Chrysler names Robert Nardelli as new CEO

[Flybrian]

Nardelli, Ex-Home Depot, In At Chrysler
New CEO will take over, LaSorda president

by Paul A. Eisenstein | (2007-08-06) | Link to Original Article @ TCC

He's used to getting some big payouts, but just how much Chrysler's new CEO will be taking home from his assignment in Detroit is apparently going to remain a top secret.

Declaring himself "very impressed" with what he's found at Chrysler, former General Electric and Home Depot executive Robert Nardelli met with reporters at the automaker's sprawling headquarters, in the suburb of Auburn Hills, on Monday. It marked the official change in ownership, as the private equity firm, Cerberus Capital Management, formally took control of an 80.1-percent stake, with Chrysler's former German partner, to be renamed Daimler AG, retaining a minority 19.9-percent share.

The 59-year-old Nardelli's appointment by Cerberus came as a surprise within the automotive community which, until this weekend, had expected Cerberus to turn to Chrysler's one-time number two executive, the German Wolfgang Bernhard. It remains unclear why Bernhard will not assume the post, especially after serving as an advisor to Cerberus during its purchase of Chrysler, but insiders suggest there have been contractual problems posed by Bernhard's most recent employer, Volkswagen AG. The Wall Street Journal reported earlier that Bernhard declined due to family reasons.

In his new position, Nardelli takes the title previously held by Tom LaSorda. The Canadian-born LaSorda now becomes Chrysler president. Both men insisted they were pleased by that executive "partnership," LaSorda suggesting it is "more about being engaged with one another, rather than seeing who's first and who's second" in command.

There's little doubt both executives, along with the rest of the "new" Chrysler team will have a lot to engage with. With sales and market share plunging, LaSorda launched an aggressive turnaround plan early this year, calling for still more cuts in production capacity and employment - which now stands at 87,000 hourly and salaried workers.

The automaker is pushing for a number of concessions from the union side of its workforce. Last month, Chrysler, like its Big Three rivals, General Motors and Ford, returned to the bargaining table with the United Auto Workers; but there is concern that a controversy continuing to swirl around Nardelli could become a red flag for the UAW.

He took a compensation package of $210 million when leaving his CEO post at Home Depot last year, inflaming shareholders and employees alike who had watched the once-high-flying retailer stumble in the marketplace.

Asked if that might be a problem for the UAW, Nardelli said, "I hope not. The last thing I would want to be at the new Chrysler is a distraction." The executive added that the topic had indeed come up during an otherwise constructive conversation with UAW President Ron Gettelfinger.

Notably, "Tom has had and will continue to have primary interface, responsibility and authority of working closely with UAW," said Nardelli.

Despite aggressive questioning, Nardelli refused to disclose details of his Chrysler compensation plan. As a private equity firm, Cerberus is not required to report such details. But publisher reports suggest the former GE superstar may take a minimal $1 annual salary and then receive a large bonus package based on Chrysler's future performance.

The automaker lost $680 million last year and after sorting through the various details of their agreement, DaimlerChrysler effectively paid more than $1 billion to Cerberus to take over its 80.1-percent stake in the U.S. operation.

While Nardelli took pains to praise the LaSorda turnaround plan, he did not formally and completely rule out the possible need for further cuts to both speed up and slim down Chrysler.

But the new CEO also made clear that it will be critical for Chrysler to focus on the customer, not just try to cut costs. "The most important thing," said Nardelli, "is to have good-looking designs. Then you have to make sure the cars you're building are of the highest quality and reliability."

Where those products will come from remains to be seen. At several points during the news conference, LaSorda praised the work being done at Chrysler plants in the U.S. and Canada. But he also noted that the automaker recently entered a joint venture with the Chinese maker, Chery, which will produce a line of small cars for sale under the Chrysler nameplate. Both executives stressed that they'll be looking for similar deals, especially as they expand into emerging markets, such as China and Russia.

[regfootball]

ah, i get it now. he was hired to bust the union.

[C.H.U.D.]

As a guy that worked for Uncle Bob, I can say that customer service and employee morale are headed down the tubes.

I wonder if they will take "Bob Bucks" as down payment on a Magnum SRT8 (not that it matters, I never got any when they were still around).

[RJB]

This article was my whole point in another topic in this section, this idiot is only going to pillage Chrysler for his benefit. This only proves Bob is going to ruin Chrysler : But the new CEO also made clear that it will be critical for Chrysler to focus on the customer, not just try to cut costs. "The most important thing," said Nardelli, "is to have good-looking designs. Then you have to make sure the cars you're building are of the highest quality and reliability." That is thee most profound thing I have ever heard. Can you get anymore generic and make a more obvious statement?

Chrysler has now become a Viking funeral ship, wave bye bye as it heads out to sea on fire never to be seen again.

[jbartley]

Mistake i say, with a capital "M".