Ex-Chrysler Chairman John Riccardo Dies

John Riccardo, the Chrysler Corp. chairman and CEO who hired Lee Iacocca in 1978 to help save the company, has died at age 91.

Riccardo passed away on Saturday after attending a Univ. of Michigan basketball game in Ann Arbor, Mich., Automotive News reports.

The soft-spoken accountant joined Chrysler in 1959 with a sharp eye for cost cutting that later earned him the nickname The Flamethrower. Already a protege of Chairman and CEO Lynn Townsend, he became general manager of Chrysler’s import-export unit a year after joining the company.

From there he moved rapidly through senior positions at Dodge, Chrysler-Plymouth and corporate marketing before becoming president in 1970. The company, which had just emerged from its latest restructuring, “will always be a boom-or-bust company," he opined at the time.

Riccardo succeeded Townsend five years later as chairman and CEO. Chrysler, like its domestic competitors, was struggling with a sharp shift in consumer demand for small cars in the wake of the 1973 oil embargo. As fuel prices eased, demand swung back to big cars, then reversed again when the 1978 energy crisis hit. The company’s debt ballooned to $4 billion.

By November 1978 he had coaxed Lee Iacocca, who had been fired at Ford Motor Co. in July, to become Chrysler’s president and chief operating officer. Iacocca immediately launched another restructuring.

A visibly worn Riccardo abruptly resigned in September 1979 after his urgent plea for federal aid to avoid a Chrysler bankruptcy was rejected by the U.S. Dept. of the Treasury. Iacocca took over in as chairman and CEO, leading a team that successfully negotiated $1.5 billion in federal loan guarantees in early 1980.