Chrysler Discards Plans for Liberty High-Tech Auto

Chairman Lee A. Iacocca said today that Chrysler Corp. has scrapped plans for its Liberty car, which was designed to use high technology to overcome Japan’s cost advantages in the building of small cars.

Liberty was to be Chrysler’s answer to General Motors Corp.’s highly publicized Saturn car project. Just a month ago, Iacocca declared that Chrysler would beat GM to market with its high-tech small car.

Instead, Chrysler will import at least 200,000 cars a year from its Japanese partner, Mitsubishi Motors Corp., after 1987.

Earlier this week, Iacocca announced that Chrysler and Mitsubishi will also form a joint venture to build 180,000 small cars a year in the American Midwest. Because of higher U.S. costs, Chrysler’s cheapest cars will be those imported from Japan, Iacocca said. The U.S. joint-venture car, he said, will be more upscale and cost about $2,000 more than the imports.