7 Car Brands That American Automakers Mismanaged
We Americans love our cars. For decades, we made the biggest and fastest cars in the world, and more of them than anywhere else, too. But for some reason, the rest of the world never really seemed to see things our way, building cars to better suit their needs instead. That was all well and good for American automakers, until they started selling over here, that is. Suddenly, the Big Three couldn’t wait to try their hand at European cars. How hard could it be?
Well, if history has shown us anything, very. While Ford and GM have international arms that have been successful for decades, somehow Detroit’s buying into and meddling in the European market has been troublesome at best, especially when it comes to premium brands. Over the years, The Big Three have snapped up some of the world’s most storied marques, only to bring them to the brink of disaster, or worse. Running the gamut from total neglect or untenable top-down management, Detroit has proven time and again that it’s completely hopeless when it tries to design a truly European car.
These 7 automakers were brought to their knees under Detroit’s mismanagement, and show just how bad things can get when Americans tell Europeans how to build European cars.
When Ford bought Jaguar in 1989, it set off a mild panic in the auto industry. American luxury cars were being trounced by European imports, so why not just buy out the competition? The answer, of course, is that managing European brands like an American auto division is a recipe for disaster. Jaguar’s lowest ebb is universally considered to be the ’01-’09 X-Type, a mid-sized sedan that was little more than a Ford Mondeo with a hood ornament and a little more leather. The company was all but left for dead by Ford during the global financial crisis, when it was sold to the Indian Tata Motors for just under $3 billion in 2008. In Tata’s first five full years of ownership (’09-’14), Jaguar has turned a profit every year. During Ford’s 18-year tenure, it never had a single year in the black.
No other automaker was run into the ground by American ownership as badly as Saab. It was a consolation prize for GM, which had tried to take over Jaguar, but had been publicly denied. Determined to save face and buy a premium European marque, it settled on Saab, buying a 50% stake in 1989 for $600 million, and the rest in 1999 for an additional $125 million. At the time, it wasn’t a bad idea – Saab had been the fastest-growing luxury brand in the U.S. in the mid-’80s – but under GM’s thumb, the brand withered and died. The famously independent company essentially ignored GM’s directives to build badge-engineered Opels, and buyers jumped ship as already unpopular models aged into obsolescence. Spurned during GM’s bankruptcy proceedings, Saab faltered under several different owners before shutting its doors for good in 2011. Today, the brand is little more than the intellectual property of a Chinese holding company.
Ford is one of the biggest offenders when it comes to mishandling European luxury brands, and it wasted years and lost billions lumping Volvo, Land Rover, Aston Martin, and Jaguar into its Premiere Automotive Group. Treating these disparate brands as a single entity was a recipe for disaster, as brand loyalists left in droves once they realized their beloved cars were little more than re-skinned Fords (the V50, pictured above, shared its mechanicals with the Ford Focus). Volvo under Ford hit a high point in 2004, selling 139,384 cars stateside. Within four years however, Volvo was selling less than half that, and sales have continued to slide ever since. In 2009, the Swedish automaker was sold to Chinese company Geely for $1.8 billion. In 1999, it had a $6.8 billion price tag on its head.
By 1972, Lamborghini was in such dire financial straits that even the company’s namesake jumped ship. Over the next 15 years, the company limped through two owners and bankruptcy before being bought by Chrysler in 1987 for a paltry $25.2 million. In a classic case of mismanagement, the company’s brass wanted to essentially control Lamborghini’s operations from Detroit, and two disastrous concepts, the Bertone Genesis minivan, and the Lamborghini Portofino sedan proved to the world that Chrysler had no business building supercars. Despite releasing the Diablo under its watch, when Lambo began hemorrhaging money in the early ’90s, Chrysler cut its losses and sold the company to an Indonesian conglomerate, where it languished until the Volkswagen Auto Group bought it in 1998.
Launched in 1985, Merkur was Ford’s attempt to take on the rising tide of European imports by selling its German Sierra (pictured above) and Scorpio models stateside as a separate premium brand. Unfortunately, they were overpriced, poorly marketed, and never quite caught on with Ford dealers or the American public, quietly disappearing after 1989. It’s a shame too, because the cars themselves were pretty good, and considering the number of Ford’s European performance cars we’ve missed out on since, Merkur could’ve become the gateway to Old World-style speed that we never had.
6. Chrysler Europe
Chrysler never had the presence that Ford and GM had in Europe, but that’s not because it didn’t try. Chrysler Europe was formed in 1970 after the company completed a decade-long buying spree, snapping up brands like Hillman, Sunbeam, and Humber (the Rootes Group from England), Simca from France, and Barreiros from Spain. But the endeavor was a complete failure, and in 1978, Chrysler sold off its entire European arm to Peugeot Citröen for one U.S. dollar. On the bright side, it was able to poach the Simca Horizon and turn it into the multi-million selling Dodge Omni and Plymouth Horizon in America.
It may be little more than an automotive footnote here, but Opel is one of the oldest auto manufacturers in the world. In 1929, GM sought to expand into the Old World and took over the German company. Despite holding on to it through shady business dealings during World War II, the company has since gone on to become GM’s most important brand in Europe. Best known stateside for its GT sports car (pictured above), and compact models sold through Buick dealerships in the ’60s and ’70s, the company disappeared in the early ’80s as GM tried to cash in on the Japanese import craze – unsurprisingly, not many Americans went for the Buick Opel by Isuzus (Yes, that was the model name).
Mildly rebadged Opels have since been sold here as Cadillac Cateras, Saturn Astras, and Buick’s current Verano and Regal sedans, among others. But since 1999, GM-Opel has lost nearly $20 billion in the European market, and the recent collapse of the Russian economy has forced the company to cut further production at two plants.
Like classics? It’s always Throwback Thursday somewhere.
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