How the Dodge Viper brought Chrysler back from the dead

The Dodge Viper has always been a fearsome machine. It is the only mass-produced two-seat sports car with a front-mounted V10 engine and was available exclusively with a six-speed manual transmission. The first-generation Viper RT/10 roadster had no air conditioning, no glass side windows, and no exterior door handles. The last Viper, built in the 2017 model year, had all the basic amenities you’d expect from an expensive sports car, but with 645 horsepower and rear-wheel drive, it was still a raw, untamed beast.

But the story of the Viper is more than just a story of horsepower and speed. According to car mogul Bob Lutz, the first generation Viper helped save Chrysler from the brink of ruin.

Lutz was vice president of Chrysler when the Viper project was launched; his entire career includes leadership roles at BMW, Ford, Chrysler and General Motors. Today Lutz is 92 years old and mostly retired, but he is still one of the most quotable and outspoken executives in the auto industry. Today we look back at the story of how Lutz took the Dodge Viper from concept car to production in the late 1980s and early 1990s – and how this iconic American sports car helped turn the tide and lead Chrysler into an era of unprecedented success. This article draws heavily on Lutz’s 1999 book, Courage: The seven laws of economics that made Chrysler the hottest carmaker in the worldwith further details from my keynote speech with Lutz at the Classic Car Club of Manhattan earlier this year.

The Viper was born on a drive through rural Michigan. It was 1988, and Chrysler was in a precarious position. The company had fought its way back from the brink of failure in the mid-1970s, thanks largely to the success of two products: the compact, fuel-efficient K Car and the first incarnation of the modern minivan. By the late 1980s, Chrysler was struggling to plan its next move. The automaker’s lineup consisted almost entirely of outdated, boring K Car derivatives that couldn’t compete with the latest offerings from GM, Ford, and the Japanese automakers.

All of this was going through Lutz’s mind as he sped along the country roads of southeast Michigan. As he OffalLutz drove his Autokraft Mk IV Cobra, a replica of the legendary Shelby Cobra powered by a Ford big-block engine. When it was released in 1962, the Cobra became an instant phenomenon. It was a racing success and a desirable street sports car that stole the show from the Corvette and helped Ford become a racing superpower.

Soon Lutz had an idea. Chrysler was working on a big-block V10 engine for the all-new Dodge Ram pickup truck, which was to be launched in 1994. What if Chrysler installed this truck engine in a small, lightweight two-seater sports car? “What we needed most was (…) proof that Chrysler was not dead, that our company was bubbling with the optimism, creativity and indignation we needed to get us back on track,” Lutz writes in OffalA Cobra-style sports car could send that very message to the world.

Inspired, Lutz explained his idea to the people at Chrysler who could help him implement it: Tom Gale, Chrysler’s head of design, and François Castaing, then technical director for Jeep and pickup models. “It took the three of us about 10 minutes to decide to at least make some initial design sketches and preliminary mechanical designs,” writes Lutz. Tom Gale sketched out an initial design idea and then had his team create a full-size clay model of it. When he saw the model, writes Lutz, “I was overwhelmed by its impact. I was immediately enthusiastic.”

The Viper concept car was presented at the 1989 Detroit Auto Show. As Lutz describes it, the response was overwhelmingly positive. Chrysler received letters from people across America who were eager to own this impressive new sports car. Even executives from rival automakers congratulated Lutz and his team on their success – although rumors circulated that Ford executives were upset that the Viper was inspired by their own catalog. “That we shamelessly exploited Ford’s heritage didn’t bother me much,” Lutz writes in Guts. “The myth of the Cobra went beyond the ownership of individual companies.” Moreover, as the executive points out, Carroll Shelby had long since severed his ties with Ford and was Chrysler’s exclusive consultant at the time. So who better to take care of the Cobra’s return?

Now the challenge was to build a production, road-going Viper. “We knew the project had to be small in terms of investment,” writes Lutz. “We knew it had to happen quickly, before the public forgot the impact of the show car” – and before Chevrolet could steal the show from the Viper with a new Corvette.

Lutz and the rest of the Viper crew knew they couldn’t build a car like the Viper the traditional Chrysler way – slow committees, endless research and dense corporate hierarchy. “We needed a small, agile, highly motivated cadre of commando-type car geeks,” as Lutz puts it.

So Lutz, Gale and Castaing called a meeting and asked for volunteers interested in working on Viper. From that list, the leaders chose 80 “shock troops” and appointed Roy Sjoberg, formerly a key member of the Corvette development team, as leader. A new Viper headquarters was set up in a former AMC development building on the west side of Detroit. Compared to normal business operations at Chrysler, this was a radical departure. “Whenever a problem arose that required the involvement of several team members, Roy Sjoberg rang a big school bell, the signal for everyone to drop their work, gather together and work out a solution.”

Developing the Viper to production quality was a problem. The team soon realized that the cast-iron V10 engine from the Dodge Ram pickup would be too heavy for a sports car; the Viper’s engine would be made of aluminum, which increased the program’s costs. A German transmission supplier wanted too much money to develop a six-speed manual transmission that could handle the Viper’s power, so Lutz’s team negotiated a deal that used the Tremec transmission developed for the Chevrolet Corvette and Camaro.

The bigger challenge would be convincing Chrysler bosses that developing the Viper was worth it. The team would need $80 million to develop the new sports car – “small change” for a completely new car, writes Lutz, but money that the struggling automaker might not spend on a low-volume sports car. With an expected price of $50,000, the Viper would be more than twice as expensive as anything Dodge has ever sold.

This is where the Viper’s halo effect began to emerge. In the book, Lutz tells a story — which he repeated at the Classic Car Club event — of meetings with banks around the world in 1991 to secure ongoing financing for Chrysler. At one of those meetings, an analyst asked Lutz what projects Chrysler would cut if the company ran out of money. “I put on my most sober, financially responsible face and told him we might have to cut the Viper,” Lutz writes. “The buttoned-up East Coaster recoiled in horror. ‘My God,’ he said. ‘You can’t do that! This car changes everyone’s perception of the company. It restores confidence. It’s the last You should cut that!'” At another such meeting, with a German bank, the CEO takes Lutz aside to speak privately. Lutz braces himself, thinking he will be told that the terms of their agreement have changed for the worse. The manager gives Lutz his business card. “I want you to contact me when that red sports car comes out,” Lutz remembers the CEO saying. “I don’t care what it costs. I really want it.”

The first production models of the Viper began shipping in late 1991. The first models suffered from some teething issues, but early owners loved their cars so much, Lutz writes, that they worked with Chrysler engineers to improve later models. “It was not uncommon for a Viper team member to fly across the country with a spare part under his arm to repair an owner’s first Viper on the spot,” he writes.

The first generation Viper was a financial success in its own right: It was inexpensive to develop, demand exceeded production capacity, and price was not an obstacle – especially since the Viper outperformed European supercars that were twice as expensive. When the hardtop Viper GTS came out in 1996, Lutz says, many RT/10 owners decided they needed a second Viper. Many Viper owners had never considered a Chrysler product; many of them bought multiple Chrysler, Dodge, and Jeep products for their family members after their Viper was delivered.

“So it is with many projects that are fortunately viewed from the right side of the brain,” Lutz writes. “They bring benefits that elude left-brain analysis.” The Viper helped convince financiers, investors, automotive journalists and even Chrysler employees themselves that the automaker had a bright future ahead of it. Lutz sums it up best: “The Viper, in short, was profitable in ways that cannot be quantified.”