has done.”
Iacocca twice rescued Chrysler from collapse. But two years ago the company forced him to retire, even though he wanted to stay on as chairman. He had lost touch, the board felt, and wouldn’t choose a successor. He was criticized for making too many commercials and for getting sidetracked by public crusades such as sprucing up the Statue of Liberty. The hyperkinetic Iacocca didn’t go into easy retirement. He started a bank, Iacocca Capital Partners, in L.A. He joined the board of Kirk Kerkorian’s MGM Grand. Lately he’s been doing joint ventures with Native American investors to build casinos on tribal lands.
Worth some $200 million, Iacocca apparently wants more money. “He once told me he doesn’t count himself rich,” says an editor of one of Iacocca’s books. “He knows guys on Wall Street who can make a million bucks in a couple days.” But money isn’t the main reason he’s going after Chrysler, if you believe the buzz from Detroit.
As auto-industry watchers tell it, Iacocca wants to regain his place in the industry-and show that Chrysler’s board was wrong to shove him aside when it did. He resents being taken off the company’s powerful Executive Committee, chaffs that Chrysler didn’t name its new headquarters “Iacocca Center.” “This isn’t a money grab by Kerkorian,” says one prominent analyst. “This is Lee trying to get back. He’s still chasing the ghost of Henry Ford.”
Iacocca refused NEWSWEEK’S requests for an interview. But a spokesman denies that Iacocca wants to run Chrysler again. “He’s only an adviser to Kerkorian. He has no intention of going back into the automotive industry.” Yet Iacocca is quick to criticize. While Chrysler’s stock has languished, GM and Ford are doing better. “Investors are starting to say, ‘Maybe they’ve got a raft of problems they’re not telling us about’,” he told The Detroit News last week.
Iacocca believes that Chrysler has to think bigger, market its cars more aggressively, push up quality. To The Detroit News, he talked of keeping Chrysler’s current management, including successor Robert Eaton-but establishing a new “super board… guys with vision and strategic planning.” Like himself, presumably. Iacocca wants to “call some of the big-picture shots,” says Steve Miller, vice chairman of Chrysler until 1992. Terry Christensen, an MGM board member and Iacocca attorney, agrees. He says Iacocca’s role would be “special projects, but I can’t go into details. Of course, be would be a member of the board.” That makes Chrysler’s top executives edgy. It isn’t clear whether Eaton would stay on if Iacocca returned. Indeed, insiders are already talking about an “exodus” of top managers. But for Iacocca, that might be the last laugh.
