Frank Stronach: The man behind Magna International
He is nothing short of legend. A guy with a surname so powerful when its two syllables are pushed through your teeth, the metaphor is instant.
In the automotive world, there are players and then there are players.
Frank Stronach, even at 80 years of age, is every bit the latter.
He is a visionary. He's extremely wealthy. He's flamboyant. He has even been compared to Fidel Castro for his dominant style. But he is every bit still the same man he was when he first began washing dishes in various Toronto restaurants so he could open his own machine shop.
That was 1957. Fifty years later, Stronach's Magna International is one of the world's leading suppliers to automakers from around the world. Magna's parts make the world's auto companies tick.
Why? Two syllables: Stro-nach.
"When there is a global economic welfare," he once told Canadian Business Magazine, "you can only win if you attract the best people."
Stronach learned his craft from the inside of a Toronto garage where he was determined to build an empire out of his machine shop. He even slept on a cot in the corner of the building every night so that he could be there to start first thing in the morning.
He worked hard and business grew.
"Better product for a better price," became the company motto. It was Magna's mantra for years and how the company became an empire.
Three years into development of some of his parts, his machine shop landed its first auto contract to produce metal-stamped sunvisor brackets for General Motors. Things began to roll and before the 1960s were out, he merged his machinist venture with a public company called Magna Electronics Corporation, an aerospace, defense and industrial-components manufacturer.
More than 40 years later, with Stronach at the helm, Magna is one of the most diversified automotive suppliers in the world with more than 70,000 employees. Magna develops and manufactures vehicle systems, assemblies, modules and components. It has even engineered and assembled complete vehicles in Europe, including cars for BMW.
It is a $20-plus billion operation with Stronach taking home as much as $50 million in salary.
Not that he minds.
Stronach has been the voice of the independent and ruling aristocracy.
He has challenged shareholders: "I should have made more," he said at one annual meeting after collecting some $36 million in wages.
He doesn't back down. At the 2004 meeting, he referred to himself as a king and reminded shareholders they are free to take a walk.
He is unique with a capital "U".
"His focus, his intensity, his instinct are something of a phenomenon," said Dennis Mills, vice chairman of Magna Entertainment, the horse racing and gambling company controlled by Stronach. "And I say that as someone who has worked for four (Canadian) prime ministers and met most world leaders."
Stronach believes in ownership from within a company.
He offers profit sharing to employees, stock ownership and a minimum level of spending on research and development.
But his real genius was in building the company. In the early 1980s, Magna expanded by accepting contracts to design and build the interiors of Chrysler cars. The company proved to be a pioneer in the outsourcing of interior modules and continued to work for Chrysler. It also supplied the electrical systems for the Mini Cooper, for example.
And despite never building and selling its own cars, Magna assembles the Aston Martin Rapide in Austria and the Mini Countryman. Not that Stronach hasn't tried to be a car company all his own.
When Chrysler was up for grabs from DaimlerChrysler in 2007, he tried (unsuccessfully) to acquire Chrysler. The deal fell through when DaimlerChrysler executives became nervous over the involvement of a Russian billionaire in the deal with Stronach. Chrysler was sold to Cerberus Capital Management for about $7.4 billion and Stronach just moved on.
In his private time, Stronach prefers to visit some of his country castles (he has owned a few), ride on his Florida-based yacht and oversee the horses at his operation at Magna's Aurora, Canada, headquarters where there's an auto-parts plant, a golf course and riding stables.
His imperial style still riles shareholders. His wealth and ventures into new territory still makes him a topic of discussion. But he is unique. Of that there is little doubt.
Maybe some day he'll run for mayor, but that really wouldn't be the Stronach way. Founding a new political party in Austria this fall where he has called for an "intellectual revolution"? Now, that would be Stronach's way.