Wine Lunches, Oil Leaks And 36-Hour Work Weeks: Inside AMC And Renault’s Weird Marriage

When I started producing a documentary series about the history of American Motors Corporation, I thought I knew the story pretty well. I’ve been an AMC nut since high school, I’ve been making videos about them for a decade, and my co-producer is the definitive expert on the company’s history. However, as I progressed through interviews with over three dozen former AMC employees, my internal construct of the company became cloudier, not clearer. The more I heard, the more I realized just how nuanced history can be. Of all the questions I asked, perhaps none received a wider variety of answers than this one: “What was it like working with Renault?”

Some adored the French, others hated them. Most felt something in the middle. But no two people gave the exact same response.

The French Connection

For those who don’t know, toward the end of its existence, The Last Independent Automaker American Motors Corporation (which eventually became part of what is now Stellantis) entered into a partnership with French carmaker Renault in 1978. This move was tied to the way the car market was shifting at the time over gas prices and fuel economy regulations. 

Several years ago I interviewed Gerald C. Meyers, the AMC CEO who architected the deal.

“American Motors had been known for high fuel economy,” Meyers told me. “But we were not the fuel economy winners at that time. And we thought that one quick way to get onto the new wave, because of the price of fuel, would be to get to smaller vehicles, and get them quickly. And that’s the reason I went over to France, and made an offer to Renault.”

By the late ‘70s, AMC’s product lineup had become increasingly outdated, and customers were flocking to smaller, fuel-efficient cars from Japanese, European, and even other American competitors. At that point, AMC didn’t even have its own four-cylinder engine, let alone a modern FWD compact car. It desperately needed new, competitive vehicles.

The partnership seemed like a win for everyone. AMC would gain access to Renault’s technology to design and build new cars in the U.S., and Renault would gain access to AMC’s wide-reaching dealer network and North American manufacturing operations. The two companies made sure to emphasize that the operation would be a partnership, not a merger; no stock would change hands. The deal was signed in January 1979. 

American Motors had done business in other countries before, but never at this scale. Management reached out to the Chrysler Corporation, which had previous overseas experience from their acquisition of the French automaker, Simca. Although its European division had recently collapsed, Chrysler still provided useful advice for setting up an in-house communication and translation department.

American Motors put great emphasis on having its people learn the French language and culture, with multiple teachers holding classes at the company headquarters during lunch hours and after work.

Pam Huegli had recently graduated college with a degree in French, and her former college professor, Don Iodice, hired her to help write a French textbook for Chrysler employees. As that project came to an end, Pam found herself taking a factory job to make ends meet. But before long, her friend called again, now with an offer to teach French at AMC.

“I was working at GM at the time in the truck and bus plant here in Pontiac,” she explained. “I was really worried about leaving GM and going to an unknown, American Motors. But I got a raise, and I started the first of February, 1980, and it was the best thing that ever happened in my life.”

She took her job seriously, even assigning homework. A wide range of students attended, from upper management down to lower positions, meaning some nervous employees had to share a classroom with Meyers, their CEO.

“I never really wanted to teach,” Pam told me, saying the school setting didn’t appeal to her. “But it was great because I didn’t have to teach children this way. I just had to teach adults who acted like children sometimes.”

VP of Engineering (and father of the AMC Eagle) Roy Lunn, insisted on private tutoring where he couldn’t be embarrassed in front of his coworkers. At the end of the course, she prepared an elaborate French dinner for her students, complete with quiche, beef bourguignon, and even escargot. The catch: they could only speak in French during the entire meal.

Wheels and Deals

Prior to the partnership, Renault already had a tiny presence in the U.S., selling around 13,000 cars a year. As quickly as possible, AMC began importing and distributing French-made Renaults through its own dealers, including the sub-subcompact Renault LeCar and the Renault 18i sedan/wagon. The sporty Renault Fuego would soon follow.

Frank Pascoe, a clay modeler in AMC’s design department, was part of a group tasked with “Americanizing” the cars.

“It was a lot of work,” he told me. “With doing front ends, making the bumpers, you know, so that they would work with American crash and safety things.”

Despite the team’s reservations, they weren’t able to make many changes to the cars beyond the bare minimum required to pass U.S. regulations.

“There were some styling issues,” Pascoe said with a smile. “I can remember the LeCar when it first came over here, it only had three lug nuts in the wheels, and the first thing that people said was, ‘You’ll never sell that car here!’ Americans want to have more than three lug nuts. It has to be at least four, right?”

However, having any new product to sell was good news for dealers, especially if it got good gas mileage. With a second oil crisis in 1979, sales of AMC’s Jeep division (by now, the company’s major breadwinner) tanked almost overnight.

Despite emphasizing the platonic nature of the partnership, Renault and AMC management soon found themselves in a tight situation. The companies had agreed to build a new subcompact car together in America, and AMC had already begun work on a line of downsized Jeeps that would eventually become the XJ Cherokee and Wagoneer. But with American Motors losing more cash by the second, it would be bankrupt before any of these vehicles saw the light of day. Both projects required hundreds of millions of dollars for vehicle design and engineering, plus retooling AMC’s badly outdated factories.

Since Renault was a nationalized company, it was partially owned and controlled by the French government. It also meant the government would likely provide nearly limitless funds to support Renault in an emergency. Not wanting its new business partner to die, in late 1979, Renault gave AMC a capital infusion in return for a 22.5 percent share of the company. As the U.S. economy continued to sour, Renault coughed up even more cash, and its stake in AMC increased to 46.4 percent by the end of 1980.

But like any deal, this one had its strings. Soon, French names began showing up on AMC’s board of directors, and the relationship suddenly went from “just friends” to “it’s complicated.”

Culture Clash

As the two companies became more intertwined, Pam’s teaching job expanded to include translating. Thousands of documents needed conversion from French to English and back again. Engineering reports, blueprints, marketing research, corporate memos… everything went through her new department.

“We had four translators working, and we each had a Radio Shack computer,” Pam remembered. “And that was the era of the Wang word pressor; everybody had Wang computers and thought they were great. Well, we didn’t, because we had to have a Radio Shack computer to do what we did.”

Radio Shack computers offered more flexibility, but in the early 1980s, translation programs of any kind were still uncommon. AMC’s translation software came from an unlikely source: The Church of Jesus Christ of the Latter-day Saints.

“They have their young people go out on missionary trips,” Pam explained, “And they always send them to different countries. They used this software, I guess, for them to be able to communicate and find out words in other languages. So we said, ‘Hey, that’s great! That software might work for us.’”

The program still required all the words to be loaded in manually, so the staff spent hours entering words before all the terms could be printed into an automotive glossary for employees. I had the chance to flip through the older glossary that she developed at Chrysler, and was amazed to find an entire page devoted just to clutch-related vocabulary.

Over time, more Renault representatives came to AMC’s headquarters. While most were happy to collaborate, a few AMC-ers were suspicious of the new blood. Clay sculptor Pascoe could speak the language, and his bosses weren’t above using his skills to their advantage.

“One of the managers approached me one day and said… ‘When these guys come in, hang out in the corner there and listen to what they’re saying, and let us know afterward if what they’re saying is really what they told us.’ So I was sort of hiding behind the plant in the corner you know, with my ear to the wall!” Frank laughed. “But basically we didn’t really learn anything. They were mostly telling us the truth.”

Not every interaction proved so innocent. To protect its investment, Renault began installing its own leaders, and sometimes their way of “doing business” raised a few eyebrows in Detroit. Longtime employees noticed a sudden increase of pretty young secretaries, all of whom seemed to work for Renault executives. Men with families back in France were occasionally seen out at fancy restaurants having very intimate dinners with American women. One employee we interviewed even said a manager tried to put the moves on her as they went through an automatic car wash. While most of this behavior was rare, it certainly stood out at old, conservative AMC.

Friction began to rise as Renault moved to de-emphasize AMC-branded passenger cars and focus only on Renault and Jeep products. New French management didn’t see much of a future in the tired old AMC Concord, Eagle, and Spirit models, and some even wanted the highly-successful Jeep division to play second fiddle to the Renault new cars. Many long-term AMC-ers resented this and dragged their feet to implement the changes. The Americans didn’t like being told what to do, even if the French were the ones paying to keep the lights on. Something had to give.

 “When Renault not only bought our company, but they decided to run our company, that was too much for me,” Meyers admitted, candidly. “By that time my ego had gotten overcharged, and I felt if I can’t run this company, I’d better ought to leave it. And I did.”

In a surprise move, Meyers left AMC in January of 1982. A combination of American and French executives got promoted in his wake, including a man named Jose Dedeurwaerder that was appointed President and COO. It became increasingly clear just exactly who was the dominant partner in this relationship. Shortly after Meyers’ departure, marketing VP Joe Cappy—a former Ford man hired by the new Renault management—announced that all AMC-branded products would eventually be phased out.

Le Cars

Unfortunately, Renault products weren’t doing so well in the U.S. market. 

The tiny LeCar obviously had limited appeal, but the Renault 18 sedan should have been successful and wasn’t. The 1982 Renault Fuego looked more promising; It was stylish, sporty, reasonably quick (when equipped with a turbo), and decently priced. During a MotorWeek review, John Davis even called it “The most appetizing bargain to reach our shores since nouvelle cuisine.”

Sadly, the Fuego also turned out to be a reliability nightmare. Electrical issues plagued the cars. Fuegos would break down, refuse to start, and randomly stall while driving on the highway. The car’s name, which means “fire” in Spanish, proved to be particularly ironic, as one AMC stylist told me he watched a coworker’s Fuego spontaneously combust in the company parking lot after the fuel injection system sprayed raw gas on top of the engine block.

To make matters worse, Renault’s management initially refused to believe there were any problems. They couldn’t understand why Americans didn’t love their cars. Finally, a sales manager put it rather bluntly why they weren’t selling, telling Jose Dedeurwaerder: “The Fuego is the most attractive car sitting dead on the shoulder of all the highways.”

American cars of the 1980s didn’t exactly have a reputation for impeccable quality, but European cars did carry a certain cachet with buyers. Unfortunately, Renault burned through that goodwill rather quickly. It seemed their cars weren’t quite suited to the rigors of the American highway—one of many areas that helped powerful, Autobahn-friendly German cars rise to luxury dominance.

“One of their favorite expressions that I heard was, ‘In France, we have no problem,’” said AMC engineer Dave Perrine. “They’ve got their driving culture over there, and driving habits there are a lot different than here in the U.S. They relied a lot on mass transportation. They were really surprised at our lack of mass transportation here.”

American drivers wanted cars that would start and run perfectly in every climate, from Alaska to Arizona. They wanted cars that could handle city potholes and dirt roads and 75 mph highways four hours at a time with the air conditioning on. Not every Renault was up to those tasks. As one AMC executive put it, nobody at Renault knew their cars leaked oil, because everyone in France parks on the street. In America, people were alarmed to find puddles when they backed out of their garages in the morning.

Despite being outdated, most AMC cars had big, lazy, bulletproof inline-six engines. The Renault cars had higher-tech, more efficient powertrains, but they lacked the durability American drivers wanted. Plus, French cars all felt just a little… foreign. With their avant-garde styling and often unusual interiors, the cars just didn’t click with American buyers. 

“They didn’t make a lot of effort to fine-tune those vehicles for the American market,” John Davis told us during an interview about 1980s cars. “So you got in them, and the radios were weird, the gauges were not quite placed where we would like them, and even the warning lights were different… It all made it a little uncomfortable.”

During that era, Japanese automakers heavily researched American consumer tastes and updated their vehicles accordingly. Meanwhile, many European companies felt like their cars were already good enough, and it was the Americans’ fault if they didn’t like something. 

Thankfully, AMC designers and engineers had been given much more time to work on the upcoming joint-venture car, known by the codename X42. Management hoped that American consumers would feel more at home behind the wheel of the X42 than they had with the LeCar, 19i, and Fuego. 

Falling In Love

Having largely accepted their fate under Renault, many AMC employees found themselves quite happy. As people on both sides got to know their counterparts better, mutual respect developed. Management could still argue and debate, but most of the engineering and design staff bonded over a shared love of automobiles.

“We would send that talent back and forth across the pond on a regular basis,” Perrine said. “And I think that’s what, from my perspective, helped me see those two companies coming together… Engineers just seem to get along with each other because we all have a common goal. We want this thing to succeed. We want it to be right. We want our customers to be happy with it. We want it to work.”

Exchange programs allowed Americans to live and work in Paris, where they could see Renault’s high-tech facilities in person and learn about the wonders of wine-filled two-hour lunches. The French came to Detroit, Toledo, and Kenosha, where they learned about fine mid-west American cuisine.

“We went to breakfast one morning, and one fellow said,” Pam told us, switching to a thick French accent. “‘I waunt my eggs ‘suuny side oop!’ And I said, ‘oh do you like them that way?’ He says, ‘No, but I love to say it!’”

Some cultural differences were harder to resolve, as the French were adamant about a 36-hour work week and no more. For AMC employees used to working 50-60 hour weeks, this created a feeling that the Renault side wasn’t pulling its weight.

Meanwhile, according to Joe Cappy’s memoir,  Jose Dedeurwaerder caused more than a few eye rolls when a pretty blonde bartender he met in Kenosha showed up to work at AMC headquarters as his “assistant.”

Making fun of both his behavior and difficult-to-pronounce name, employees surreptitiously referred to the company president as “Dirtywater” behind his back. While other Detroit executives were hardly innocent of office hanky panky, his failed attempt at subtlety was compounded when his new assistant left a steamy note for him on the wrong company car. Apparently, she didn’t realize that her boss wasn’t the only executive who drove a black Grand Wagoneer with gold wheels.

Faced with the unenviable task of dragging the company’s cash-strapped operations into the modern era, Dedeurwaerder brought a wealth of manufacturing knowledge and experience to American Motors. But his dismissive leadership style–combined with his extra-curricular activities–certainly didn’t help his reputation at conservative AMC.

The Alliance

With the much-awaited X42 subcompact coming to completion, employees and the press still wondered how it would be branded. The car debuted in September 1982 as the 1983 Renault Alliance. The decision, though predictable, was disappointing for many. After all, the car was built in Kenosha by American Motors Corporation employees, but Renault was getting all the glory. 

An “AMC” badge was added to the trunk lid at the last minute to help placate dealers and win over some AMC loyalists, but any reference to American Motors in the marketing and sales material was minimal. The AMC brand was on the way out, and soon the 4WD Eagle would be its only product offering.

If Renault and AMC were a couple, then the Alliance was the baby that would supposedly “save the marriage.” From my personal research, it seems that the Alliance got more marketing attention than pretty much any other AMC product launch in history.  The number of TV commercials, print ads, custom hats, factory tours, auto shows, press days, and other promotional items and events simply dwarfs anything I’ve found for any other AMC or Jeep model.

All this hullabaloo did seem warranted. After years of hemorrhaging cash, American Motors finally had a new product that was competitive in every metric of the country’s hottest market segment. The Renault Alliance won MotorTrend’s Car of the Year and made it onto Car and Driver’s 10 Best list.

Naturally, there were some teething problems, as it was AMC’s first time building a front-wheel-drive, fuel-injected car. Factory workers had to learn how to diagnose and repair the Alliance’s complex electronics and how to gently handle the car’s much thinner sheet metal without denting it. It wasn’t as exciting as building Javelins or AMXs, but most employees were just happy to have jobs. After years of layoffs and downsizing, AMC began to hire again, and the plant was churning out as many Alliances as they could build.

It seemed Renault and AMC finally had a winner on their hands. MotorWeek described it as “… a fine, thrifty, good-handling, roomy, highly-domesticated European sedan that’s made in the U.S.” And generally, that’s how most of the AMC employees we interviewed felt about it, too. They were proud that little AMC could (with a lot of French money and French-built components) go from manufacturing old-fashioned Spirits and Concords to such a modern car.

Highs and Lows

While the Alliance was essentially a Renault design that underwent a thorough “naturalization,” the partnership’s next big product was largely home-grown. It is no understatement to say that the 1984 Jeep Cherokee/Wagoneer, known internally as the XJ, was (and is) one of the greatest SUVs of all time. It embodied the best of both companies, as the world’s first modern, compact four-door, unibody SUV. 

Overseen by VP for Product Engineering and Development, François Castaing, AMC stylists designed a look that was both pure ‘80s yet timelessly iconic. Engineers created a platform that was light, nimble, spacious, and rugged. To build the XJ, the old Toledo Jeep plant was upgraded with some of the most modern robotic assembly equipment in the industry. The XJ was pure Jeep, but it wouldn’t have been possible without the French.

SUVs were growing in popularity during the 1980s, but passenger cars were still the industry’s bread and butter. While XJ sales increased almost every year, Alliance sales, sadly, did the opposite. It had taken Renault and AMC almost six years to launch the new fuel-efficient subcompact that Gerry Meyers had envisioned in 1977. During that time, the economy had begun to recover and gasoline prices were going back down. As fickle as ever, American consumers began flocking back to big cars, which AMC no longer had.

To make matters worse, dreaded quality issues began popping up. Although the Alliance underwent far more durability testing than the imported French-built Renaults, familiar problems were emerging.

“One of them was the cooling system,” Perrine said. “It had to be purged properly and if it wasn’t, the car would overheat and a lot of engine damage would happen. And it took people a long time to figure that out.”

Electronics and fuel injection remained issues, also. Buyers and mechanics just weren’t used to the new technology yet. The company sent dealerships hours of video on Laserdisc, explaining maintenance, troubleshooting, and repair procedures.

Battery troubles would cause cars to die, especially in the cold. A Kenosha plant employee told me that whenever he left the plant in the middle of the night for the 3rd shift change, there’d be Alliances all over the parking lot with their hoods up, unable to start during those brutal Wisconsin winter nights. As the market for subcompact cars shrunk, the Alliance was (figuratively and literally) left out in the cold. Buyers who still wanted a small car had plenty of choices, and nobody wanted to get stuck with a potential lemon.

Despite this, most of the former employees we interviewed said they liked the Alliance. They were proud to “buy what you build,” and the Alliance was a comfortable, affordable car that handled well and got stellar gas mileage (when it ran).

The Divorce

They say problems with money and sex are the two biggest causes of divorce, and the AMC-Renault marriage had both. Of the two, the money problems were far more serious. Ever-increasing Jeep sales couldn’t offset weak Renault sales, the same way they couldn’t offset weak AMC sales before that.

“The French had been pouring money into American Motors, and it was going right out the bottom in red ink,” said Cappy, who became CEO in 1986. “From 1980 to 1983, American Motors lost three-quarters of a billion dollars. Now I don’t care what you say, when it comes with a B, it’s a lot of money. And the French government at the same time was laying off workers in France. So they had a political problem in France, because they saw all of this money being sent overseas to American Motors.”

All that money had been sent with the expectation that it’d be earned back someday. Yet, that was looking more and more unlikely. Renault simply couldn’t break into the U.S. market, and with its deep ties to the French government, the politicians were getting impatient.

Lee Iacocca, riding high on Chrysler’s success, came sniffing around during the mid-’80s for a deal to buy the Jeep division, but Renault’s chairman in France, Georges Besse, still had hopes for turning things around. However, when Besse was assassinated by anti-capitalist French anarchists in 1986, his successors were eager to wash their hands of the whole affair, and they quickly struck a deal to sell AMC and Jeep to Chrysler. The remaining shareholders soon signed on, too.

Years later, some criticized Renault for pulling the plug just as the partnership looked ready to round the corner. The U.S. economy was still improving, and they had some exciting new vehicles in the pipeline. Projections for the rest of the 1980s had looked profitable.

“I think if the relationship would have lasted a lot longer, the next generation product you saw might have been a little bit different,” Perrine said. “Unfortunately, we just never got to see it happen.”

It’s impossible to attribute the failure of the AMC-Renault partnership to one specific thing. You could blame it on stubborn management, faulty products, cultural differences, the economy, gas prices being too high, gas prices being too low, or a thousand other factors.

When I first started producing this documentary, I largely viewed the Renault merger as a mistake on AMC’s part; it was a desperate decision to cede control to a company that didn’t understand the U.S. auto market. I slowly learned that the truth is far more complex than that. Without Renault, AMC would have likely gone bankrupt and been dismantled by the early 80s. With Renault, AMC gave up its independence but still created some great products.

Despite its faults, the Alliance was a huge product for AMC, and the upcoming Renault Premiere (which became the Eagle Premiere) was a highly competent car, too. Not to mention, the Jeep XJ, the Jeep Wrangler, and Jeep Grand Cherokee all owed part of their existence to Renault. Plus, scores of Renault and AMC designers and engineers would go on to play a significant role in reinvigorating Chrysler’s product offerings, including the groundbreaking 1994 Dodge Ram and the remarkably advanced “cab forward” LH platform cars.

Joint ventures are a tricky business, but the auto industry seems unable to resist them. Some, like Ford’s Premiere Automotive Group, end in disaster. Others, like Stellantis, seem to work out (for now). Almost any foreign company that wants to build cars in China has to partner with a domestic automaker, meaning that there are probably lots of unhappy corporate marriages there, but they seem to make it work. Nissan later partnered with Renault, and that’s had its ups and downs, to say the least. 

Meyers, Huegli, Pascoe, and Perrine are just four of the over 30 former AMC employees I personally interviewed for our documentary, The Last Independent Automaker. I’ve asked almost every single one what it was like working with the French, and I’m always surprised by their responses.

This week alone, we've talked to 14 former AMC employees and family members, which makes a new record for most interviews we've done in such a short time.

There's a lot to be learned about cars by talking to the people who made a living building, selling, and repairing them. pic.twitter.com/7mEgvdVCzV

— Joe Ligo (@JoeLigo) August 6, 2022

Three decades later, some are still bitter over the way Renault management treated them and the way things ended. In that old American way, people just don’t like having somebody from another country come in and tell them how to do things. 

But there are far more people like Pam, who saw it as a once-in-a-lifetime experience to learn, travel, build great things, and make friends around the world.  Today, she still lives in Michigan but has retired from the auto industry.  Now she leads guided tours of France, where she often stops to meet old colleagues from Renault.

“Our AMC people didn’t back down just because we were David and they were Goliath,” she told us. “ I mean, they went toe to toe and nose to nose a lot of the time to defend what they felt they needed to do… I was just the teacher and the translator. I was the one trying to make everyone get along and understand each other. I loved it there. It was seven years of fun.”

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