The lineage of the Eagle brand spans five automobile companies from four nations. Eagle was paired with the fabled Jeep line. It sold close to half a million cars over 10-years. Despite all that, you’ve probably never heard of Eagle. Too bad. The story of contained the elements of a good novel; romance, 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 asked, we would have no story.
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. One sought overseas solutions to problems at home. The other was simply trying anything to survive.
In 1978 when our story begins, Renault SA was one of France’s largest industrial companies and the sixth biggest automaker in the world. These were not easy times in a recession weary Western Europe. Car sales were down, leading factories to be underutilized, causing red ink to flow. But, being a state-owned company, Renault could not make business decisions based solely on business. The political needs of its largest shareholder had to be considered. As such Renault could not significantly lower output to match slack demand. That would have meant lay-offs, increasing unemployment, and making French politicians very unhappy. Caught between a financial rock and a political hard place, Renault was forced to seek creative options to boost sales outside of Europe. With America by far the largest automobile market in the world, Renault cast a longing eye across the Atlantic.
At the same time, American Motors Corporation of Kenosha, Wisconsin 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 mid 1960s merged and/or collapsed. At one time or another each made crucial missteps, causing them to stumble and be crushed under the weight of Detroit’s Big Three automakers and their economies of scale and relentless marketing machines. 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.
By the mid-1970s, however, AMC’s luck had run out. It had bet big on a radical new compact car called the Pacer. The Pacer had a love-it-or-hate-it design that too many people seemed to hate. 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. To be stagnant in an industry caught in a period of rapid change 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 Renault had been the second largest selling import in America, trailing only Volkswagen. But shoddy build quality and spotty parts availability meant it had no chance against its archrival from across the Rhine, let alone the coming Japanese onslaught.
By the mid-70s, Renault was 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 they brought it here in 1976, American marketers changed the 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 was 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 at 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 achieve 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 had no need for Renault. Chrysler already had its relation romantique, with rival French suitor Peugeot. That left the Little One, AMC. An established network of a couple of thousand AMC/Jeep dealers, along with an AMC brass looking to be wooed, 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 it seems, AMC now had the cash to finish developing a new light weight Jeep wagon called the XJ Cherokee. The Cherokee was a huge success when it eventually hit the market in 1984. It 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. When the Fuego arrived in 1982, it 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 product of the partnership was an Americanized version of the well-regarded Renault 19 compact that the marketers renamed the Renault Alliance. The Alliance was a European car reworked by Europeans 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. It won Motor Trend magazine’s 1983 Car of the Year award and 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.
It wasn’t long before the Alliance’s enticing scent of French perfume began to wear 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 capitol. 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 and wanted to add 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 eight years, it was likely a wash. AMC 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, sellers of high margin Cherokees and Wranglers. AMC cars were too antiquated to be worth anything, Renaults too French to succeed in America. AMC’s car 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 needed that extra cash flow provided by what was left of the car business, both the sales and the service. With Renault now gone and AMC forgotten, Chrysler needed to find its newly acquired dealer body a fresh face to sell.
The company needed a name for its first new make of cars in 30 years butdidn’t have time for the arduous process of corporate naming. The only remnant of the pre-Renault AMC days was the Eagle 4WD station wagon. AMC was always short of cash but never inspiration. The Eagle, when it was introduced in 1981, was basically a decade old Hornet wagon with a new and innovative 4WD system tacked on. Despite its antiquity the Eagle is widely recognized as the first ever cross-over, thus inventing a category that now accounts for more than 6 million in annual sales. The Eagle brand was born.
The Cars of Eagle
The only appealing part of the AMC/Renault car business was a modern assembly plant in Brampton, Ontario. Financed by French capital, Brampton was just ramping 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. It was 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. 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 plant. Put it all together and the Premier’s impact on the midsize car market was, shall we say, minimal.
Chrysler also chose to use Eagle as an outlet to sell products from its long-standing partnership with Mitsubishi of Japan. For the past two decades, the Japanese company’s well-designed, fuel efficient cars helped Chrysler meet U.S. government mandated fuel economy standards. The first of the Mistu-supplied Eagles was a tarted up economy car so forgettable that wasn’t worth the effort to remember what it was called. 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 called the Talon. There was also a Plymouth Laser. These were taunt, muscular little stormers that put smiles on the faces of street racers and tuners everywhere. A customer could choose one of the Mitsubishi-sourced triplets from any of the three brands. They differed in trim bits only but somehow that Eagle badge just looked a little cooler. The 1990-94 Talon was the most successful Eagle model ever with a total of 144,000 sold.
Jeep/Eagle Dealers had endure the Franco-American Premier for five 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 as blatantly a product of badge engineering as was the Talon, just a Dodge Intrepid with a different beak. But the Intrepid, like the Eclipse, was an excellent car. 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 the Eagle 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 - customers, dealers, 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 its own suitor from across the pond. This one spoke with a German accent. Accent or not, it was immediately clear that Daimler-Benz would have little use for a brand the French didn’t even want. Chrysler Corporation announced in September 1997 that the Eagle was grounded. Few noticed.
Six months later Daimler swallowed up Chrysler Corporation for $36 billion in what creative PR people termed a “merger of equals.” Ironically, the Daimler-Chrysler marriage would last about as long as the Renault/AMC fling. Being a marriage, not an affair, this one was considerably more expensive to break up. While Renault for the most part broke even on AMC, Daimler essentially gave Chrysler away in 2006 to a hedge fund called Cerberus Capital Management. Viva la France!
Copyright@2018 By Mal Pearson