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LEE IACOCCA RETURNS TO PITCH CHRYSLER

Humorous Ads Touting Incentive Plan Could Begin Airing Tonight

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DETROIT (AdAge.com) -- Lee Iacocca will be pitching Chrysler group vehicles again.
Lee Iacocca and Chrysler remain in talks about his return as pitchman.
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The former Chrysler Corp. chairman will appear in a series of TV commercials touting the "Employee Pricing Plus" incentive campaign launched by the Chrysler group, the U.S. arm of DaimlerChrysler.

A deal between the automaker and Iacocca was finalized this afternoon, said George Murphy, Chrysler's senior vice president for global brand marketing. That was almost 24 hours after the news broke that Mr. Iacocca would be in ads for Chrysler.

Contribution to Iacocca Foundation
The main holdup to sealing the deal was legal wording, Mr. Murphy said today. Since Mr. Iacocca would not accept personal payment for the ads, the deal had to be legally set up so that a contribution would be made to the Iacocca Foundation, which supports diabetes research. The Chrysler group also will donate $1 for each vehicle sold in July to the Foundation. Mr. Iacocca's first wife, Mary, died from complications of diabetes in 1983.

"We started seriously negotiating last Friday so it's been very fast," Mr. Murphy said.

The first commercial, which also features actor Jason Alexander, will run either today or tomorrow, Mr. Murphy said.

Revives memorable line
In the commercial, Iacocca revives the most memorable line from his popular commercials of the early 1980s: "If you can find a better car, buy it."

The campaign marks the end of a years-long estrangement between Iacocca and the automaker he helped pull back from the brink of collapse in the early 1980s. Mr. Iacocca's reputation was tarnished in 1995 when he backed an unsuccessful takeover bid by billionaire investor Kirk Kerkorian.

Chrysler group and its dealers will spend about $75 million in July to advertise the Employee Pricing Plus program, which runs through Aug. 1, said Murphy.

Ad budget goes up 30%
The advertising budget will be about 30% higher than normal for a summer clear-out month, Murphy said.

The decision to approach Mr. Iacocca was an attempt to "break through the clutter" after General Motors Corp. initiated its "Employee Discount for Everyone" program in June, reaping a 46.9% U.S. sales increase.

Jason Vines, Chrysler group vice president for communications, said he approached Mr. Iaccoca on July 1 with the idea and "he liked it." Ads were filmed in New York on on July 5.

Chrysler had hoped to announce the deal at a news conference in Detroit yesterday, but Mr. Vines said then that attorneys were still reviewing contracts.

Mr. Murphy said Mr. Iacocca will appear in three or four TV spots. They will have a humorous tone, he said, and will emphasize product quality before mentioning the deal.

A Big Three incentives battle?
Gary Dilts, Chrysler group senior vice president for sales, disputed the notion that the three domestic automakers will battle each other with employee discounts. GM has extended its promotion to Aug. 1. Rival Ford Motor Co. has launched a similar incentive program. Research shows those who intend on purchasing import vehicles are interested in the deals, Mr. Dilts said.

Chrysler's deal offers employee discount prices, plus cash back ranging from $500 to $3,500, on most of the Chrysler group's 2005 model vehicles. Excluded are the hot-selling 2005 Chrysler 300, the Dodge Magnum, Viper and Sprinter van, the Jeep Liberty diesel, all SRT models and all 2006 models.

Chrysler group CEO Dieter Zetsche approved the use of Mr. Iacocca in the commercials, and DaimlerChrysler CEO Juergen Schrempp was told of the plan.

Mellowing relations
"It was a Chrysler group decision," Mr. Vines said. Relations between Mr. Iacocca and Chrysler -- once so bad that the automaker abandoned plans to name its Auburn Hills, Mich., headquarters building after him -- have mellowed in recent years.

"Lee drives our products," Mr. Vines said. "He has reached out to Dieter. He has written letters to him."

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Dale Jewett and Jamie LaReau are reporters for Advertising Age sibling Automotive News.

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