Editing American Motors Corporation (section)

== Changing focus in the 1960s ==

=== Innovation ===
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To stay competitive, American Motors produced a wide range of products during the 1960s and added innovations long before the "Big Three" introduced them.

For example, the [[Rambler Classic]] was equipped with a standard tandem [[master cylinder]] in 1962 that provided stopping ability even if there was a failure in the brake system.<ref>{{cite book |url= https://books.google.com/books?id=CyBFAgAAQBAJ&pg=PA65 |pages=63–65|title=American Motors Corporation: The Rise and Fall of America's Last Independent Automaker|first=Patrick R. |last=Foster |isbn=978-0-7603-4425-5 |publisher=Motorbooks |year=2013 |via=Google Books |access-date=June 23, 2022}}</ref> Only [[Cadillac]] also included this safety feature six years before U.S. safety regulations required it on all cars.

Rambler also was an early pioneer in offering an automatic shift indicator sequence (P R N D2 D1 L, where if one selected "D2", the car started in second gear, while "1" began in first gear) on its "Flash-O-Matic" transmission which is similar to today's "PRNDSL" shift pattern, made mandatory for the 1968 model year cars,<ref>{{cite magazine |url= https://books.google.com/books?id=jSEDAAAAMBAJ&pg=PA82 |title=What the new auto safety laws will mean to you |page=82 |magazine=Popular Science |date=June 1967 |volume=190 |issue=6 |via=Google Books |access-date=June 23, 2022}}</ref> which required a neutral position between reverse and drive,<ref>{{cite web |url= https://books.google.com/books?id=p_k6AAAAIAAJ&pg=PA240 |page=240 |title=The Code of Federal Regulations of the United States of America |publisher=U.S. Government Printing Office |year= 1966 |via=Google Books |access-date=June 23, 2022}}</ref> while [[General Motors]] still offered a shift selector that had reverse immediately next to low gear (PNDSLR) well into the 1960s.

Unique in the U. S. automotive industry, American Motors offered adjustable front seat backrests from their Nash-origin,<ref>{{cite book |url= https://books.google.com/books?id=r9j7MWLE_jMC&dq=adjustable+seat+AMC+was+unique+in+thinking+it&pg=PA11 |page=11 |title=The Cars of American Motors: An Illustrated History |first=Marc |last=Cranswick |publisher=McFarland |year=2011 |isbn=978-0-7864-8570-3 |via=Google Books |access-date=June 23, 2022 |archive-date=April 9, 2023 |archive-url= https://web.archive.org/web/20230409193719/https://books.google.com/books?id=r9j7MWLE_jMC&dq=adjustable+seat+AMC+was+unique+in+thinking+it&pg=PA11 |url-status=live }}</ref> and in 1964, the Classic and Ambassador were equipped with standard dual reclining front seats nearly a decade before the Big Three offered them as options. [[Bendix Corporation|Bendix]] [[disc brake]]s were made standard on the Marlin and optional on other models in 1965.<ref>{{cite web |title=Introduction to the 1965–1967 AMC Marlin |url= https://auto.howstuffworks.com/1965-1967-amc-marlin.htm#pt2 |work=How Stuff Works |author=((Auto Editors of ''Consumer Guide'')) |date=October 26, 2007 |access-date=June 23, 2022 |archive-date=June 28, 2022 |archive-url= https://web.archive.org/web/20220628223822/https://auto.howstuffworks.com/1965-1967-amc-marlin.htm#pt2 |url-status=live }}</ref><ref>{{cite magazine |title=What's new at American Motors |magazine=Popular Science |volume=185 |issue=4 |pages=90–91 |date=October 1964 |url= https://books.google.com/books?id=1yUDAAAAMBAJ&pg=PA90 |via=Google Books |access-date=June 23, 2022}}</ref> This made the Marlin one of the first modern American cars with standard disc brakes, while the Big Three did not offer them until the early 1970s on most of their models to meet [[Federal Motor Vehicle Safety Standards]].<ref>{{cite web |url= http://www.secondchancegarage.com/public/history-of-automotive-brakes-1.cfm |title=Hitting the Brakes: A History of Automotive Brakes |first=Llewellyn |last=Hedgbeth |work=Second Chance Garage |access-date=June 23, 2022 |archive-date=February 24, 2013 |archive-url= https://web.archive.org/web/20130224033919/http://www.secondchancegarage.com/public/history-of-automotive-brakes-1.cfm |url-status=live }}</ref>

In the early part of the decade, sales were strong, thanks in no small part to the company's history of building small cars, which came into vogue in 1961.<ref name=Flory133>{{cite book|last=Flory Jr. |first=J. "Kelly" |title=American Cars, 1960–1972: Every Model, Year by Year |publisher=McFarland |year=2004 |page=133 |isbn=978-0-7864-1273-0}}</ref> In both 1960 and 1961, Ramblers ranked in third place among U. S. automobile sales,<ref>{{cite web |url= https://auto.howstuffworks.com/1965-1966-rambler-ambassador.htm#pt1 |title=1965–1966 Rambler Ambassador |work=How Stuff Works |author=((Auto Editors of ''Consumer Guide'')) |date=October 23, 2007 |access-date=June 23, 2022 |archive-date=June 25, 2022 |archive-url= https://web.archive.org/web/20220625144414/https://auto.howstuffworks.com/1965-1966-rambler-ambassador.htm#pt1 |url-status=live }}</ref> up from third on the strength of small-car sales, even in the face of a lot of new competition.<ref name=Flory133/> Romney's [[Strategic management|strategic focus]] was very successful, as reflected in the firm's healthy profits year after year. The company became completely debt-free. The financial success allowed the company to reach an agreement on August 26, 1961, with the [[United Auto Workers]] for a [[profit sharing]] plan that was new in the automobile industry. Its new three-year labor contract included generous annual improvement pay increases, and automatic cost-of-living raises.<ref>{{cite news |first=Damon |last=Stetson |title=American Motors And U.A.W. Agree To Share Profits |url= https://www.nytimes.com/1961/08/27/archives/american-motors-and-uaw-agree-to-share-profits-accord-reached-in.html |url-access=subscription |access-date=November 24, 2010 |newspaper=The New York Times |date=August 27, 1961 |page=1 |archive-date=August 27, 2021 |archive-url= https://web.archive.org/web/20210827004835/https://www.nytimes.com/1961/08/27/archives/american-motors-and-uaw-agree-to-share-profits-accord-reached-in.html |url-status=live }}</ref> However, in 1962, Romney resigned to run for Governor of [[Michigan]]. His replacement was [[Roy Abernethy]], American Motors' successful sales executive.

By 1964, Studebaker production in the United States had ended, and its Canadian operations ceased in 1966. The "Big Three", plus the smaller American Motors, [[Kaiser Jeep]], [[International Harvester]], [[Avanti cars (non-Studebaker)|Avanti]], and [[Checker Motors Corporation|Checker]] companies were the remaining North American auto manufacturers.

[[File:1965 Marlin aqua white md-rr.jpg|thumb|1965 Rambler Marlin]]
Abernethy believed that American Motors's reputation of building reliable, economical cars could translate into a new strategy that could follow AMC buyers as they traded into larger, more expensive vehicles. American Motors, in reality, had produced large cars throughout its history. The Rambler Ambassadors were as large as a full-sized Ford or Chevy. There was only an absence of largest-sized cars from the American Motors lineup in 1963 and 1964<ref>{{cite news |first=David R. |last=Jones |title=American Motors Putting Stress on Power and Luxury |newspaper=The New York Times |date=September 7, 1964 |page=6 |url= https://www.nytimes.com/1964/09/07/archives/american-motors-putting-stress-on-power-and-luxury-rambler-maker.html |url-access=subscription |access-date=August 8, 2010 |archive-date=July 22, 2018 |archive-url= https://web.archive.org/web/20180722190748/https://www.nytimes.com/1964/09/07/archives/american-motors-putting-stress-on-power-and-luxury-rambler-maker.html |url-status=live }}</ref> The first cars bearing his signature were the 1965 models.<ref>{{cite magazine|url= https://books.google.com/books?id=olEEAAAAMBAJ&q=1965+Rambler+Ambassador+sensible+spectaculars&pg=PA79 |title=Rambler Ambassador (advertisement) |pages=78–79 |magazine=Life |date=December 1964|volume=58 |issue=8 |via=Google Books |access-date=June 23, 2022}}</ref> The 1965 models were a major makeover of the new platform that had just been introduced in 1963. These were a longer [[AMC Ambassador|Ambassador]] series and new [[convertible]]s for the larger models. During mid-year, a [[fastback]], called the [[Rambler Marlin|Marlin]], was added.<ref>{{cite web |work=How Stuff Works |author=((Auto Editors of ''Consumer Guide'')) |title=Introduction to the 1965-1967 AMC Marlin |url= https://auto.howstuffworks.com/1965-1967-amc-marlin.htm |date=October 26, 2007 |access-date=June 23, 2022 |archive-date=June 28, 2022 |archive-url= https://web.archive.org/web/20220628223822/https://auto.howstuffworks.com/1965-1967-amc-marlin.htm |url-status=live }}</ref> It competed directly with cars like the [[Dodge Charger (1966)|Dodge Charger]], but AMC's "family-sized" fastback emphasized [[Personal luxury car|personal-luxury]].<ref>{{cite web |last1=Wilcox |first1=Lee |title=Curbside Classic: 1967 Dodge Charger – Chrysler's Marlin |url= https://www.curbsideclassic.com/curbside-classics-american/curbside-classic-1967-dodge-charger-a-chrysler-marlin/ |work=Curbside Classic |date=June 7, 2022 |access-date=June 23, 2022 |archive-date=June 21, 2022 |archive-url= https://web.archive.org/web/20220621203345/https://www.curbsideclassic.com/curbside-classics-american/curbside-classic-1967-dodge-charger-a-chrysler-marlin/ |url-status=live }}</ref>

=== Tough choices ===
The continuing quest "in the business world's toughest race – the grinding contest against the Big Three automobile makers" also meant annual styling changes requiring large expenditures.<ref>{{cite news |first=Vartaing G. |last=Vartan |title=Rambler Chief Is Fighting 'Big 3'; Roy Abernethy Says American Pushes Hard Battle |url= https://www.nytimes.com/1964/03/20/archives/rambler-chief-is-fighting-big-3-roy-abernethy-says-american-pushes.html |url-access=subscription |access-date=August 8, 2010 |newspaper=The New York Times |date=March 20, 1964 |page=45 |archive-date=July 22, 2018 |archive-url= https://web.archive.org/web/20180722192129/https://www.nytimes.com/1964/03/20/archives/rambler-chief-is-fighting-big-3-roy-abernethy-says-american-pushes.html |url-status=live }}</ref> American Motors's management total confidence "that the new 1965 models would stem a bothersome decline" actually began falling behind in share of sales.<ref>{{cite news |first=David A. |last=Jones |title=Rambler Facing Eroding Market |url= https://www.nytimes.com/1965/07/25/archives/rambler-facing-eroding-market-american-motors-is-falling-behind-in.html |url-access=subscription |access-date=August 8, 2010 |newspaper=The new York Times |date=July 25, 1965 |page=F1 |archive-date=August 29, 2018 |archive-url= https://web.archive.org/web/20180829080836/https://www.nytimes.com/1965/07/25/archives/rambler-facing-eroding-market-american-motors-is-falling-behind-in.html |url-status=live }}</ref>

Moreover, a new line of redesigned cars in the [[Full-size car|full]] and [[Mid-size car|mid-sized]] markets was launched in the fall of 1966.<ref>{{cite news |title=American Motors Is Counting on Sleekly Styled Cars |url= https://www.nytimes.com/1966/09/22/archives/american-motors-is-counting-on-sleekly-styled-cars.html |url-access=subscription |access-date=August 8, 2010 |newspaper=The New York Times |date=September 22, 1966 |page=43 |archive-date=August 28, 2018 |archive-url= https://web.archive.org/web/20180828172033/https://www.nytimes.com/1966/09/22/archives/american-motors-is-counting-on-sleekly-styled-cars.html |url-status=live }}</ref> The cars won acclaim for their fluid styling, and Abernethy's ideas did work as Ambassador sales increased significantly. However, the dated designs of the Rambler Americans hurt its sales, which offset gains from Ambassador sales. There were quality control problems with introducing the new full-sized cars and persistent rumors of the company's demise because of its precarious cash flow. [[Consumer Reports]]' negative ratings for American Motors' safety did not help.

During this time, AMC's international sales were expanding. From only 18,000 cars five years ago, the 1965 model year AMC sold 74,420 vehicles in Canada, Europe, and Latin America. AMC remained the most significant U.S. seller of autos in both France and Germany.<ref>{{cite magazine |title=American Motors |magazine=Forbes |date=1966 |volume=98 |page=34 |url= https://books.google.com/books?id=KA-8AAAAIAAJ&q=AMC+remains+the+biggest+U.S.+seller+of+autos+in+both+France+and+Germany |via=Google Books |access-date=June 23, 2022}}</ref>

Abernethy also called for the de-emphasis of the Rambler brand because he believed the public associated it too strongly with economy cars and that it was hindering the sale of American Motors' other models at a time when mid and luxury car sales were robust. As a result, he ordered that for 1966, the Ambassador and Marlin were to be badged purely as a product of American Motors.<ref>{{cite web |title=Ambassador: 1965-1966 |work=The Auto History Preservation Society |url= http://wildaboutcarsonline.com/cgi-bin/pub9990262549620.cgi?itemid=9990287407543&categoryid=9990287330870 |access-date=June 23, 2022 |archive-date=August 17, 2022 |archive-url= https://web.archive.org/web/20220817033504/http://wildaboutcarsonline.com/cgi-bin/pub9990262549620.cgi?itemid=9990287407543&categoryid=9990287330870 |url-status=dead }}</ref> The strategy shift at first seemed to be working because sales of the redesigned 1965 and 1966 Ambassadors improved, even as AMC's overall production decreased from the record level achieved in 1963.<ref>Total cars made by AMC in 1963 = 464,126, of which 37,811 were Ambassadors of a new design, but the same size as the [[Rambler Classic]] models. Total cars made by AMC in 1965 = 391,366, of which 61,145 were the first Ambassadors with new and larger "Abernethy" design. Source: {{cite book |editor-last=Gunnell |editor-first=John |title=The Standard Catalog of American Cars 1946-1975 |publisher=Krause Publications |year=1987 |isbn=978-0-87341-096-0 }}</ref> However, corporate earnings per share were a meager 27 cents per share, the lowest since AMC made its famous compact car comeback in 1958.<ref>{{cite magazine|title=American Motors |magazine=Forbes |year=1966 |volume=97 |url= https://books.google.com/books?id=4A28AAAAIAAJ&q=Abernethy+switched+advertising+agencies+to+promote+a+better+luxury+and+sports+car+image |page=118 |last1=Forbes |first1=Bertie Charles |via=Google Books |access-date=June 23, 2022}}</ref> Investors received a message of the changing fortune of the automaker when the company's 1966 annual financial report was delivered in a plain brown wrapper, instead of the previous year's glossy cover.<ref>{{cite book |last=Mueller |first=Mike |title=Motor City Muscle: The High-Powered History of the American Muscle Car |publisher=MBI Publishing |year=1997 |page=99 |isbn=978-0-7603-0196-8}}</ref>

[[File:American Motors-1967.svg|thumb|left|150px|American Motors logo used from 1967 until 1970]]
A completely new design was also slated for the larger 1967 models. This strategy added $60 million in retooling costs, a significant stretch for the company. The latest models shared fewer parts and were more expensive to build. Abernethy continued his objective to position the new [[Rambler Rebel|Rebel]] and Ambassador designs on an equal basis with competitive [[Economy car|economy models]] marketed by the Big Three.

[[File:1967 Ambassador 990 4-d aqua pa-s.jpg|thumb|1967 Ambassador 990]]
American Motors did not have their own electric car program as did the Big Three, and after some negotiation, a contract was drawn in 1967 with Gulton Industries to develop a new battery based on [[Lithium battery|lithium]] and a speed controller designed by Victor Wouk.<ref name=Wouk>{{cite journal |url= http://calteches.library.caltech.edu/4118/1/Hybrid.pdf |first=Judith R. |last=Goodstein |author-link=Judith R. Goodstein |year=2004 |title=Godfather of the Hybrid |journal=Engineering & Science |publisher=California Institute of Technology |volume=LXVII |issue=3 |access-date=June 23, 2022 |archive-date=December 2, 2013 |archive-url= https://web.archive.org/web/20131202235245/http://calteches.library.caltech.edu/4118/1/Hybrid.pdf |url-status=live }}</ref> A nickel-cadmium battery powered 1969 Rambler station wagon demonstrated the power systems that according to the scientist was a "wonderful car".<ref name=Wouk/> This was also the start of other "plug-in"-type experimental American Motors vehicles developed with Gulton – the [[Amitron]] city concept car and later the similar [[AMC Electron|Electron]].

Although the new models were well received by the motor industry media, the last quarter sales for AMC ended September 30, 1966 (AMC was not on a calendar fiscal year) were disappointing. The company recorded a balance sheet loss of $12,648,000 for the year before Tax Credits and deferred Tax Assets.<ref>{{cite journal| journal=Automobile Quarterly |volume=33 |issue=2 |page=36 | title=Rambler |date=November 1994 |url= https://books.google.com/books?id=BkBWAAAAMAAJ&q=Tom+McCahill+seemed+to+surprise+even+himself+when+he+flatly+stated+Rambler+Rebel |via=Google Books |access-date=June 23, 2022}}</ref><ref>{{cite magazine|url= https://books.google.com/books?id=GlYEAAAAMBAJ&q=There+isn't%20a+better+intermediate+size+car+sold+in+the+United+States+than+the+1967+Rambler+Rebel&pg=PA16 |magazine=Life |title=There isn't a better intermediate size car sold in the United States than the 1967 Rambler Rebel (advertisement) |page=16 |volume=62 |issue=17 |date=April 28, 1967 |access-date=January 1, 2012 |via=Google Books}}</ref> By this time the board had lost confidence in Abernethy due to his vast spending which had unstabilized the company and each year under his leadership the company had suffered substantial financial losses. As a result, Abernethy was forced into taking an "early retirement" from American Motors on January 9, 1967. Abernethy was replaced by [[Roy D. Chapin Jr.]] (son of Hudson Motors founder [[Roy D. Chapin]]).<ref>{{cite news |title=American Motors Picks Chapin For Chief as 2 Men Step Down; Evans and Abernethy Drop Out of Management Team Luneburg Is President |url= https://www.nytimes.com/1967/01/10/archives/american-motors-picks-chapin-for-chief-as-2-men-step-down-evans-and.html |url-access=subscription |access-date=August 8, 2010 |newspaper=The New York Times |date=January 10, 1967 |page=53 |archive-date=August 28, 2018 |archive-url= https://web.archive.org/web/20180828170713/https://www.nytimes.com/1967/01/10/archives/american-motors-picks-chapin-for-chief-as-2-men-step-down-evans-and.html |url-status=live }}</ref> Chapin quickly instituted changes to American Motors's offerings and tried to regain market share by focusing on younger demographic markets.<ref>{{cite news |first=Paul |last=Hofmann |title=A Younger Management At Rambler Maker; Rambler Maker Accenting Youth |url= https://www.nytimes.com/1967/01/11/archives/a-younger-management-at-rambler-maker-rambler-maker-accenting-youth.html |url-access=subscription |access-date=August 8, 2010 |newspaper=The New York Times |date=January 11, 1967 |page=65 |archive-date=August 28, 2018 |archive-url= https://web.archive.org/web/20180828174148/https://www.nytimes.com/1967/01/11/archives/a-younger-management-at-rambler-maker-rambler-maker-accenting-youth.html |url-status=live }}</ref> Chapin's first decision was to cut the price of the Rambler to within $200 of the basic [[Volkswagen Beetle]]. Innovative marketing ideas included making [[air conditioning]] standard on all 1968 Ambassador models (available as a delete option). This made American Motors the first U.S. automaker to make air conditioning standard equipment on a line of cars, preceding even luxury makes such as [[Lincoln (automobile)|Lincoln]], [[Imperial (automobile)|Imperial]], and [[Cadillac]].

[[File:1969 AMC AMX Big Bad Green at 2009 Potomac Ramblers meet 1of3.jpg|thumb|1969 American Motors AMX]]

The company introduced exciting entries for the decade's [[muscle car]] boom, most notably the [[AMC AMX|AMX]]. At the same time, the [[AMC Javelin|Javelin]] served as the company's entrant into the sporty [[pony car]] market created by the [[Plymouth Barracuda]] and the [[Ford Mustang]]. Additional operating cash was derived in 1968 through the sale of [[Kelvinator]] Appliance, once one of the firm's core operating units. The Kelvinator divestiture left American Motors a downsized company solely manufacturing automobiles.

The Rambler marque was discontinued for the larger 1968 domestic models, leaving only the small Rambler American as the last product to bear the name through 1969. The Rambler brand continued to be used only for export markets, with [[Mexico]] being the last market to use it in 1983. From 1970, American Motors was the brand used for all American Motors passenger cars, and all vehicles from that date bore the American Motors name and the new corporate logo. However, "American Motors" and "AMC" were used interchangeably in corporate literature well into the 1980s. The branding issue was further complicated when the company's [[AMC Eagle|Eagle]] [[four-wheel drive|all-wheel drive]] passenger cars were marketed as the American Eagle in the 1980s.