The Zastava Koral (Serbian Cyrillic: Застава Корал), also known simply as the Yugo, is a subcompact car built by the Zastava corporation. The first Yugo 45 was handmade on 2 October 1978.
Because of no major changes to the body or the drive train of the car, it is very easy to pinpoint the year of manufacture of the car. Early 1980~1985 models featured butterfly opening windows, round side indicators, only a single set of taillights on each side of the car, no rear defroster, and usually a black interior with a black dashboard, and many metal trim pieces such as window crank handles and door handles. Since around 1985 cars got much nicer seats, blue or brown dashboard, a two set taillights on each side, square side signals, rear defroster, redesigned instrument cluster and butterfly windows that didn't open.
Zastava was founded as an arms manufacturer in 1853. By the late 1930s the company had expanded into automobile production supplying Ford designed trucks to the Yugoslav Army. Vehicle production continued until 1941 when World War II reached Yugoslavia. Following the war Zastava was permitted to produce Jeeps under license from Willys-Overland until production was halted in the early 1950s.
The first passenger models were produced on 26 August 1953 using designs licensed by Fiat of Turin. The first model designed by Zastava was a sedan called the Milletrecento ("one thousand three hundred") powered by a 1300 cc engine. Some of the most successful models were those based on the Fiat 128 model, marketed under different names: Zastava 101, Zastava 128, Zastava 311, Zastava Skala, etc.
Zastava continued to produce vehicles for the Yugoslav and European markets until exports were limited by sanctions imposed by the United Nations in the 1990s. In 1984, automobile entrepreneur Malcolm Bricklin tested the U.S. market for Zastava vehicles, now branded as Yugo. As a result, in mid-1986, Yugo America began selling cars at a starting price of $3,990 for the entry-level GV ("Great Value") hatchback equipped with the 1100 cc overhead-cam five-main-bearing engine and four-speed manual transmission. The similar GVL offered a plusher interior, but the sporty top-line GVX was powered by the 1300 cc engine mated to a five-speed manual transmission, and included as standard equipment a number of deluxe features such as a ground-effects package, alloy wheels and rally lights. However, even though the GVX was billed as an upscale, sporty version of the base GV, it went from 0-60 mph in 13.56 seconds, just a half a second faster than the GV. When the political instability in Yugoslavia intensified in early 1992, Zastava was forced to stop exports.
In the United States
International Automobile Importers (IAI) was the company founded by Malcolm Bricklin to import the X1/9 and 2000 Spider after Fiat halted their manufacture. Bertone and Pininfarina carried on production under their own names and Bricklin's IAI took over their American importation. Bricklin wanted to import additional brands, and international dealmaker Armand Hammer had been asked by the Yugoslavs to identify business areas in which they could generate exports to bolster their economy. Hammer thought the idea of exporting the small cars made in Kragujevac, Serbia, by Zavodi Crvena Zastava would be viable. Zastava had, since the mid-19th century, been a quality armaments producer and sponsored its own museum.
As Zastava celebrated its 100th anniversary, it started producing vehicles made under license from Fiat, just across the Adriatic Sea. For three decades it produced the rear-engined 600 and the 101, a bustle-backed version of Fiat's 128. On its own initiative in 1980, Zastava introduced its Jugo or Yugo model which, though still using Fiat 128-type power train and underpinnings, was an update of the Fiat 127. Styled in Turin, the two-door hatchback's lines were reminiscent of the original VW Golf or VW Rabbit. Zastava was already exporting its new offering to other Eastern European markets, installing the bigger 128 overhead-cam engine for a top speed of 90 mph (145 km/h).
In 1982 US Enterpreneur Miro Kefurt (also responsible for the Oka NEV ZEV) contacted Zastava in Kragujevac (ZCZ-Zavodi Crvena Zastava) with an idea to export the Yugo 45 to the United States. The vehicles were to be renamed Yugo GV for the US market and YugoCars, Inc. was formed in Sun Valley, California by Kefurt and Ray Burns. The proposal required approval by FIAT in Italy due to existing restrictions that were in effect in FIAT — ZASTAVA collaboration agreements.
The first three Yugo vehicles (Red, White & Blue) were introduced to the American public at the Greater Los Angeles Auto Show in May 1984 held at the Los Angeles Convention Center. The car was promoted with a 10 year /100,000 mile warranty, free maintenance and a price of only $4,500 - front page articles about the Yugo appeared in the Los Angeles Times (Business Section), New York Times, and The National Enquirer. However, problems soon arose as one car was sent to the California Air Research Board (CARB) for emissions testing - it failed abysmally. The Yugo needed lots of reengineering, and with no help forthcoming from Zastava, Kefurt was in a problematic situation.
Reportedly, Malcolm Bricklin attended the Los Angeles Auto Expo Show and while the show was still in progress flew to Yugoslavia to "seal the deal" to import the Yugo to the United States himself. Kefurt and YugoCars, Inc. however already held the exclusive import contract for 5,000 vehicles for the 1985 model year to be sold in California only and the California Certification was already in progress. In November 1984 the marketing rights were sold by YugoCars, Inc to International Automobile Importers (IAI) for $50,000 ($10 per car). Additionally, Miro Kefurt obtained exclusive dealer franchise from IAI to sell the BERTONE X1/9 in North Hollywood, California. Both companies, YugoCars and IAI, were quite satisfied with this arrangement.
YugoCars, Inc had intended to fit their YUGO 45 with the 903 cc four (45 HP) with a ZEUNA catalytic converter and Lambda feed back - planned gas mileage was 42 to 45 MPG at 70 mph, the emission system was largely identical to the one used on FIAT/BERTONE X1/9 since the 1980 model year. In the meanwhile (late 1983), Zastava had added a version called the Yugo 55, powered by the bigger engine also used in the 101/128. IAI's Tony Ciminera preferred using this larger, 1,100 cc engine (55 HP) with air-injection and a fuel economy in the 30 MPG range. Thus equipped it was faster and more able to keep up on American freeways, but even so, with an 86 mph (138 km/h) top speed, it was the slowest car sold in the US.
Setting up Yugo America to import the car, Bricklin assigned Bill Prior to sort out the distribution and Tony "Hurricane" Ciminera to fine-tune the Yugo for US markets. Ciminera carried out a bumper-to-bumper audit that resulted in more than 500 changes to meet the needs of the American market, including the safety and emissions improvements that US laws demanded. The vast Yugo facility was patterned after the Fiat factories of the early 1950s and employed 50,000, divided among 85 basic associated labor organizations and 25 work committees. For American production models, a separate assembly line was built with handpicked elite staff earning extra pay ($1.23 per hour extra), building Yugos destined for the New World. The first shift began at 6:00 in the morning and after an eight-hour day many employees left for their second jobs in other workplaces.
The chief engineer and head of Zastava's Research and Development Institute was Zdravko Menjak, who responded to the many changes needed to qualify the car for sale in the West. Bricklin had his own people at the plant to monitor the effort, constantly stressing the need for high quality. A team of British quality experts sent a cadre to Kragujevac to study the factory and recommend improvements.
At first, five models of Yugo were sold in the United States for the 1987 model year: the basic entry-level $3,990 GV (for "Great Value"), GVC with Glass Sunroof, the nearly identical GVL and GVS with minor trim and upholstery upgrades, and the race-inspired GVX with the 1300 cc engine, five-speed manual transmission and standard equipment including a plush interior, ground-effects package, alloy wheels, rally lights and Centre High Mount Stop Lamp. The Cabrio convertible was introduced in 1988.
Toward the later 1980s an automatic transmission was being sourced from Renault and a larger model (named the "Florida") had been styled by Giorgio Giugiaro and was in the early manufacturing stages. With communism's collapse, however, Yugoslavia began to unravel.
In the UK
Zastava (GB) LTD set up its headquarters at Reading in 1981 and the first cars seen by British motorists were the 1100/1300 series in the autumn of that year, badged as Zastava ZLC (5 door) and Zastava ZLM (3 door). These cars were based upon the FIAT 128 which had been voted European car of the year in 1969. The Kragujevac factory produced faithful copies of the 128 saloon, known as the Zastava 128 (Osmica) and then from 1971 also began production of the Zastava 101. The legendary “Stojadin” was a FIAT 128 with a re-designed rear which was available in 3 and 5 door hatchback versions. In 1982-3 as sales slowly improved, Zastava (GB) LTD introduced special trim levels in the form of the “Mediteran” and the“Caribbean”. The UK market was the only market catered for with Right Hand Drive versions.
By the time the first British users were getting used to their new Yugoslav machines, attention in Yugoslavia had moved away from the Stojadin towards the new “Yugo” series which began production in October 1980 and appeared on British roads from 1983 onward. The “Type 102” answered a call for a small, economical family car and was based mechanically on Fiat’s 127 hatchback. The styling of the car also owed much to the contemporary small Italian Autobianchi Abarth, which was never available in the UK.
The “Type 102” morphed into the early production Yugo 45 with a 903 cc engine, later into the 55 with a 1,116 cc engine and then the more powerful 65 fitted with a 1,301 cc engine also became available on the UK market. The new Yugo competed with indigenous cars such as the Austin Mini-Metro and Ford Fiesta MK1/MK2, captive imports such as the Vauxhall Nova (Opel Corsa A), as well as French models like the Citroën Visa and Talbot Samba.
In 1984 only, Zastava (GB) LTD imported small numbers of the Zastava 128. After that, with the company’s branding altered to “Yugo Cars”, relegating the Zastava name to the small print, Zastava (GB) LTD concentrated on selling the 101 range, branded as Yugo 311/313/511/513, and the 45/55/65 series. The cars sold steadily throughout the decade and even though they managed to avoid the dreadful reviews reserved for Lada and FSO, commentators in the British motoring press were rarely more than lukewarm in their praise of the car - A headline from 1986 read “The Yugo 55 is a good small car, but would you be seen in one?” Brand snobbery in the UK was just as prominent then as it is now.
The Yugo was vigorously marketed in the late 1980s as a car that would fit into everybody's life, providing basic economical and reliable transportation along the lines of the Volkswagen Beetle and the earlier Ford Model T. The car was promoted as a uniquely affordable new vehicle — providing an option for buyers who would otherwise have chosen a used vehicle — and as a reliable second car for wealthier buyers. The Yugo carried the tagline "Everybody Needs A Yugo Sometime." This marketing appealed successfully to its target market of low-budget new car buyers, as well as wealthier people looking for an affordable second or third car. A popular ad included the 39-90 campaign, a play on the $3,990 price of the car.