Apparently no good deed goes unpunished in Auburn Hills, as Reuters reports that Lee Iacocca will lose his retirement benefits under Chrysler’s bankruptcy reorganization. The man credited with saving Chrysler from bankruptcy in 1979 will lose all of his supplemental executive retirement plan (SERP) benefits and his lifetime use of a company car, according to CEO Bob Nardelli’s testimony before Chrysler’s bankruptcy court. Although Chrysler’s employee FAQ states that “SERP contributions are placed in a trust fund and are not subject to creditors in the event of bankruptcy,” it seems that applies only to tax-qualified contributions. “We are required by law to stop the payments of non-tax qualified SERP benefits,” the FAQ reveals. Clearly Iacocca’s benefits fall into this category. Time to make another ad with Snoop Dogg?
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Love or hate him, Iaccoca deserves his pension and benefits much more than “Red Ink Rick” who should have been on a dollar a year salary with no stock benefits until GM could build a top 10 best selling medium or small size car.
I don’t actually mind my tax dollars going to pay Iaccoca cause he took a loan from the government and actually paid it back!
with interest!
@educatordan right you are, Iaccoca is twice the manager than Rick and his crew would hope to be Car for life eh? I got a car as part of my package
from GM.The way things are going I’ll be driving it, the rest of my life.
I know some of the haters will say that the K-cars were a POS (which many were), that he ran the company into the ground again only to save it with the LH cars were not that innovative, ect. But the man made money, it’s hard to argue with that.
OK, everybody. One more time here. Chrysler did NOT get ONE DIME from the government in 1979-80. The government guaranteed 1.2 Billion in private loans. If Chrysler would have gone under, the feds would have lost 1.2 bil. But it did not, and the government not only did not spend a dime, it received a boatload of warrants to buy Chrysler stock at a below market price and actually made a bundle for taking the risk.
That said, your main point is spot-on. Iacocca assembled a first-rate management team in 1979 and did a heckuvajob pulling through a situation that a lot of people considered hopeless at the time. A shame that he bobbled the final task of finding his replacement. Robert “Holy Crap even though we’re the most profitible carmaker in the US we are going to get crushed so we gotta sell out” Eaton was a disaster.
Lee, if you can find a better deal, “Take it!”
jpcavanaugh :
May 29th, 2009 at 1:18 pm
A shame that he bobbled the final task of finding his replacement. Robert “Holy Crap even though we’re the most profitible carmaker in the US we are going to get crushed so we gotta sell out” Eaton was a disaster.
I still can’t believe that he thought an ex-GM executive would know how to properly run a company.
Iacocca deserves every penny of his retirement. He really did do the impossible. Chrysler was as dead then as GM is now…. and he saved it.
I’ve actually been wondering if they were going to ask him to ride into battle again and try to do the same for GM.
It’s not a bad idea, you know…. The fact that he did it before gives him credibility.
I can see the ads now: “I said it before, and I’m saying it now – If you can find a better car buy it! The new GM”
Dammit! It just might work!
This is an interesting development.
We were always told at GM (unofficially – since us peons never saw the actual documentation for the plan) that the executive SERP was Chapter 11 proof.
Obviously a for a wealthy guy like Iaccoca this could be pocket change but a lot of retired execs may be sweating bigtime over this.
Please Iaccoca is not twice the manager that Wagoner was…….. He was actually at least a 100 times a better manager.
moedaman:
“I still can’t believe that he thought an ex-GM executive would know how to properly run a company.”
I have wondered about this myself. I can only explain it as the “anybody but Lutz” syndrome he had. It is well known that they did not get along. A lot of us here like to pick on Lutz, but one thing is sure, he would NEVER have sold out to Daimler. We will never know how history would have played out. My best guess is that once Lutz retired Tom Gale would have been the CEO – and I hope Trevor Creed would have never made it to VP of design!
Iaccocca was a great manager and deserves to keep his car and pension benefits. It seems like people who run a car company successfully, as Iaccocca did, get punished. I wonder if he could get Red Ink Rick’s golden handshake if he would come back to run the “new” GM. I like that idea.
He might have been 1000x better than Rick, he still sucked, and Chrysler was still a POS after he was done. Ghosn deserves his pension and plaudits, Iacocca definitely does not.
akatsuki,
“after he was done” was in 1993. So you mean from 1993 thru the next several years, the years that Chrysler was the most profitable automaker, the years they won all kinds of rewards. Was everything perfect? No, but when is it ever? They were very successful. End of story. Now I think that Lutz, Gale, Castaing, Pawley, Stallkamp, and others had more to do with it, but Lee let them do their thing and didn’t screw it up, except for his succession.
In taking away his lifetime company car, they’re actually doing him a favor – he just doesn’t realize it yet. Once he spends some seat time in a nice Japanese or European luxury car, he’s going to feel pretty embarrassed about his “if you can find a better car, buy it!” act from the ’80s.
@ Copper:
my bet would be while Chryco was owned by Daimler, Lee had more than his share of cool Mercedes rides.
Even worse than that (well, not for Lee) is the fact that Rick the Dick had Iacocca’s template to follow if he really wanted to save GM. Iacocca pulled Chrysler out of the fire with ONE basic model, dressed six ways, one truck, and one large and one small van. Rick chose Pontiac, Buick, and Saturn (cloned) minivans, the Giant Behemoth SUV, (cloned), and business as usual.
One thing that always amazed me was Iacocca’s timing. It was that and that alone that saved Chrysler. Chrysler had the K-Cars coming out of the assembly line in mid 1980, right when the nation was in a massive recession. Then, when the economy picked up and people started to splurge for bigger and more luxurious vehicles, Chrysler started to crank out the minivans and had them on showroom floors in late 1983.
Now, of course, he would fuck up later in the decade by sending out the Dynasty and New Yorker to compete with the revolutionary Taurus. (And naturally, the Taurus slaughtered them). But that is owed more to Iacocca’s traditionalism, and his false belief that the Taurus was too radical and would flounder. That is probably why he hated Lutz – Lutz wanted to build radical new cars while Iacocca was an extreme traditionalist who wanted to stick to simple three box designs. If I were to go by the Intrepid, I guess we can say that Lutz eventually got his way.