Recalling General Motors’ Middle Eastern misadventures.
The title of this tale is a Middle Eastern proverb, somewhat similar to our adage ‘Buyer beware’, but it expands on this in the sense that it also cautions sellers to keep an eye on proceedings at all times. On two separate occasions involving different Middle East countries, General Motors found to its cost what can happen if this advice is not heeded, dragging it into controversy and a hostile environment when the political winds changed direction.
A trade dispute between Japan and Iraq was the improbable cause of trouble for GM Canada. In 1980, Toyota was the number-one selling car in Iraq, and had been for some years. That same year, the Japanese manufacturer initiated talks with Ford about a possible joint venture. The fact that Ford operated an important assembly plant in Israel, however, did not go down well with the Iraqis, who in consequence started looking for a different supplier for the country’s official cars and taxi cabs.
General Motors ended up top of the list of preferred suppliers, but dealing directly with Detroit was out of the question as the US government had imposed a trade embargo on Iraq after Saddam Hussein seized power in 1979. Instead, the Iraqis approached GM Canada and, in March 1981, an agreement was reached for an order of 10,000 Chevrolet Malibu cars, with a prospective order for another 12,500 cars in the pipeline.
The cars destined for Iraq were specially equipped to withstand the harsh conditions of the Middle East. This included fitting a heavy-duty cooling system, the ‘F41’ sport suspension and a three-speed manual transmission with floor shift. Aside from upgraded air conditioning and an AM/FM radio, the level of standard equipment was very sparse. Power was provided by a 3.8-litre carburettor V6 delivering just 110bhp (82kW). Small ‘dog dish’ hubcaps adorned the steel wheels and the speedometer read in Km/h instead of mph. A hardwearing if somewhat coarse looking fabric was used for the interior upholstery. No pollution control devices of any kind were installed as these were not required in Iraq.
The first order was duly produced and shipped. In March 1982, however, Iraq expressed its dissatisfaction with the delivered Malibus through its then ambassador to Canada, a Mr. Al-Dairi. The complaint cited substandard quality and workmanship, malfunctioning clutches, fast-clogging air filters and even the absence of a clock in the dashboard, which was claimed to be an agreed item of standard equipment. GM Canada was informed that the Iraqi government was not interested in ordering any more Chevrolet Malibus.
Consternation ensued at GM Canada as the anticipated second batch of 12,500 cars had already been produced and was sitting on loading docks in Oshawa and Halifax awaiting shipment. When informed about this, the Iraqi ambassador countered that any order was conditional on the approval of the country’s High Council of Trade. The council had not given authorization for the second order, meaning that no funds were ever reserved for the vehicles. It transpired that the president of GM Canada had authorised the manufacture of the second batch before the order had been formalized by Iraq, and that seal of approval was never forthcoming. This oversight would cost the President of GM Canada his job, while the head of the company’s PR bureau was also fired for being publicly quoted as referring to the Iraqis as ‘camel jockeys’.
Even though the era was not a high point in terms of the quality of construction and workmanship anywhere within the GM empire, the real reason that the Iraqis reneged on the deal may have been quite different. The planned joint venture between Toyota and Ford never happened and, not long after saying goodbye to GM, the Iraqi government ordered another 15,000 cars from Toyota. Another (rather implausible) theory is that, because many of the Malibus were given as a compensation payment to Iraqi families who had lost a son in the Iran-Iran war(1), the authorities feared that western intelligence agencies could deduce from the number of cars ordered how the war was going for Iraq.
Whatever the reason, GM Canada was stuck with a whole lot of unwanted Malibus parked outdoors and exposed to the elements. Apart from the fact that they were of a specification unsuited to the North American climate, with no heated rear window, for example, the cars also lacked catalytic converters and the specific unleaded fuel filler necks that were legally required for compliance with Canadian auto emissions legislation. Hence, some costly retrofitting was required in order to be able to sell the Malibus, but this was preferable to scrapping all 12,500 cars. GM Canada employees would be first in line to buy one of the ‘Iraqibus’. The cars were sold for around C$6,500, which was slightly more than half the price of a regular Malibu.
The very basic equipment level, three-speed manual gearbox and the absence of a heated rear window proved to be hurdles easily and happily cleared, thanks to the very low price. Many GM Canada employees drove the cars for around a year and then sold them on for the same amount of money they paid for them.
Today, not many of the ‘Iraqibus’ have survived as they generally lived a hard life. More than a few were hot-rodded by fitting much more powerful engines as the basic car was relatively light, equipped with a manual gearbox and had the F41 sports suspension. There are plenty of reports from former owners who found the cars to have been quite reliable and sturdy, which further undermines the Iraqi claims of substandard quality.
The 15th January 1974 witnessed a momentous occasion: General Motors Iran started its production lines in a plant a few miles outside of the capital, Tehran. The first model produced was a Chevrolet Iran badged version of the Opel Rekord D. Soon afterwards, selected models from the American arm of GM were also built there from CKD(2) kits, including the Buick Skylark, which would be the first V8-engined vehicle to be produced on Iranian soil, the Chevrolet Nova and even the pricey Cadillac Seville.
This was the first and only time a Cadillac would be manufactured outside the United States until the German-built Catera was introduced in 1997. At an equivalent price of US$ 35,000 (more than twice its US market price) the Seville was clearly not for everybody, but then again, if an Iranian national wanted to import a US-built Chevrolet, the various duties and taxes imposed on it would have raised the bill to similar heights.
“As soon as they have the money, they want a pair of Levi’s and a car,” a General Motors official was quoted when asked about the Iranians. This was, perhaps, a politically incorrect view, but at that time in a relatively modern and liberal pre-revolutionary Iran ruled by the Shah, it was probably not far from the truth.
In order to ensure that the locally produced Sevilles were screwed together properly, GM sent over six Cadillac employees to oversee the operation. The first Seville was completed on the 1st March 1977. The first seventy or so cars were all painted in metallic gold and went straight to the Iranian government. The Iranian Sevilles were fitted with a more free-breathing V8 engine without emissions control equipment, so delivered at least 20 bhp more than the American version.
Between 800 and 1,000 Sevilles are said to have been assembled up to the end of 1978 when the imminent Islamic revolution and resulting chaos in the country caused the operation to stall. With Ayatollah Khomeini in charge after the Shah fled the country, the relationship with GM was abruptly terminated and the company renamed Khodrosazi Iran and later, Pars Khodro.
Even though the new regime officially loathed all western products, especially those of American origin, as symbols of a decadent and infidel society, assembly of the Seville as well as the Chevrolet Nova and Buick Skylark was resumed. This was presumably done by using leftover CKD kits and sundry parts in stock, which would explain the extremely low production rate during this period: by the end of 1983, just 37 more Sevilles had been built, and the last one was reportedly completed as late as 1987, while the last Iranian Chevrolet Nova, US production of which having ended in 1979, rolled off the line in 1992.
(1) In Iraq, the Chevrolet Malibu was referred to as ‘the car of mourning’, because of the similarity of its name to the Iraqi words ‘mal’ (belong to) and ‘iubu’ (the sound of a woman crying).
(2) Completely Knocked Down, in essence a 1:1 scale model kit for local assembly.