The May 1966 issue of Motor Trend included an unusually long article about the woes of American Motors. The piece was written by Editor Donald Mac Donald, so presumably it displayed the magazine’s most sophisticated punditry. Yet it didn’t do a whole lot more than traffic in Detroit groupthink in rather vague, contradictory and petty ways.
Mac Donald started off by saying that AMC was coming up on its 12th birthday — and that there was “a real and substantial question” of whether the automaker would stay in business another three years. Yet his entire essay, which stretched across two pages with minimal graphics, offered little hard data that backed up his contention that American Motors was in such dire straits that it could go belly up.
For example, he implied that the loss of 339 dealers in 1965 was a “very big” problem “by any standard” but didn’t mention the total number of dealers and what was a normal churn rate.
Mac Donald instead paid more attention to offering colorful turns of phrase, such as that AMC president and CEO Roy Abernethy “knows his business as thoroughly as a fleet admirable knows the innards of his flagship.”
Meanwhile, Mac Donald got petty by criticizing Abernethy’s predecessor George Romney for not saying something nice when asked about AMC’s outlook. Romney had stated that “I have not been connected with the company or had any part in its affairs since the fall of 1962. I will say that the company product and competitive program are not the ones I would have followed.”
What’s wrong with being honest? “Grim AMC executives, all of whom have gone out of their way for years to speak of Romney only in the kindest of terms, kept their mouths shut tight, although various competitors were appalled at Romney’s lack of, well, tact,” Mac Donald wrote.
Questioning AMC management was okay until it wasn’t
What’s curious is that earlier in the essay Mac Donald suggested that American Motors had suffered from a board of directors that did not typically show enough independence to raise questions of management. Didn’t Romney just model what was needed? And since he had a record of success, might it not be worth exploring more deeply why he apparently thought the automaker had gone astray?
No can do. Mac Donald instead hammered on what he seemed to see as AMC’s core problem: that Abernethy and his team had not made a “clean break” from Romney’s approach, which was no longer in sync with a changing market.
Also see ‘Would AMC have done better if George Romney had stayed longer?‘
The irony is that Abernethy had spent a lot of money shifting American Motors away from Romney’s playbook of a narrow line of economy cars that emphasized practical improvements rather than frequent restylings.
As a case in point, the 1964 American was reportedly larger than what Romney had proposed while the mid-sized lineup was given a more rapid reskinning and a much broader range of body styles and models. In contrast with Romney, Abernethy tried to match the Big Three model for model — and follow its lead by introducing top-end luxury and sporty models.
Abernethy pivots — but apparently not hard enough
Mac Donald minimized the importance of Abernethy’s pivot away from Romney’s playbook, arguing that the Classic and Ambassador “remained saddled with thoroughly imbedded reputations for economy, at a time when economy was almost a dirty word.”
If that was indeed the case, then why did Volkswagen sales soar past AMC’s in 1966 even though the German import fielded a much narrower lineup of slow-changing economy cars? Mac Donald was so Detroit-centric that he didn’t recognize how there was a growing market for economy cars — but they needed to be fun to drive.
Also see ‘AMC’s Roy Abernethy was increasingly hemmed in but not without options’
Instead, he went on to declare that Abernethy’s new halo coupe, the Marlin, had “failed dismally” because it only sold 9,000 units in 1965 — “scarcely enough to justify advertising expenditures, let alone tooling.”
To be fair, the Marlin was a relatively low-cost Classic variant that sold better than AMC’s mid-sized convertibles in both 1965 and 1966. Thus, it seems reaching to call it a dismal failure. However, as we have discussed here, American Motors also made plenty of beginner’s mistakes in entering the sporty-coupe market.
More performance was needed . . . until AMC offered it
Mac Donald also threw cold water on the prospects of a 1967 redesign of its mid-sized platform. He wrote that “already there are AMC executives who are privately and glumly forecasting that the restyling is uninspired and inadequate, in view of the competition.” What did they expect, the equivalent of a 1968 Pontiac GTO?
Left unexplored was whether such a tiny automaker could realistically keep up with the Big Three’s annual-model-change arms race. Romney didn’t think so.
Just getting revved up, Mac Donald proceeded to question why AMC spent around $40 million for a new V8 engine. While it’s true that the automaker could have squeezed more life out of its existing V8, Mac Donald didn’t acknowledge that it was apparently too large to fit into AMC’s compact platform. Wouldn’t that be a problem if he thought there was a need to shift away from an economy image?
For example, how could American Motors field a compact pony car like the 1968 Javelin — which was then under development — with only six-cylinder engines?
A good reason why Abernethy was sour on the press
An AMX concept car could “attract attention and sales” if it reached production, Mac Donald thought, but it could only be a stopgap model. “Eventually, AMC has to achieve solidity, distinctiveness — and most importantly — uniqueness. It is not large enough to combat the Big Three on their terms. It must find its own individual product offering, one that sets it apart from its big brethren, yet embodies enough appeal to attract at least 500,000 customers annually.”
That’s sort-of true in theory, but Mac Donald arguably set the bar far too high sales-wise. American Motors didn’t even reach 459,000 units in its peak year of 1960. Maintaining anywhere close to that level of production was unlikely in the late-60s due to tougher competition from both the Big Three and imports.
Also see ‘Five questions about Aaron Severson’s take on American Motors’
Nor did Mac Donald acknowledge how Romney did a better job than Abernethy of setting American Motors apart from the competition — and keeping fixed costs low with an unusually narrow lineup. Historian Patrick Foster (1993) has rightly criticized Abernethy for trying to compete too directly with the Big Three.
So in a way Mac Donald let Abernethy off too easy. However, his overall assessment of American Motors was so negative and contradictory that it is hard to see how management could win. Near the beginning of his essay, Mac Donald wrote that Abernethy had “turned sour on the press” because it was “hacking unfairly at him.” If this essay is any indication, I don’t blame the AMC head for thinking that way.
NOTES:
Specifications and sales/production figures from the auto editor of Consumer Guide (2006) and Gunnell (2004).
RE:SOURCES
- Auto editors of Consumer Guide; 2006. Encyclopedia of American Cars. Publications International; Lincolnwood, Ill.
- Foster, Patrick R.; 1993. American Motors: The Last Independent. Krause Publications, Iola, WI.
- ——; 2017. George Romney: An American Life. Waldorf Publishing, Grapevine, TX.
- Gunnell, John; 2004. Standard Catalog of Volkswagen, 1946-2004. KP Books, Iola, WI.
ADVERTISING & BROCHURES:
- oldcaradvertising.com: Rambler American (1966)
- oldcarbrochures.org: AMC Ambassador (1966, 1967); Rambler (1965)
“Eventually, AMC has to achieve solidity, distinctiveness — and most importantly — uniqueness. It is not large enough to combat the Big Three on their terms. It must find its own individual product offering, one that sets it apart from its big brethren, yet embodies enough appeal to attract at least 500,000 customers annually.”
We can quibble about the numbers but his assessment is true, almost a truism. The Big 3 could spread platforms over three or four makes. Also, luxury and sporty additions are just different trim levels for the most part. It seems to me like a low cost high margin expansion of the line. But here’s the catch. You can compete with the Big 3 directly like Abernathy seems to have intended, not on a full Chevy-to-Caddy range, but cover say, Pontiac or Dodge COULD be possible but at substantial expense. The other course of action is apparently what Romney wanted, to make small fuel efficient cars. The corollary is the space efficiency the small European cars offered. Everybody has compact and midsized cars on the American plan. You can’t re-invent the Pontiac Tempest or the Mercury Meteor. Take a serious look at the BMC Mini and the smaller BMWs. This will involve a lot more than stretching, shrinking, and occasionally reskinning whatever RWD live axle platform is on the line at Kenosha. It will also cost a lot more, probablu more than AMC can afford. And, if AMC does pull this off maybe, just maybe, the big 3 execs might pull their heads out of their exhausts and do a crash program like the stillborn Ford Cardinal grabbing stuff out of the parts bins in the UK and Germany and using this technology to build cars for American tastes. Then of course AMC is out produced by the big 3 after being their beta tester.
Romney retired from AMC in February 1962. The 1964 American was introduced in August 1963. It seems quite likely that by the time of Romney’s retirement, AMC would already have been at the prototype stage, if not already ordering tooling. Same for the addition of the hardtop to the 1964 Classic and Ambassador lines. Leaving aside the Marlin, as of 1966, Abernathy would have been responsible for at most the 1965 Classic/Ambassador reskin and the 1966 hardtop roof. It was largely still Romney’s product line. The disaster of the 1967 line was yet to come as of the time this was written.
Yes, with the benefit of hindsight, Abernathy’s choices didn’t work. But I have a lot of sympathy for him. I still don’t see how Romney’s strategy could have withstood the steamroller of the GM A Bodies. They were well made, well sized, well priced, well styled, economical enough and had more pride of ownership than an ascetic Romney Rambler.
For 1958, AMC could have offered Nash and Hudson as before with better styling. Some of the proposed designs seemed in step with other makes at the time. The Ramblers of 1958-1962 were fine cars that sold well.