Bold School: The Story of AMC
When I think of the American Motors Corporation two things come to mind. One is the very first car I ever owned: a 1967 Rambler wagon that I bought for the princely sum of $200.00. The other is the image of Rocky Balboa running up the steps of the Philadelphia Museum of Art in the first film from 1976. Each represent the spirit of the enigmatic company that challenged Detroit’s Big 3 for over 30 years. AMC formed in 1954, when Nash-Kelvinator merged with the Hudson Motor Car Company. It was the largest merger between two firms up to that point in American history, and it laid down the gauntlet in front of older, more established car builders. Movers and shakers from both Motor City and Wall Street took a wait-and-see attitude towards the young upstart, wondering how long it would last. The company struggled at first to get a feel for the public’s taste in automobiles. But by 1958 it found a winner in its Rambler line. Led by George Romney (father of Mitt), AMC carved out a profitable niche among buyers looking for a well-built, affordable vehicle. In 1963 Motor Trend named the Rambler its car of the year, and American Motors Corporation seemed to have a bright future ahead of it.
Then Romney left in 1962 to govern the state of Michigan, and Roy Abernethy took his old job. The new head of the company decided that AMC could best compete with the Big 3 by trying to copy them. Abandoning Romney’s philosophy that emphasized doing a few things well, Abernethy tried to make American Motors into a firm that did hundreds of things all at once.
It was one of the classic bad decisions in business history. Put simply, AMC went broke trying to beat Detroit at its own game. On March 9, 1987, Chrysler bought what was left of AMC for $1.5 billion, and a once-great chapter in automotive history came to an end.
There’s a lesson here for anyone who seeks to achieve greatness: figure out what you do well and then do it. That simple piece of advice saved Apple when it was on the verge of folding in the 1990s. It might have saved AMC as well, but this real-life version of Rocky didn’t have Burgess Meredith to guide it. At least I’ll always have my Rambler.
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