[Footsteps on gravel] [Car door slams] [Engine starts, car drives away] NARRATOR: By 1968, the slow, plain Volkswagen Beetle had managed to outsell the entire lineup of American Motors Corporation.

Narrator: Now, Japanese cars were also gaining ground in the U.S. market.

On a flight to Detroit that June, AMC's head of manufacturing, Gerald Meyers, discussed the need for an economical "import fighter" with Vice President of Styling, Richard Teague.

GERALD MEYERS: Dick Teague was an open-minded, upbeat, highly talented person.

He could sketch vehicles that you could look at and say "That's wonderful, that's exciting."

And yet, it could be built.

LISA TEAGUE-SCARPELLI: He was so desperate for a piece of paper that he saw this barf bag on the airplane, and he of course, had a pen with him.

[Pen scribbling] NARRATOR: Grabbing an empty motion-sickness bag, Teague sketched the front half of the upcoming AMC Hornet sedan, combined with the chopped rear end of a concept car called the AMX-GT.

The shape was practical, but unique.

Hoping the little car would cause lots of trouble for the imports, Teague named it.

the Gremlin.

[Bright roadtrip music] ANNOUNCER: Funding for The Last Independent Automaker was provided in part by... [Driving rhythmic music] WOMAN: We are Detroit.

And when we move, you move.

ANNOUNCER: Funding was also provided by...

The Alfred P. Sloan Foundation... MotorCities National Heritage Area... And also... For a complete list of funders, visit APTonline.org [Military drum music] NARRATOR: Despite building a military icon, by the late 60s, the Kaiser Jeep Corporation was struggling.

But Roy Chapin Jr., the Chairman and CEO of American Motors, had seen Jeep's popularity around the world, and it's potential at home.

WOMAN: Holy Toledo, what a car!

PATRICK FOSTER: He knew they could be selling more, because if you've got 1700 Jeep dealers, and then you add 3000 Rambler dealers selling Jeep, your Jeep sales in the United States are going to skyrocket.

He realized all that.

He had a hard time convincing anybody else.

NARRATOR: After Henry Kaiser's death, his family was eager to sell the stagnant Jeep operation.

Chapin sent Gerry Meyers to investigate its Toledo headquarters in 1969.

MEYERS: The first thing that struck me when I walked in was, how many people there were.

The assembly lines were just crowded with people.

A three-man job had ten men on it.

A two-man job had four men on it.

There were parts all over the place.

It was very inefficient.

And I went back to American Motors and I said, "Roy, I think it's a disaster.

You don't want anything to do with it.

It's inefficient.

It's archaic.

It's, it's absurd.

And my recommendation is to forget it."

Then they had a board meeting.

Roy came out, and he said, "Gerry, come into my office.

We're going to buy Jeep."

I said, "Roy, you've gotta be crazy."

He said, "I've got something else to tell you.

We're going to put you in charge of it.

And you're going to make it work."

[Laughs] NARRATOR: The two companies reached a deal that October.

[Driving bass music] NARRATOR: Already on strike, union workers at AMC's two Kenosha, Wisconsin plants were livid that management had asked for concessions, then spent 70 million buying Jeep.

[Crowd boos] JOHN DREW: American Motors had a lot of eggs in one basket.

We built the engines.

We made the stampings.

We had two final assembly lines.

So a strike by Local 72 could basically bankrupt American Motors.

Now, by the same token, bankrupting American Motors was not going to be such a great thing for us, either.

So there was a little bit of mutually assured destruction.

NARRATOR: The strike dragged on for a record 26 days.

But Roy Chapin had already bagged his prize.

VINCE GERACI: Thank God, Mr. Chapin that you prevailed.

Because that one decision, I say, is one of the most significant decisions in the automotive business.

[Elegant string music starts] NARRATOR: Quiet and patrician, the Yale-educated CEO stood in stark contrast to the company's gruff, profane, President, William Luneburg.

DEAN GREB: It couldn't have been uh dif- more different, I don't think.

Because uh, Chapin was very sophisticated and more of a uh, sales and marketing guy, and Luneburg was just a tough, hard-nosed manufacturing guy who didn't take any crap from anybody.

WILLIAM CHAPIN: My stepmother called them the odd couple, because Luneburg could go walk into a car plant, and knock heads, and Dad could go to the banks and say "We need another million bucks tonight."

And it worked.

NARRATOR: Promoted together in 1967, they had overhauled AMC's finances and image.

[Race car noises; fast-paced 60s rock music] JOSH GREENPLATE: I think a lot of the credit for that goes to Chapin for realizing that they needed to capture the baby boomer market, and the way to do that was with performance.

[Race car noises] NARRATOR: 1970 brought a deal with Penske Racing and legendary driver, Mark Donahue.

While new muscle cars lured buyers into showrooms... [Engine revs] NARRATOR: Prototypes were even made for a radical supercar called the AMX/3, before management pulled the plug.

TEAGUE-SCARPELLI: They had these grandiose plans, and it just couldn't get the wheels off the ground.

By the time the car would've been manufactured and made, it was just too expensive.

So they scrapped the project.

NARRATOR: Performance cars weren't practical for everyone.

Thankfully, new economy models were on the way.

[camera clicks] ROMAN WOJEIECHOWICZ: It seems like anything that happens in the United States, the trend is set by California.

And the thing was, it was cool to have a foreign car.

A little Toyota or Datsun.

So California is the trendsetter, and then it moves this way.

NARRATOR: Since 1950, foreign brands had snowballed from almost nothing, to over 10 percent of the market, primarily with small cars.

FOSTER: Imports became more popular because they became better cars.

Gradually, the Japanese and Volkswagen stood out and it was because the quality was just much better, and the Japanese cars were just nicer.

They were smaller, but all of a sudden, the Americans didn't care.

[Car speeds past] [Frantic string music plays] NARRATOR: AMC's share of the compact car market had slipped, but the attractive new 1970 Hornet would hopefully turn the tide.

NARRATOR: And, by sharing parts with future models, it would save American Motors millions in tooling costs.

FOSTER: Tooling is a broad term for the machines that build the parts of a car, and all of them are very expensive for different reasons.

The body dies have to be hand-carved out of extremely tough steel.

And the machinery, I mean these are huge presses that can exert a million pounds of pressure on a piece of steel.

That's expensive.

American Motors got around that with the Hornet because they were experts at cutting tooling costs and sharing parts better than anybody else.

NARRATOR: The next variation launched on April Fools Day, 1970.

COMMERCIAL NARRATOR: American Motors introduces: the Gremlin.

MAN 1: What is that?

MAN 2: A Gremlin!

MAN 1: Oh, move over!

MAN 2: Huh?

What are you doing?

MAN 1: Oh boy!

COMMERCIAL NARRATOR: It's smaller than any other car made in America, which makes it easier to park and handle.

MAN 3: Hey, wow!

What's that?

MEN: It's a Gremlin!

[All men excitedly talking, doors slamming] MAN 2: That's my car!

Wait!

COMMERCIAL NARRATOR: The Gremlin is priced with the imports, and it gets better gas mileage than any other car made in America.

MAN 4: What is this?

MEN: It's a Gremlin!

[All men excitedly talking, doors slamming] COMMERCIAL NARRATOR: And it just could be more fun to drive than any other car made in America.

MAN 4: What kind of car is this?

MAN 2: It used to be mine!

WOMAN: Harry!!

[Upbeat 70s music starts] NARRATOR: By sharing the Hornet platform, the Gremlin not only became the first American sub-compact car, but it cost just 6 million dollars to develop, versus the 200 million General Motors spent on the upcoming Chevy Vega.

GERACI: I think American Motors did extremely well.

Teague and the group were magicians in taking that design and modifying them and coming up with a completely different look.

BOB MONACELLI: Who'd ever dreamed you'd build a car like the Gremlin?

I mean, that was very, very unique.

You parked in a parking lot, it stood out!

NARRATOR: Its low price and quirky styling attracted thousands of new buyers.

Unfortunately, the cost of the Gremlin, Hornet, Jeep, and last year's strike landed American Motors in the red for 1970.

[Whistle of wind] NARRATOR: And trouble was brewing on the assembly line.

[Cajun music] BILLY AIELLO: People would say, never buy an American Motors car that was built on a Friday.

DANNY LAMANTIA: Because of absenteeism.

AIELLO: And drinking!

Across the street was Freddie's tavern.

They knew us all; we knew them.

They knew how many beers to set up.

You go down and drink your drinks, and they would bring your food to you, and you'd go back.

LAMANTIA: They had the police out there a lot of times, holding traffic up, so that a herd of people could get into these bars.

And I'm not one of those guys.

I'm not a drinker, I'm not one of those guys.

AIELLO: I was!

LAMANTIA: Even when they had topless women!

NARRATOR: Drinking and more recently, drug abuse, were affecting the quality of AMC cars.

FOSTER: You're building a consumer product.

Some guy out there is working his butt off to buy this thing, and you know, you're doing a sloppy job of it.

Not to mention the number of workers that were hurt, because they were drunk and they did something stupid.

NARRATOR: And the problem didn't stop at the plant gate.

PAUL ROSKRES: You'd go into the bathroom, it'd be 10:00 in the morning!

In there there'd be like a little fifth.

There might be beer cans and I thought, "Holy cow!

They're putting that stuff down?"

In the summertime, one guy, he would bring a cooler in.

He had pop lined up on the top, beer on the layer below.

[Rustling soda cans in ice] AIELLO: I ended up setting up a bar.

It was a parts table, and under the table there was a shelf.

And I was a floater.

So if they didn't need me, I was making drinks.

LAMANTIA: I know there was a lot of drinking.

But I never knew somebody had an open bar!

AIELLO: Well, it wasn't open.

It had a curtain around it.

[Laughs] BILLY: Yeah, it had a curtain.

NARRATOR: The vast majority did their jobs sober and without fuss.

But they were growing frustrated with those who didn't.

GEORGE KAUFFMAN: I came across a lot of it, because I was a steward for a while, but I finally got tired of trying to cover up for somebody else's screwups and whatnot.

LAMANTIA: I wish I had a nickel for every guy's job I did that came in drunk.

The boss would say, "Put him to bed and do his job."

[Soft engine noise] NARRATOR: In a rare moment of teamwork, Local 72 and AMC established the industry's first joint drug and alcohol recovery program in 1970.

DREW: We really worked closely with management, so that if somebody had an underlying alcohol and drug problem and they were willing to admit to that and enter into a treatment program, we were able to save their jobs.

NARRATOR: Still, many argued the union was too protective of bad employees.

AIELLO: Well they got to the point where there were just too many.

LAMANTIA: That's right.

They cut you a lot of slack, and once you went through that program, you'd come back and you got into it again, you had your chance, buddy.

You're gone.

NARRATOR: With more high-quality imports on the market, customers who found shoddy workmanship or even empty beer cans in their new AMCs were unlikely to buy another one.

[Distant train horn] NARRATOR: Back in Toledo, Gerry Meyers brought in Ford racing engineer, Roy Lunn, to modernize Jeep.

FOSTER: He was just appalled.

He said, "Yeah, what were- This is archaic stuff; this is ancient."

And they had to really redo the entire Jeep line.

NARRATOR: Both the factory and the vehicles were updated with scores of new AMC parts.

But the styling, stayed.

FOSTER: They considered making it look differently and then they realized you know, this is a legend.

We're not going to make it look different.

We're gonna make it look the same, but easier to build and a better vehicle, too.

[Engine noises] COMMERCIAL: This year, 9 million of you Americans will buy a car, probably from one of the three big car companies, without even considering American Motors.

Now thats's a shame!

NARRATOR: Meanwhile, the ad firm, Wells Rich Greene, helped American Motors launch a direct attack on GM, Ford, and Chrysler for 1971.

COMMERCIAL: If you had to compete with the three biggest car companies in America, what would you do?

NARRATOR: To answer that question, AMC replaced the old Rebel with the new Matador, combined the Javelin and AMX into one line with wild styling, and launched a new Hornet station wagon, the Sportabout.

Marketed heavily to women, it proved an instant hit, outselling the Javelin and Matador, combined.

NARRATOR: All this helped put AMC back in the black for 1971.

The big news for 1972 however, wasn't a car; it was a warranty.

[Keys jingling] FOSTER: The Buyer Protection Plan was the most clearly written automobile warranty there ever was.

Instead of having a big booklet with all the legal jargon in there that nobody understood, it told everybody, we're going to take care of it, period.

NARRATOR: Covering every part except tires for 12 months or 12,000 miles, it did wonders for AMC's reputation.

WILLIAM CHAPIN: It wasn't just a warranty that was in the glovebox; it was a whole reason to buy the car.

A salesman could immediately go into the Buyer Protection Plan and close the deal in a lot of cases.

NARRATOR: To back it up, Gerry Meyers oversaw hundreds of little quality improvements across AMC products.

It paid off when Popular Mechanics magazine declared: "The best put-together cars out of Detroit this year may come out of Wisconsin, that's where American Motors makes them."

NARRATOR: Things were on a roll, which left Wells Rich Greene blindsided when Chapin and Luneburg fired them for a larger ad firm.

But AMC was growing, and they wanted more.

[Cheerful music starts] NARRATOR: To keep buyers interested, marketing VP, Bill McNealy, spearheaded a series of designer interiors, including a Gucci Sportabout and Pierre Cardin Javelin.

For Gremlin, he chose the hottest in youth fashion: Levi's jeans.

TEAGUE-SCARPELLI: My father was saying to me, what is it about these Levi's?

Why are they so popular?

And I was telling him, "Oh Dad, we gotta have Levi's.

It was like a big deal!"

GERACI: They gave us uh cuttings of the materials that they used for trousers and all the jackets and everything.

Naturally, you can't put them in the vehicles because of flame retardants and wear and all the rest, but we wanted to capture the feel, the coloration, and the details associated with Levi itself.

And there was Lois Zolicker, who was the manager at the time of the interior studio.

She took a bunch home.

We washed them and washed them to get that look that we liked, a little bit of wear but nothing of any significance so it gives that nice, soft, you know feel.

NARRATOR: Geraci then found an automotive fabric supplier that could mimic the look, and the 1973 Levi's Gremlin became a sensation!

TV ANNOUNCER: Gremlin's all new Levi's blue denim interior trim option.

A youthful new look, and feel!

And it can't be bought at any other dealership.

Only Gremlin has it!

GERACI: When I ultimately went to Chrysler, they said, "You know, we really wanted to do the Levi interior also, but sales didn't know if they could sell as many and the dealers didn't know if it was going to be popular enough, and we didn't know about the pricing, and we didn't know about this and we didn't know-" That's the difference between American Motors and the rest of the industry!

[Car drives past quickly] NARRATOR: American Motors had become a loveable underdog, thanks to what Roy Chapin called, its "philosophy of difference."

DAVE PERRINE: AMC did more with less.

More people had more responsibility.

There was no pigeonholing going on.

If you could do it, and you had the capacity to do it, you did it.

And I didn't see that level of commitment and exchange of information and ideas, when I got little peeks into Chrysler or Ford or General Motors.

We had that a lot because we had to.

[Cars whizz past] NARRATOR: To meet the rising demand for AMC cars, the factory went on a hiring spree.

DREW: People came from all over to work at American Motors.

It's an opportunity that people don't get a lot in this country to work side by side, to connect as equals.

And realize that, they're here for the same reason, they've got the same hopes, the same dreams that I've got.

We're all getting paid the same.

[Water sprays] NARRATOR: Life in the plant forged friendships, over the pride and sometimes disdain for the often grueling work.

DAVE FURLIN: My first job was pretty hard.

I had to put the brake line on the front of the firewall.

When the car was coming down the line, you had to lean over and put two screws in while this thing's going this way.

Oh my legs were killing me for a month!

You think you're in good shape?

Yeah.

That place will wear you out real quick!

[Laughs] BETTY BROWN: I started out in the motor division, and I was pushing and pulling pistons.

You come out with them on a tray and you put 'em inside the engine.

It was hard work, heavy work.

And your hands hurt really bad.

I wanted to quit.

Then I got moved to a different department.

[Welder buzzing and crackling] ROSKRES: It was hot.

I was welding.

It's the middle of summer and you're bundled up because of the sparks.

And I'd be working like crazy just to get maybe a foot, a foot and half ahead, so that I could go run, take a drink of water.

So I finally, after about a half hour of working, I finally got the last weld, ducked underneath the welder, ran to the bubbler, got a drink of water, came back, started, because now I'm behind and I'm thirsty again!

CAROL ZARUCK: There was one job I did, it was an open door with no rubber around it, and that's very sharp.

So I put pads on the back of my legs, and then I'd sit on the edge of the car, and I had to lean in, and put in the dome light.

Everybody else that relieved me for ten minutes on my breaks, had to climb into the car.

And they were trying to figure out, "How did she get all this done and keep up with the line?"

[laughs] We all had our own little tricks how to do our jobs.

[Car drives away] NARRATOR: But for those who could endure, the money was worth it.

ANTHONY DAVIS: There was quite a few that had gone to college and came back.

Because, you know, the pay and the benefits.

You had guys with masters and associates degrees, and I'm working side by side with them, you know.

And I'm going like, man you guys got all this education and you're working here?

FURLIN: When I started in 1973, I was only making about three and a half bucks an hour, but coming from a job I was making a dollar ten, I thought I was making all kinds of money.

And then in '74 I bought a brand new car, a brand new Javelin AMX.

Paid cash.

3900 bucks!

NARRATOR: Once again, AMC's products had struck a chord with the market.

ANTHONY: My mother had ordered a Hornet.

Me and my father were able to follow it along the line as it was being assembled.

Whatever went into that vehicle, you know, I got to see.

My dad was a stickler for things being done right.

So yeah, when that car came through for mom, yeah he was on top of everything there.

[Driving, hurried, ticking music] NARRATOR: However, as sales climbed, pressure at the factory increased.

TOD OHNSTAD: One of the kind of continuing fights that the union had with the company was to make sure that the line was adequately manned.

Because it was not unheard of for the company, in order to, you know, try to get a few extra cars out, to jack the line speed up a little bit.

But we had access to a stopwatch to see how long it was taking the car to go from point A to point B. NARRATOR: Despite the conflict, not having enough cars to sell, was a far better problem than not being able to sell them.

[Racecar engine revs] [Upbeat Cajun music] NARRATOR: By the early 70s, driver's like Mark Donahue, George Follmer, Shirley Shahan, Wally Booth, and Amos Johnson were racking up wins for American Motors.

[Car races past] NARRATOR: And thousands more were racing AMCs, though not always legally.

[Car engines rev] FURLIN: My dad had that Javelin with a 401, and my buddy had a Z28 Camaro.

And every time I took my dad's car out, I whooped that Camaro's keister every night!

He was never a happy camper every time I beat him.

Ha!

It was too funny.

[Engines accelerate] NARRATOR: But America's muscle car obsession had growing consequences.

[Tires squeal] FOSTER: A lot of them were sold to a lot of young people.

And there were a lot of accidents and a lot of deaths and a lot of injuries.

And insurance companies had to pay on all that stuff.

And insurance companies began to jack up rates on muscle cars, and all of the sudden, teenagers and people in their young 20's couldn't afford the insurance.

They could afford the cars but they couldn't afford the insurance.

NARRATOR: This, combined with rising air pollution, led the government to intervene with new automotive safety and emissions laws.

JOHN DAVIS: I don't think most of us really recognized that there was anything wrong.

It was only when you saw these pictures looking down on LA where you could barely see the city through all the smog that you realized, that this really wasn't the way it was supposed to be.

NARRATOR: Everything from bumpers and lights to seatbelts and steering wheels were redesigned.

Engines were de-tuned to reduce toxic emissions, making muscle cars a lot less muscular.

[Engine starts and sputters] NARRATOR: But the real death blow came in 1973, when the Organization of the Petroleum Exporting Countries, or OPEC, hit the United States with an oil embargo in retaliation for its support of Israel.

FOSTER: One day everything is normal, and the next day, I can't get gas for my car.

And when I can, it's like five times the price it used to be.

There were long lines at gas stations, and sometimes somebody else would try to cut in.

There would be fistfights, real, fistfights in gas lines, and in a few cases guns were brought out and people were killed over a gallon of gas.

NARRATOR: Sales of big cars and powerful engines tumbled.

FOSTER: The average American car probably got somewhere around 12 or 13 miles per gallon of gas, which was pathetic when you think about it.

But there was no need to do better than that, because nobody ever asked for it.

Gas is 30 cents a gallon, who cares?

When all the sudden you couldn't get gas, then it mattered.

[Gas station bell rings] JEFF KENNEDY: I can remember we got a '74 Javelin-AMX come in, off the transport.

I checked it in.

401, 4-speed, Mellow Yellow.

Pretty well equipped car, really cool car.

And I prepped it and put it right out in front of the dealership, and the general manager came out and says, "Well that's a special order."

And I said to him, I says "Well why don't we ever order any like this?"

"Oh no one wants these anymore."

NARRATOR: '74 would be the final year for the Javelin, which couldn't pass the new bumper standards without a costly redesign.

The oil crisis only reinforced the decision.

It would also be the last year for the big Ambassador, a name dating back to 1927.

[Upbeat 70s music starts] NARRATOR: On the other hand, small cars were selling like crazy.

JEFF: The general public always had the impression that, you know, AMC had good fuel-efficient cars.

That goes back to the days of Rambler and even before that, Nash.

And that actually helped AMC sell a lot of Gremlins and Hornets.

NARRATOR: Ironically, American Motors no longer had the most efficient cars.

FOSTER: You know, the Gremlin can get 20 miles per gallon, you know, people were, "Wow that's really impressive!"

You know?

Nowadays it wouldn't be, but back then, yeah.

[Car whizzes by] NARRATOR: When the embargo ended in March, AMC found itself with record sales, while the Big Three were facing layoffs.

It seemed Roy Chapin's "philosophy of difference" had been right.

[Motor accelerates] NARRATOR: But with success, came risks.

FOSTER: By 1974, American Motors executives were cocky.

They thought they were geniuses and that everything they touched would turn to gold, and all of the sudden they had almost unlimited money that they could do whatever they wanted.

NARRATOR: The company went on a spending spree, building a new headquarters and diversifying the business.

NARRATOR: And while the Hornet and Gremlin were a success, import sales had also grown stronger than ever.

NARRATOR: But AMC had a radical new design in the works, unlike anything Japan, Germany, or Detroit had to offer, for better, or worse.

ANNOUNCER: The Complete Book of AMC Cars features a fully-illustrated history of American Motors vehicles, and is available online at MPT.org/Shop.

Or call the phone number on the screen.

To learn more about the cars and the people of American Motors, connect with The Last Independent Automaker online.

ANNOUNCER: Funding for The Last Independent Automaker was provided in part by... [Driving rhythmic music] WOMAN: We are Detroit.

And when we move, you move.

ANNOUNCER: Funding was also provided by...

The Alfred P. Sloan Foundation... MotorCities National Heritage Area... And also... For a complete list of funders, visit APTonline.org