So what's former Chrysler Corp. president and chairman Lee Iacocca doing on the Internet? He's hawking used industrial equipment--about $7 billion worth.
The brash, outspoken and unorthodox executive who helped revolutionize the U.S. auto industry by overseeing the development of the Ford Mustang, and who later became a national celebrity by pulling Chrysler back from the brink and leading it to record profits, is now an Internet entrepreneur.
Iacocca, 75, recently joined the board of directors of Online Asset Exchange, San Diego. The company, founded by Frank Berlage, provides Internet advertisements for machine shops looking to unload used machinery and equipment.
It may be just another b-to-b trading exchange, but Iacocca's presence has already set it apart. When it was announced on Feb. 7 that Iacocca had signed on as a board member and pitchman, the Web site was flooded with inquiries. Extra server capacity and bandwidth had to be added to handle the demand.
That's not to say Iacocca is guaranteed to give Online Asset Exchange the Midas touch. He has lent his name to lots of non-Internet ventures since his departure from Chrysler in 1992. Fast-food chicken chain Koo Koo Roo Inc., a casino in Branson, Mo., and a space-tour company haven't worked out. After years of development, E-bike, an electric bicycle developed under Iacocca's leadership, has finally gone on the market.
From his offices at EV Global Motors, where he presides over the E-bike, Iacocca explained his first foray into the new economy, complained about greed and compared cyberspace to his days in Detroit.
Q: Internet businesses have been sprouting for years now. What took you so long to get involved in a start-up?
A: I was getting an offer a week to do something Internet related, usually car or car parts related. They were all consumer sites. I really stayed away from many, many inquiries. Most wanted to use me to draw traffic. My visage--my mug--is recognized by people, for better or worse. I got a lot of offers, but didn't want to jump into cyberspace just yet.
Q: Why did you decide on Online Asset Exchange?
A: Berlage and his group had spent a couple of years getting it organized properly. With Berlage's company, it wasn't so much that they had found all the unused assets laying in warehouses and attics all over the world. They'd also come up with a complete package serving the buyers of these hand-me-downs. It wasn't so much that they'd bring the guy who needed to sell a boring mill or a $1 million milling machine to someone in China who might need it. It was that they provided appraisal, auction, escrow, financing and transportation services along with the listings.
Q: So are you saying services will separate the winners from the losers on the Net?
A: Yes. Every Internet company will find this out the hard way: Even though the electronic world has changed the way you do business, the customer must be handled expe
Q: Do you see any similarities between Online Asset Exchange and the auto business?
A: It reminds me of the biggest secondary market in the world, the used-car market. It used to be primitive. Then we got the Kelley Blue Book, so people knew what the hell these cars were worth. Then we got into auctions, which became huge. And then we got into moving used rental cars from Florida to Michigan, and so on. That market was mature and developed. I said, "My God, the machine tool business is not glamorous, but these guys are doing the same thing that's happened in used cars; They are putting some sense into the market."
Q: Are you involved in the day-to-day operations of Online Asset Exchange?
A: I won't be a figurehead in this stuff. I'm on the board. I'll go to some of the trade shows. I've talked with the agency at length and the PR group. I've given my input on the ads, what we're trying to get done here and who their real market is. If nothing else, I'm basically a marketing man. And that's where I've been most involved.
Q: Have you tailored any part of your bike company, EV Global Motors, to the Internet?
A: We sell some bikes on the Internet directly. The difficult problem is it's a new market. Few know what an electric bike is. Where you don't have a mature market, people want to go ride the bike and kick tires.
Q: If you were just coming out of college, would you take the same career path or a different one?
A: The world changes. The Internet is definitely a revolution. When I came out of school, it was right after the war. I was an automotive engineer. ... A lot of other people went into aircraft and automotive and the like. Now, there's a new electronically driven, high-technology industry--a natural for people coming out of college. But something bothers me, frankly.
Q: What's that?
A: So many young people want to go in and say, "I've trained to be a lawyer, but I'm on the phones now at $30,000 [a year] because I am going to get stock options." They look you right in the eye and say, "I'm going to be worth $100 million in three months." I wish life were that way for these young kids. With some of these Internet stocks, you better hedge your bets. In the car business between 1909 and 1919, there were 120 car companies trying to take on the Model T. I note with some alarm, there are two [major U.S.-based automakers] left in the car business. The guy who will win is the one who knows what a customer needs.
Q: Do you see parallels between Web business-to-business services and the automotive industry's efforts to streamline manufacturing processes?
A: We learned the hard way in the car business. We were great inventors and designers, but then you had to bring it to the masses and do something for them. The Japanese taught us a lot. The total process of an all-new car used to be five years. Now, it is 36 months. I think business-to-business Internet commerce is due for a similar sea change.
Q: You've often said you are fundamentally a marketer. Any advice for people running corporate marketing departments?
A: The money should be spent on brand and traffic. When I see some of the television advertisements, I wonder if I know anything about advertising anymore. I don't get them. It is subliminal, I guess. They got their name in front of me, and won a Clio award, but the hell with the basics.