Part 54 Lamborghini – New Models and Financial Woes

The History of the Italian Automobile

Part 54 Lamborghini – New Models and Financial Woes

By David Cavaliere

The late 1960s and early 1970s were a period of immense change in the automotive world. With greater governmental safety regulations, emissions controls and then the 1973, oil crisis, the tail was wagging the dog in the motoring world. In Italy, labor relations, always a tenuous issue, reached the breaking point, significantly slowing production due to strikes and work slowdowns. The talents of the most able-bodied were stretched to the limits and many Italian capitalists like Ferruccio Lamborghini found that their empires began to dangle by a financial thread. 

Once the company entered the mid-1960s, Lamborghini was emerging from a fledgling automaker to a leader in the world of supercars. By end of 1966, the workforce at the Sant’Agata factory had expanded to 300. Production of the 400GT continued, but by 1966, Ferruccio Lamborghini wanted to replace the four-year-old design. Lamborghini commissioned Carrozzeria Touring to design the replacement, but the car – the 400 GT Flying Star II did not win Ferruccio’s approval.  Nor did the design of coachbuilders Neri and Bonacini – the 400GT Monza. Facing mounting financial difficulties, Touring would close its doors later in the year (to be reborn in the 21st century, but that is the story for another feature). Carrozzeria Marazzi was selected to re-body the 400GT, the result was the Islero. It was Ferrucio’s favorite car; the grand tourer that he had always desired.

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The Islero debuted at the 1968 Geneva Auto Show. Its design allowed for wider tires, better outward visibility, enhanced sound proofing and a roomier interior. Fitted with the 4-liter V12, independent suspension and disc brakes, the car was fast and plush. Although the car possessed all of the qualities that Ferruccio wanted in a grand tourer, the Islero was not a sales success. Only 125 were built. An updated version, the Islero S, was released in 1969. The engine was tuned to produce an additional 25 hp to 350. There were numerous styling changes, including an enlarged hood scoop (which supplied air to the interior of the car, not the engine), slightly flared fenders, larger brake discs and revised rear suspension. Only 100 examples of the Islero S were built, bringing the production total of the Islero to 225 cars.

In August 1968, Gian Paolo Dallara, frustrated with Ferruccio Lamborghini’s refusal to participate in motorsport, was recruited away from Sant’Agata to head the Formula One program at rival automaker De Tomaso in Modena. Lamborghini not only did not want to participate in auto racing, but was against building prototypes. He said, “I wish to build GT cars without defects – quite normal, conventional but perfect – not a technical bomb.” In other words, he wanted his cars to be superior to the works of Enzo Ferrari.

Dallara’s assistant, Paolo Stanzani, replaced him as technical director. Bertone was able to persuade Lamborghini to allow them to design a brand-new four-seater. The shape was penned by Marcello Gandini and was based on the Marzal show car, displayed at the 1967 Geneva Auto Show. A body shell was delivered to Ferruccio for inspection. Lamborghini insisted that the original gullwing doors be replaced with conventional ones and the car that resulted, the Espada, debuted the following year at the 1968 Geneva Auto Show. The front engine car proved to be the company’s best seller of the era with 1,217 cars made over its ten years of production. Over that period, three different series were produced – the S1 (1968–1970), S2 (1970–1972) and S3 (1972–1978). Each model featured interior redesigns, but only minor details were changed on the exterior. The original design featured octagonal housings for the main instruments, topped by an additional binnacle for the secondary gauges. No doubt, the amount of glass used on the car was the most obvious styling feature of the Espada – it seemed to have acres of it. Its wheels were the same Campagnolo alloys as found on the Miura. At the 1970 Brussels Motor Show, Lamborghini unveiled the Espada S2. It had an entirely new dash, center console and steering wheel. The compression ratio in the engine was increased, bringing power up to 345 hp and its brakes were upgraded to Girling vented discs. 575 Series II Espadas were produced, making it the most popular and desirable of the series.

The Espada S3 was launched in 1972. Power was down to 321 hp, due to emissions control and the interior was changed to aluminum trim. This however kept all of the instruments and most controls within view and reach of the driver. The wheels were mounted on five-stud hub, rather than center locks. An automatic transmission (from Borg Warner) was offered in 1974 and in 1975, large impact bumpers were installed to meet U.S. safety regulations.

In 1969, Automobili Lamborghini encountered problems with its fully unionized work force. Ferruccio, whose office overlooked the factory floor, often rolled up his sleeves and joined in the work and was able to motivate his staff, despite disruptions in receiving parts from outside suppliers. Throughout the year, Lamborghini’s product range consisted of the Islero, Espada and the Miura S. In 1970, Lamborghini needed to redesign the Islero to meet new U.S. safety and emissions regulations. Its replacement, the Jarama 400GT, was built on an Espada chassis shortened by 10.7 inches. The 3.9-litre V12 was retained. Even though the Jarama was heavier than the Islero, it had the same top speed. Two different models were produced, the original GT (1970–1973) model having 350 hp and the GTS (1972–1976) with its output upped to 365 hp. A total of 328 Jaramas were built. The car bears some resemblance to the Iso Lele (see Part 49 – Iso of this series, March 2, 2017), and the external design is largely the same. Both were designed by Marcello Gandini.

The next model produced by Lamborghini started from a clean sheet. Intended as a lower-priced, higher volume 2 +2 sports car, the Urraco was powered by a newly designed V8. The intended competitors were the Dino 246 (See part 36 of this series – The Dino Ferrari Legacy, October 13, 2016) and the Porsche 911. Although introduced at the 1970 Turin Auto Show, it did not see production until 1973. Designed by Paolo Stanzani, the Urraco used nothing from the existing Lamborghini parts bin. The single overhead cam V8 designed by Stanzani produced 220 hp at 5000 rpm. Master road testing specialist Bob Wallace immediately began testing and development. Due to emissions regulations, by the time the Urraco was ready for production, the P111 version for the U.S. market produced a mere 180 hp. Only 21 P111s were built. The other Urraco versions were the Urraco P200 (2.0 liter), Urraco P250 (2.5 L) and Urraco P300 (3.0 L). When production ceased in 1979, 791 Urracos had been built.

In 1970, Lamborghini began development of a replacement for the Miura. Engineers designed a longer chassis that placed the engine longitudinally, further away from the driver’s seat. Designated the LP 500 for its intended 4.97-liter version of the company’s V12, the prototype was styled by Marcello Gandini at Bertone. The car debuted at the 1971 Geneva Motor Show.

Economics, politics and union requirements made the early 1970s a miserable time for Ferruccio Lamborghini. The tractor company experienced a financial crisis in 1971, when its export market began to come apart at the seams. Normally, half of the tractors built were shipped abroad; however 1971 saw the company’s South African importer cancel all of its orders. On the heels of this news, a huge order from Bolivia was cancelled, following a coup d’état in the South American country. The employees of the tractor unit were unionized, as such, Lamborghini could not reduce his work force. Without any prospects for improvement, in 1972, Lamborghini sold his tractor company holdings. Still, the remainder of the Lamborghini group was in financial trouble. Development at the automaker slowed. The LP 500 missed the 1972 Geneva Show, an embarrassment for the company. Stanzani had intended the engine for the new model to have a 5-liter V12. Development was proving to be more difficult than expected (the engine had a tendency to self-immolate). To save costs, he decided on the 4-liter for production.

In the meantime, Ferruccio Lamborghini was seeking investors for his car company. He entered into negotiations with Georges-Henri Rossetti, a wealthy Swiss businessman who was not only a friend, but an owner of numerous Lamborghinis. Ferruccio sold Rossetti 51% of the company for $600,000, thereby relinquishing control of the automaker he had founded.

In our next feature, the LP 500 reaches production and enjoys a 15 year production run. You may know it better by its model name – the Countach.

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