10 Cars That Saved Their Companies From Bankruptcy
It’s never easy when a car company hits the wall, but that tends to happen every once in a while. Whether it’s the long-term bad business model or something as unpredictable as global recession, car manufacturers are under threat from bankruptcy more often than they’d like to be. It’s these high pressure situations that showcase the mettle of management and company as a whole. This is where some carmakers earn the second chance by buckling up and turning the tables in their favor. Unless, of course, they get bailed out by taxpayers. In any case, here are the 10 cars that have saved their companies from going under or facing prolonged barren spell.
Aston Martin DB7
You’ll be hard-pressed to find better example of a car saving its company than the Aston Martin DB7. British luxury manufacturer was struggling throughout the eighties and they were basically on the verge of going under when Ford stepped in, finalizing the complete takeover of the company in 1991, having bought majority of shares in 1987. The fruit of their joint labor was probably one of the most beautifully designed cars off all time (together with DB7’s direct successor, the DB9).
Although initially intended as a Jaguar F-Type and using XJ-S platform (together with numerous Ford components), there’s no doubt DB7 was a true Aston Martin. In addition, it was the first Aston to leave behind the traditional coachbuilding manufacturing methods. Apart from the standard straight-six DB7, coming of the new millennium saw the introduction of more potent V12 Vantage version of the car. A total of some 7,000 cars were manufactured over the decade which might not look like much, but surpasses the total of all previous DB cars combined. That alone speaks volumes about DB7’s role in saving the Aston as we know them.
There were a few cars that can be considered Porsche’s saviors like the 944 or more recently the Cayman, but neither managed to pull the Stuttgart-based company from the bankruptcy’s clutches like then new Boxster. Porsche’s lackadaisical manufacturing practice lead the company to near bankruptcy in the early nineties. In 1993, they only sold 14,000 cars total. Quite a downfall from more than 50,000 units in 1986. Furthermore, their cars were extremely outdated, although they still don’t look much different than they were almost 50 years ago. 928 was the youngest of the lot and it dated from 1977. 968 didn’t have that much of an impact and 911 was air-cooled and pushing 30. Moreover, they were all expensive and prices were rising still.
It was evident that Porsche needed a complete business model overhaul and that’s exactly what they got. They employed former Toyota engineers who quickly turned things around. Porsche’s manufacturing process wasn’t a cumbersome beast anymore, but a swift and agile predator, stalking its prey. The result was Mazda Miata-inspired affordable mid-engined roadster that still looked like, well… a Porsche. In fact, 986 Porsche Boxster and 996 Porsche 911 were practically the same cars. They even had the same engine architecture that differed in performance department. Germans now deliver around 225,000 cars a year (2015 data) and they owe a large chunk of that figure to Boxster.
BMW New Class
Although BMW 2002 comes to mind when thinking about the car that saved the Bavarians, it’s actually the New Class (Neue Klasse) that’s done that. 2002 did cement BMW’s position as the globally popular carmaker since 1966, but it was the BMW 1500, 1800 and 2000 that had saved them from going under and, in turn enabled the 2002 to happen. Prior to the New Class, BMW would only sell affordable mini cars or extremely expensive and outdated luxury cars that no one wanted. Small cars were a good model for post WWII Germany with devastated economy, but in early sixties, WWII was already a distant memory for quickly rebuilt Germany, now firmly on its feet.
After turbulent late fifties and flirting with bankruptcy or sale of the company to Mercedes-Benz, BMW started making a profit thanks to then new and fashionable sedans and coupes of the New Class. BMW 1500 appeared in 1962 and lasted through 1964. BMW 1600 would take over and last from 1964 to 1966, while BMW 1800 lasted from 1963 until 1972. Finally, BMW 2000 entered the fray in 1967 and left the stage in 1972 when BMW 02 series finally took over. Hadn’t there been for the BMW New Class, we’d probably be one German luxury carmaker short today.
Dodge Omni/Plymouth Horizon
Seventies were already a mess with OPEC oil embargo of 1973 and newly introduced catalytic converters. High fuel prices, high inflation, high unemployment, and high interest rates severely affected the US auto industry and especially large V8-powered cars. That lead to larger market share for imported cars and downsizing of the Big Three’s respective lineups. One of the first fruits of that practice were the Dodge Omni/Plymouth Reliant subcompacts produced by Chrysler.
Although they weren’t the most reliable Chrysler cars ever made (mostly due to being produced out of necessity and on a short notice), they were still much better than Dodge Aspen/Plymouth Volare. Moreover, they were arguably better than the likes of Ford Pinto and Chevy Vega. What’s more important is the fact that Omni and Horizon sold in droves, effectively saving Chrysler until the next oil crisis.
Ford also had quite a few less than good periods during their history. Eighties might have not been the worst, but Taurus was definitely the car that made the biggest difference. Its sweet mellow design was something entirely new for American auto industry. The original Taurus was so influential that it set the template for the next decade and a half. Soon after its introduction, every single car in the niche would feature similar design and shape.
But what it meant to Ford, apart from newfound recognition? It meant profit. In fact, Taurus was the best-sold American car for five consecutive years between 1992 and 1996. Ever since its introduction more than 30 years ago, Taurus has sold more than 8 million units. A number that would have probably been greater had it not switched from mid-size to full-size platform in 2007. Even then, however, sales were in sharp decline due to the new batch of more affordable Japanese sedans and Blue Oval’s shift of focus toward the Crossover/SUV market.
It can easily be argued if it actually saved the brand, but Buick Riviera certainly had a lot to do in establishing it the way Buick is today. Hadn’t there been for one of the most revolutionary cars in American history, Buick might have not survived to be bailed out by Obama’s administration and the Chinese who have embraced it as their own.
The idea came from Rolls Royce of all brands. When then GM design chief Bill Mitchell visited London and saw the high profile custom-bodied Rolls Royce he immediately thought it would look great provided it was a foot lower. Luxury prototype dubbed XP-715 was created for Cadillac division but they didn’t want it and neither did Chevy. Executives didn’t want to give it to Buick either since the brand suffered from one of the biggest sales droughts in its history. They had to employ McCann-Erickson to persuade the executive committee into giving the XP-715 to Buick. That finally happened in 1961 which meant Buick brand didn’t have much time to finalize the project.
Buick Riviera debuted in 1963 and it changed the perception of American personal luxury carriers. At least to some extent. It wasn’t the bulky, finned Cadillac, but more of a mashup between Rolls Royce and Ferrari. At least that’s what its creators thought. Limited to 40,000 units for the first year, Riviera sold out with ease. Even designer masterminds like Sergio Peninfarina and Sir William Lyons praised the Riviera. Although its sales quickly plummeted due to Mustang’s introduction and shift towards smaller muscle cars, Riviera (especially the first generation) still remains one of the most influential Buicks ever to have been made.
Mercedes-Benz 300 SL
Much like their arch rivals from the BMW, Mercedes-Benz too had fallen on hard times after the WWII. Their facilities were devastated, their production severely crippled and their assets seized in order to pay off the war reparations. Unlike the BMW, Mercedes-Benz started recuperating fast. And by fast, I mean by early fifties. It was the famous 300 SL Gullwing race car from 1952 that had won the 24 Hours of Le Mans, who’d propelled the German brand’s rise to stardom. 3.0L in-line six with world’s first direct injection was the fastest car of its time. It was so beautiful and successful that it spawned the street version which survived for almost a decade and was produced in 3,258 units (both coupes and roadsters).
Mercedes-Benz has Rudolf Uhlenhaut to thank for. He’s designed the meticulous gullwing coupe which was lighter and more aerodynamically efficient than its competitors even though it lacked the raw power of Ferraris of the time. Today they sell for more than $1 million (usually much more) which speaks a lot about their pedigree. Surely, Mercedes-Benz wouldn’t have been the powerhouse we know it today hadn’t there been for the 300 SL.
Peugeot 205 was neither the first nor the last hot hatch to have appeared on the automotive stage. It was one of the most important ones, however, for it saved Peugeot from somewhat rash decisions to buy then bankrupt Citroen and Chrysler Europe. These acquisitions put Peugeot in instant trouble and only thing that saved them (apart from 205) was the government who had backed them by imposing import restrictions on Japanese cars. Furthermore, Peugeot’s lineup was stacked with large family cars that people didn’t really need. Then came the 205 in 1983.
Peugeot 205 was an instant hit. Petite, yet spacious, this subcompact was efficient, reliable and above all beautiful. Motivated by numerous in-line four cylinder engines displacing between 1.0L and 1.9L (including diesels), 205 was sold in more than 5.3 million units winning numerous accolades in the process. Although it never reached the US shores (not in conventional manner, anyway), some might remember it for its 15 WRC wins shared between Finnish drivers Ari Vatanen, Timo Salonen, and Juha Kankkunen, between 1984 and 1986. Credits for 16th win go to the French driver, Bruno Saby. The most interesting of the lot was probably the 205 GTI which was dubbed the hottest hot hatch ever devised.
Dodge Aries/Plymouth Reliant
And while Omni/Horizon saved Chrysler from the first oil shock, Aries/Reliant did the same after the second oil crisis of 1979. Introduced in 1981 as the first K-cars, Aries and Reliant weren’t more than average mid-size cars available with the optional Mitsubishi engine. Although mediocre, both Dodge and Plymouth version sold over 150,000 units in their first year. Over the nine year long production span, they would sell north of 1 million units. Needless to say, that saved again vulnerable Chrysler badge from another bankruptcy.
The whole venture didn’t come without a certain risk involved. In order to fund the new K platform, Chrysler required $1.5 billion loan from the government. A move that would later pay off, and in the nick of time at that. Previous bad decisions (and there were a lot of them) really crippled the company and Chrysler has Lee Iacocca to thank for the bailout. Him and the Carter administration, that is. Even though the money was secured from the government, Dodge Aries and Plymouth Reliant have done their share as well. Not particularly inspiring as they were, they were still much better than Chrysler’s previous forays into the market.
Land Rover Range Rover (Evoque, Sport)
It’s not as much as the car that saved them from bankruptcy, but the man who’s done that. When Ratan Tata bought the Land Rover and Jaguar in a bundle from Ford in 2007, very few expected the company to make such a comeback. Then again, very few knew that Ford had finally made some progress with the British brands, but they needed to sell them in order to remain solvent. So when Tata Motors acquired the JLR, they already had a healthy base. Healthy, though still generating losses.
Their best move were the new Land Rover Range Rovers. That includes the original fourth generation Range Rover available since 2012, facelifted first gen and second gen Range Rover Sport, and Range Rover Evoque introduced in 2011. Over the course of eight years of Tata ownership (from 2008 until 2016), Range Rover trio has sold more than 1.5 million units. That’s an astonishing figure for luxury crossovers and SUVs. Just like modern day Buick, Land Rover also has the Chinese market to thank for such a turn of events. In 2003, for instance, JLR sold less than 500 vehicles in world’s most populated country. 10 years later, they were selling 100 times that – more than 50,000 cars.