Murtaugh: He's the right man for Asia

[Oracle of Delphi]

Alysha Webb

Automotive News

September 17, 2007 - 12:01 am EST

SHANGHAI — Chrysler LLC could not have made a better choice to head its Asia operations than Phil Murtaugh.

He is widely respected, has many years of China experience and played a major role in making General Motors a success in China.

But Chrysler management in Detroit will have to give him free rein to operate.

GM made a big mistake a couple of years ago when it diluted Murtaugh's decision-making authority.

Chrysler also will have to give him some help in the form of the right models to sell.

During his long run as GM's top man in China, which began in 1996, Murtaugh demonstrated a deep understanding of the local market. But he quit as CEO of GM China in April 2005 after the decision-making responsibility for the country was split three ways — among the company's China, Asia-Pacific and Detroit headquarters.

This month, Chrysler lured Murtaugh away from SAIC Motor Corp. of China, where he was vice president for overseas operations.

Murtaugh knows what kind of cars the Chinese want to buy. But will Chrysler have models that fit that description.

Murtaugh had built General Motors into a formidable competitor in China. One successful model followed another, and GM seemed sure to knock Volkswagen off its perch as market leader.

Now, GM's sales growth in China has slowed to just over 10 percent annually, while Volkswagen is resurgent.

Murtaugh knows what kind of cars the Chinese want to buy. But will Chrysler have models that fit that description?

Right now, it sells only one sedan in China, the Chrysler 300.

The smaller Sebring sedan is due out this year. Chrysler also plans to launch several vans.

Clearly, it needs more models, including smaller cars.

Chrysler has an agreement to develop small cars for export with China's Chery Automobile Co. But it won't be able to sell a Chrysler- or Dodge-badged version of a Chery model in China.

Chrysler CEO Bob Nardelli says the company needs 10 years to revamp its product line.

In the fast-moving China market, 10 years is an eternity. Murtaugh will have his work cut out for him.

[Oracle of Delphi]

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