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.
28 thoughts on “Open One Eye when you Sell, and Both Eyes when you Buy”
Good morning, Bruno. What a fascinating story about GM’s Middle Eastern outfit. I think the badge on the Seville with the Persian writing on it is fascinating. Without your article I would have never known. Thanks, Bruno and DTW for yet again disclosing wonderful automotive tales.
Good morning Bruno. I share Freerk’s appreciation for these great stories. Regarding the first, it serves GM right that it came unstuck for flouting the spirit if not the letter of the US sanctions against Iran. Irrespective of whether they agree with them or not, individuals and corporations should observe the laws put in place by their elected representatives as that’s the basis on which democracy works.
Keep up the excellent detective work! 👍
This highlights the gap between legal rectitude and ethical rectitude. Too often corporations see the law not as a minumum but as the upper limit of responsibility. Iran is a really interesting country. I think Robert Byron presents it interestingly in his book The Road to Oxiana (the 1930s). Å more recent account is Robert MacFarquhar´s memoir “The press relations office of the Hizbollah wishes you a happy birthday.”
I love these stories Bruno, and I enjoy them a lot. Thanks!!
Hi Bruno, this story is really fascinating. I don’t really know that much about american cars – I’ve always viewed them as technically and aesthetically inferior to the ones designed and made in Europe. But still, this generation of the Seville has a certain appeal I can’t quite put my finger on. Thanks for the post!
I feel like the traditional American car only makes sense within the context of America with the lazy transmissions, big V8s, rudimentary engineering, and ice-cold AC perfect for crossing Arizona at 130 kph with the radio blasting! Whether it was through lack of dealer network, lack of mechanical expertise, or difficulty sourcing parts, few European car makers have established a reputation for reliability in the states (Volvo being perhaps the only, along with Sacco-era Mercedes-Benz).
You would not want to cross Arizona at 130 kph in an American car.
Last time I tried this with a Chevrolet Caprice (partly on the AZ-88) I was astonished how this car suddenly changed its character at 70 mph/112 kph from a wallowy but comfortable over-airconditioned sofa to a vibrating tinbox that gave the impression that if would disintegrate at any moment.
My 2009 Lancia Delta did this: the culprits were terribly worn UV and CV joints and engine and gearbox mounts.
Dave: well, my grandfather always regales us with the tale of the time he got his B-body Impala doing 100 mph down Highway 5 at night when it suddenly became day! because the highway patrol decided a helicopter with spotlights was necessary to track him down. He still has a lead foot even though he’s since migrated to the ubiquitous Lexus RX…
Thank you for your kind words Freerk, Daniel, b234r and Konstantinos- it is always good to hear the content of DTW is appreciated!
Large companies with worldwide interests do indeed at times bend, circumvent, distort or even blatantly break the rules -be they legal or moral, written or unwritten- to serve their own interests. Some decades before the Iraqibu debacle, GM had a much darker episode of which they understandably don’t like to talk too much: during world war 2, GM produced -and made money from- building tanks and trucks for the American and British armed forces,
but also from their Opel division in Nazi Germany that produced the Blitz trucks used by the German army.
On Konstantinos’ view of American cars being technically and aesthetically inferior to the ones made in Europe: aesthetics are of course a matter of taste, but in roughly the period 1945-1960 many European carmakers -and not only those that were part of GM, Chrysler or Ford USA- fielded cars that were stylistically obviously influenced by their American counterparts.
It is true that the 1980s were not exactly the American automobile’s finest hour, but for example in the 1930s American luxury cars like Duesenberg, Pierce Arrow, Packard and such did not have to fear comparison with a Rolls Royce or the like. Even in the 1950s a Cadillac represented a very real (but also very large) alternative
to the European luxury cars, and indeed quite a few found owners in Europe.
The American car was also responsible for introducing many of the creature comforts and convenience details that were later adopted by the rest of the car industry; the electric starter (Cadillac), automatic transmission (Oldsmobile), power steering (Chrysler), airconditioning (Packard), climate control (Cadillac) and more.
From the sixties on, they started to lose their way and their leading position, though not all of that was their fault- legislation forced upon them had a lot to do with the resulting behemoths.
Richard Herriott: Iran certainly is an intriguing country with an interesting history; it’s one of those places that is on my mental “I should go there one day” list and I hope to be able to make that wish a reality someday.
Thank you Bruno for the article and for new information on GM’s history in the Middle East – I had read previously about the Iraqi Malibu order, but I had no idea that Cadillacs were ever produced in Tehran. GM has a presence in the Gulf states to this day and the Australian-built Holden Commodore/Caprice (a large, tough, and comparatively simple RWD sedan) sold there consistently, usually re-badged as a Chevrolet.
– I recall reading that the Iraqi Malibus were so basic a specification that the rear side windows were fixed in place (no glass sliding tracks, gears or cranks fitted) – though perhaps this does help to make the air conditioning more efficient.
– It would not be surprising to assume that cars flagged for export from the very beginning of production may have been produced with a bit less care and consideration for tolerances as they went down the line, especially with GM’s 1980s quality control in full (absence of) effect.
– I wonder if the Persian-script Cadillac badge had a global GM part number or RPO code (GM’s indecipherable cross-brand option and production numbering system)? If so, I wonder if anyone in the US tried to order one from the dealer parts desk for their Seville.
Neil, all Malibus from that generation (78-83) had fixed rear windows. The glass in the C pillar could be opened slightly.
As I mentioned below, any Malibu was built to low standards. I doubt that these were any worse. These cars were the last gasp of 1950s GM technology, built with tooling that was just as ancient.
Neil, regarding the rear side windows: This design feature was not unique to the Iraqi version or even just the Malibu. Lucky rear seat passengers were awarded the consolation prize of some extra elbow room; also the quarter light window did open outwards barely enough to avert death by suffocation.
The Chrysler K-Car also started its life with fixed rear windows, although these only lasted one model year.
I remember those Iraqi Malibus. They were a curiosity in Canada, mostly because of the manual transmission and air conditioning. Regular Canadian Malibus were optioned the other way: automatic and no air conditioning.
My grandmother had a same-generation Malibu. The paint peeled-off in sections, the rear windows did not open (by design), power was lacking, fuel consumption was appalling, handling was approximate, and everything in the interior was a uniform light blue shade of plastic or vinyl. I passed my driving test in that car, and had access to it as a teenager, so it holds a place in my heart, but it was objectively a bad car. Like every Malibu, it died an early death. They were mostly all gone by 1990.
Iraqi Malibus were popular with Canadian taxi drivers, so they ended-up doing what they were built to do, albeit in a different climate.
Good evening, really interesting article, something completely new to me.
With regard to the World War 2 situation, both Ford and GM factories remained open in Germany, although officially they were under German control. H Nordhoff, recruited by the British to run VW had been decorated by the Nazis for keeping Opel truck production running, and then sacked by GM after the war as part of de-nazification.
I believe that both GM and Ford received compensation from the US government for bomb damage to their German factories.
The legacy of the wartime Opel Blitz was, in a way, extremely long lived. This probably merits an article of it’s own, but briefly, the engine of the Blitz was an American design; after the war, Daimler Benz, who had tooled up to build it designed a diesel (OM 312) to be built on the same tooling; this engine was evolved into a direct injection turbodiesel that was built well into the 90’s, still with the same main (imperial) dimensions of the GM block
Geo-political turmoil, GM ineptitude, and distressed merchandise. Brrrruno, yet again you spoil us.
Another interesting nook of automotive history illuminated by Bruno. Thank you! Those Malibus aren’t terribly nice-looking cars and one can imagine the Iraqis preferring Toyotas to them. After all, a lot of Americans did as well.
It feels extraordinary (but probably isn’t) to have four or five door cars with fixed rear side windows. I know that many cars have windows that only wind down halfway and the five door Peugeot Aygo, Citroën 107, Toyota C1 have rear side windows that open outward just a bit, but that’s obviously cost cutting.
Don’t forget the 2CV as a four door car with fixed rear side windows…
Very true, what’s more, only half the front side windows could flip up to great comedic effect:
The 2CV’s flip up windows were held open by simple a snap-in fastener. When this was worn out the windows had the habit to come loose in corners and fell down on the elbow of the driver – particularly funny if they hit the ‘electric bone’ in the elbow. To keep the windows partially open you could buy bent wire devices from a couple of sources
Ah, the Burton: a swanky (?…) roadster built from 2cv parts.
Getting severely OT.
I’d prefer the Lomax three wheeler
Morgan looks but 2CV roll angles and performance levels…
That would be something of a safety feature (the performance levels, not the roll angles, which I would imagine to be even more alarming on a three wheeler)…
I believe that the early Chrysler K cars had fixed rear windows at around the same time.
This happened twice more in the Saddam era. A couple years after the Malibus, Iraq canceled an order for Brazilian-made VW Passats (B1). All were four-door sedans at a time when non-hatch fastbacks had become passe’ on world markets and the Brazilian home market overwhelmingly preferred 2-door cars. Sometime in the ’90s an order of Volgas underwent a similar non-delivery scenario and GAZ had to sell them, sans heaters, around Nizhny Novgorod.
It happened with Peugeot 205s, too, apparently. An order of 600 ‘Gentry’ models was cancelled by Japan and ended up in the UK. Nice car, but I’d prefer something plainer.