Eagle

The story of the Eagle spans five automobile companies from four nations on three continents. Its cars were offered at dealer showrooms across the nation alongside the rugged and fabled Jeep. Close to half a million of them were sold throughout the decade of the 90s. Despite all that, you’ve probably never heard of Eagle. That’s too bad. The story contains all the elements of a good novel; romance and betrayal, farce and tragedy. It even produced a couple of excellent cars. The only thing the story missed was a purpose. No one ever stopped to ask what need Eagle filled. But then, if they had… we would have no story to tell. 

L’ Affair

Eagle was the bastard child of a Franco-American love affair gone bad. Its parents were an unlikely pairing of France’s largest carmaker and America’s smallest one. Giant Renault sought external solutions to its problems at home, while desperate AMC was simply trying to survive.

Our story begins in 1978, when Renault SA was one of France’s largest industrial companies and the sixth biggest automaker in the world. These were not easy times in recession weary Western Europe. Car sales were down, leading to underutilized factories, causing red ink to flow. But, being a state-owned company, Renault was not permitted to make business decisions based solely on business. The political needs of its largest shareholder had to be considered. As such, Renault could not, as its competitors were doing at the time, lower output to match slack demand. That would have meant lay-offs, which would stroke labor unrest, making French politicians very unhappy. Caught between a financial rock and a political hard place, Renault sought creative options to boost sales outside of troubled Europe. With America at the time by far the largest automobile market in the world, Renault cast a longing eye across the Atlantic. 

At the same time, American Motors Corporation was fighting for its life. AMC was the last of America’s great independent automakers. All the others - Willys, Hudson, Packard, Studebaker – had by the 1960s merged and/or collapsed. At one time or another each made crucial missteps, causing it to stumble and be crushed by the massive economies of scale and relentless marketing machines of Detroit’s Big Three. But AMC, the Little One from Kenosha, survived. Blessed with design creativity, resourceful management, sheer tenacity and a lot of luck, it soldiered on after the last of its peers had faded into history. 

But by the mid-1970s, AMC’s luck had run out. It had made a big bet on a radical new compact car called the Pacer, and lost. The Pacer had a love-it-or-hate-it design that too many people seemed to hate. Maybe it was because Pacer was billed as “the first wide small car.” Perhaps if they’d called it “the first short big car,” the story might have been different. But they didn’t, and American Motors now faced a dilemma. Its popular Jeep brand was earning profits of about $100 million a year. At the same time, the AMC car line - which, besides the polarizing Pacer compact, included a schizophrenic Matador midsize, and an ancient Gremlin subcompact - was losing about $100 million. What Jeep produced, the cars consumed. Nothing was left to develop fresh new models or modern, fuel efficient engines. The auto industry in the Seventies was going through rapid change. Stagnation now meant certain extinction. What AMC needed - and needed fast - was a fresh infusion of capital to jump start product development. What it needed was a sugar daddy with desire and a fat wallet.  

Once upon a time in the late 1950s, Renault had been the second largest selling import in America. It trailed only Volkswagen. But shoddy build quality and spotty parts availability meant Renault could never mount a serious challenge to its archrival from across the Rhine, let alone the coming Japanese onslaught. By the mid-70s, they were down to a haphazard collection of a few dozen dealers selling only a single model.

The Renault R5 had been a smashing success when it was introduced to Europe in 1971, a modern interpretation of the original Austin Mini, but with a sultry French accent. When it was brought here in 1976, Renault’s American marketers changed its name to Le Car - probably because they thought it was le cute. The Le Car developed what is called a cult following in the States, which is a polite way of saying that they didn’t sell many of them. 

Renault found itself shipping less than 1% of its worldwide output to the world’s largest car market. It seemed clear to management that if they were going to make inroads here - thus boosting production back home - they needed two things; a wider selection of cars better suited for Americans, and a much larger and stronger dealer network. The most efficient way to get both, they concluded in ever so French thinking, was to take an American lover.

But which one? The choices were limited. General Motors and Ford had strong European operations and therefore no need for Renault. Chrysler already had its relation romantique, with rival French suitor Peugeot, which was about to produce twin aspirings, the subcompact Dodge Omni and Plymouth Horizon. That left the Little One. With an established network of a couple of thousand AMC/Jeep dealers, and an AMC brass looking to be wooed, it meant all was right for a Franco-American love affair.

The two began to flirt late in 1978. A few months later - in time for Valentine’s Day - they consummated an agreement to co-develop a French compact car for the American market. By the end of the year the relationship had blossomed. Renault took a 22.5% equity stake in AMC for $150 million, plus an immediate additional capital infusion of $50 million. A year later, Renault had purchased a further $200 million worth of AMC stock, now owning 46%. In addition, it guaranteed a loan with French and American banks worth another $250 million. No cheap whore was AMC. The resourceful femme from Wisconsin now had the cash to finish developing a new light weight Jeep wagon called the Cherokee. It was a huge success when it hit the market in 1984, almost single handedly kicked off the SUV craze of the 80s and 90s.

On the other side of the ledger, Renault begin U.S sales of a sporty French-made 2+2 called the Fuego. It started out strong. Arriving on these shores in 1982, the Fuego was just the kind of exciting product AMC dealers had been begging for. But soon a mysterious electrical glitch caused a good many Fuegos to stop dead in their tracks, and not move again until they were towed to the nearest dealer. Some not even then, as no one, French or American, could figure out what was causing the seizures. Fuego’s sales seized up as well. 

The next lovechild of the partnership was an Americanized version of the well-regarded Renault 19 compact they named the Renault Alliance. The Alliance was a European car remade by the folks in marketing into what they thought Americans liked about European cars. Alliance was softer, cushier and a bit less satisfying to drive than its French cousin. No matter. Americans did like the Alliance… for a while at least. It won Motor Trend magazine’s 1983 Car of the Year award. AMC/Renault sold 125,000 of them that year. In 1984, when a hatchback model called the Encore was added, they sold over 175,000.  

But it wasn’t long before the enticing scent of Alliance’s French perfume wore off. Key components began to fail, some causing stalls, others a loss of steering. Recalls ensued, sales plunged and losses mounted, necessitating further requests to Paris for capital. By 1986, the French government had had enough. It announced it would allow no more of its money to be invested in American Motors. Renault would have to rid itself of its expensive mistress. 

A Rude Ending and Eagle’s beginning

By 1987, the Franco-American affair was over. Renault agreed to sell their controlling interest in American Motors to the Chrysler Corporation. Chrysler was flush with cash from their monumentally successful minivan introduced a few years earlier. Now it wanted to add the immensely profitable Jeep to its portfolio. In secret negotiations Chrysler offered $1 billion for AMC. The French wanted 2 billion. After prolonged and amazingly still secret haggling, they split the difference. Given Renault’s investment over the previous eight years, it was likely a wash. AMC’s management was informed of their company being sold via press release. There is no word on whether flowers were sent. 

Not a dime of that $1.5 billion was for the quirky AMC/Renault car division. Chrysler was interested only in the iconic Jeep brand, makers of the high margin Cherokee and Wrangler. AMC cars were too antiquated, Renaults too… French. The car side of the business was deemed worthless. But killing off AMC presented a problem. While AMC/Jeep dealers were profitable because they sold the rugged and newly hip Jeep, they still wanted that extra cash flow provided by what was left of the car business, both the sales and especially the service. With Renault now gone, and AMC forgotten, some kind of car line was needed to keep Jeep dealers happy and humming.

Chrysler needed a name for what would be its first new make of cars in 30 years. It didn’t have time for corporate America’s traditional and arduous process of naming, with consultants and focus groups and the like. For nomenclatural inspiration it instead turned to the only remnant of the pre-Renault AMC days –  the Eagle 4WD station wagon. AMC had always been short of cash but never ideas. The Eagle, when it was introduced in 1981, was basically a decade old Hornet wagon with a new and innovative 4WD system bolted on. Despite its antiquity, the Eagle is widely recognized as the first ever Crossover - thus inventing a category that now sells for more than 6 million annually. The Eagle brand was born.

The Cars of Eagle

The only appealing part of AMC/Renault’s car business was a modern new assembly plant in Brampton, Ontario that was financed by the French. Brampton had just ramped up to produce what would have been the pi`ece de re’sistance of the Renault partnership, a new midsize car called the Premier. This was the first - and last - true co-creation by the design teams of Paris and Kenosha. As such, the Premier got some of the best and worst of both clan waves. As all French cars, it had a nice supple ride. It was also fairly stylish - in an early-eighties Euro-chic kind of way. However, by the time the car made it to market it was the late-eighties. So the Premier looked dated right out of the gate. Quality, never a strong point for either company, was not helped by the teething pains involved in building an all-new car in an all-new factory. Put it all together, and the Premier’s impact on the midsize car market was, shall we say, minimal.

Chrysler also chose Eagle as an outlet to sell products from its long-standing partnership with Mitsubishi. For the past two decades, the Japanese company produced fuel efficient economy cars like the Dodge Colt and Plymouth Arrow, that helped Chrysler meet U.S. government mandated fuel economy standards. The first of the Mistu-supplied Eagles was a hastily tarted up version of the Colt. It was so forgettable and boring that this writer forgets what it was called and is too bored to look it up. 

But in 1990 Mitsubishi began exporting the Eclipse, one of the sharpest little sports cars ever to grace an American showroom. Eagle got a nearly identical version of the Eclipse called the Talon. There was also a Plymouth Laser sold through Chrysler-Plymouth dealers. These were taunt, muscular little stormers that put smiles on the faces of street racers and tuners everywhere. A customer could choose any one of the Mitsubishi triplets. They differed in trim bits only. But somehow that Eagle badge just looked a little bit cooler than the others. The 1990-94 Talon ended up being the most successful Eagle model ever, with a total of 144,000 sold.

Because of contractual obligations with Renault, Jeep/Eagle Dealers had to endure the Franco-American Premier for five more years, getting only 116,000 total sales to show for it. Their patience was finally rewarded in 1993 with a handsome, modern midsized sedan based on an excellent new Chrysler LH platform. The Eagle Vision was like the Talon, a blatant product of badge engineering; just a Dodge Intrepid with a different beak. But the Intrepid, like the Eclipse, was an excellent car on which to affix one’s badge. That the Vision never managed more than 28,000 sales in a single year spoke more about lack of interest in the Eagle brand than anything wrong with this sharp looking sedan.

Annual sales for Eagle had peaked at 69,000 in its second year. They leveled off at about 50,000 for the next six, before nosediving in 1995. Eagle was never able to get traction in the marketplace. No one, not customers, dealers, nor even the parent company, seemed to care. 

Not with a Bang but a Whimper

The Eagle brand was born of one merger, and it would die of another. By the late 1990s, Chrysler was busy prettying itself up to be wooed by yet another suitor from across the pond. This one offered bouquets of edelweiss and trays of strudel. Even with a thick German accent, it was quite clear that Daimler-Benz would have little use for Eagle, a brand even the French didn’t want. In September 1997, Chrysler Corporation announced that the Eagle was grounded. Few noticed. Six months later Daimler swallowed up Chrysler Corporation for $36 billion, in what creative PR-types termed a “merger of equals.”

Ironically, the Daimler-Chrysler marriage would last exactly as long as the Renault/AMC fling. Being a marriage, however, this one was considerably more expensive to break up. While Renault eccentially broke even on its American dalliance, Daimler essentially had to give Chrysler away in 2006 to a hedge fund called Cerberus Capital Management. Viva la France!

Sources and Further Reading

Books

American Motors: The Rise and Fall of America’s Last Independent Automaker  by Patrick R. Foster.  Motorbooks (Minneapolis 2013)

The Last American CEO  by Jason Vines & Joe Cappy.  Waldorf (Grapevine, TX 2016)

Both titles available at Olde Milford Press www.oldemilfordpress.com

Internet

Let Us Remember Eagle  by Jason Torchinsky.  www.Jalopnik.co

www.Allpar.com  - The source for everything Chrysler