Chrysler Chairman Robert Eaton took home a $8.19 million paycheck last year.
The carmaker’s previous chief executive, Lee Iacocca, did seven times better. His take after a bruising battle with Eaton for control of the automaker was $53 million–$21 million from Chrysler and $32 million from billionaire Kirk Kerkorian who joined Iacocca in the fight.
Neither Eaton nor Iacocca would have come close to those figures at Chrysler had it not been for an aggressive and creative colleague named Harold K. Sperlich.
Sperlich has been gone from Chrysler for nearly a decade, but his efforts still are paying huge dividends.
He was the product planner behind the K-car line and even more important, Sperlich is the acknowledged father of the mini-van. Without the mini-van, Chrysler wouldn’t exist, an opinion held by industry executives, media observers and Sperlich.
Eaton and Iacocca also can thank the late Henry Ford II, who fired Sperlich before he went to Chrysler in 1977. Sperlich was vice president of product planning, when Ford ordered Iacocca to fire the innovator, which he did reluctantly.
Sperlich, who earned an MBA from the University of Michigan in 1961, was a “comer with a chance of rising to the top CEO job of Ford,” said Walter T. Murphy, a top aide to Iacocca and retired executive director of public relations in the heyday of the Mustang, another Sperlich product.
“Hal was brilliant, imaginative, aggressive. He was soft-spoken, laid-back until he became the opposition on a certain issue. Then, he set his seat in concrete and defied anyone to push him.”
Sperlich had his boosters at Ford and Chrysler, but Ford II was not one of them. A confidential Ford corporate publication contained data and photos of the top executives. Sperlich’s full-page picture had an X across it from the pen of Ford, according to a corporate executive.
“My problem with Mr. Ford was that I treated him like a chairman of the board and not as an emperor,” according to Sperlich. “I never showed him the deference he seemed to enjoy.”
Sperlich and Iacocca, along with several other executives such as chairman-to-be Donald Petersen, pushed for the development of the Mustang in 1960. Another Mustang pioneer was Donald N. Frey, a professor of business at Northwestern University.
“Hal was a junior spark plug, very bright, very effective,” said Frey, the automaker’s top product planner and Sperlich’s boss in the mid-’60s. “On Mustang, Sperlich was heavily involved in tooling and budget issues. He was able to use parts of the Falcon car on the sporty new model.
“Hal was also very outspoken, opposed Henry Ford many times (on the Mustang, front-wheel-drive and the mini-van). He was also closely identified with Iacocca, and I think Ford figured he could wound Iacocca by firing Sperlich.”
Frey said he could see a split coming between Ford and Iacocca a decade before Iacocca was fired in 1978.
Sperlich started thinking mini-vans at Ford in the ’60s. “I saw the need for a flexible utility vehicle that could haul people, luggage and cargo. There was a market for utilities that was not being served. Normal sedans and station wagons had the limitations of their configurations. The wagons were really four-door sedans with tall trunks. And the larger vans, like Ford’s Club Wagon, were not user-friendly.”
Sperlich concluded his concept required front-wheel-drive because rear-wheel-drive prevented lowering of the floor, which had to cover the rear differential and driveshaft. “To be a friendly utility vehicle, the floor had to be flat,” Sperlich recalled, “and we just couldn’t get it low enough with rear-wheel-drive.”
Ford and Chevrolet had offered vans that were taller and trucky, said Sperlich. “They were not friendly utilities. By friendly, I mean a concise package, not too high to be garaged, easy to get into and get out of.”
Sperlich aimed his mini-van at the housewife, who would get a greater command of the road from the high driver’s seat.
But Ford Motor balked at the concept, which was new with no historical evidence of a market.
Henry Ford shot down the mini-van, and, a year after being fired, Sperlich took his concept to Chrysler Corp., which was in serious danger of collapse.
Sperlich then helped persuade the also-fired Lee Iacocca to come to Chrysler in 1978.
“We had been developing a mini-van program at Chrysler but waited until Iacocca arrived and approved it. Ford didn’t believe the market existed, but Lee did. Many Chrysler people were opposed to the mini-van, but I was the advocate and Lee was the authority of approval. So, we had a quorum of two and it was approved.”
Besides, Chrysler was using a front-wheel-drive platform before Sperlich arrived on the compact L-body Omni and Horizon lines. The upcoming K-car line also was front-wheel-drive.
“Hal knew how to make cars, how to market cars and how to sell them,” said Jack Withrow, executive vice president for product development under Sperlich at Chrysler. “He was also very demanding, worked long hours and expected a lot from people–and got it.” Sperlich left Chrysler in 1988, nearly a year before Withrow departed.
Other former Chrysler executives, who asked not to be named, agreed with Withrow and Murphy but were more caustic, saying: “He was too smart for his own good, very difficult to work with.” “Bob Lutz (Chrysler vice chairman and former president) and Sperlich served together, but they got along like oil and water. Both were strong-willed.”
Sperlich agrees, calling himself “headstrong and independently minded.”
Sperlich left Chrysler in February of 1988 as president. He thought funds should be used to develop future products, especially the now successful LH cars.
Iacocca went for diversification, such as Gulf Stream, an airplane manufacturer; a savings and loan; a Texas defense contractor; and a failure with the Maserati import.
Perhaps Sperlich was most vehemently opposed to the 1987 purchase of American Motors Corp., a success as it turns out because it brought Jeep, a leader in the booming sport-utility vehicle arena.
While mini-van annual sales reached more than a million and a quarter in 1995, they have tapered off. According to the American Automobile Manufacturers Association, more than 11 million domestic and foreign vans have been produced since Chrysler created the niche in 1984.
Sperlich was 59 when he left Chrysler, saying he planned to retire at 60 anyway to get rid of the strain of big business. He wanted to devote more time to his wife, Polly, their seven children and their grandchildren.
Today, at 67, however, he is the chairman of Delco Remy America Corp. of Anderson, Ind., a producer of electrical components and alternators for the auto industry. He took the job Aug. 1, 1994.
He commutes the roughly 270 miles between Anderson and Detroit and is in charge of some 1,500 employees of the former General Motors Corp. facility.
