Ah, yes, let the fun (and the firings and sell-offs) begin! Chrysler's new owner
, Cerberus, wasted no time in hiring a chief for the newly-private automaker. Robert Nardelli was named Chrysler's president and chairman, while long- time Chrysler chieftain Tom LaSorda (not the Dodgers baseball team ex-manager), a popular executive who many thought deserved the top title, will be president and vice-chairman. At least as long as he remains at the company.
And, according to the LOS ANGELES TIMES, Nardelli's pay package will be completely performance-based, to the point that he will receive compensation only if and when Chrysler returns to profitability.
Cerberus recently paid $7.4 billion for Chrysler; In May, 1998, Daimler paid $46 billion for Chrysler, in an attempt to merge the two companies' perceived strengths in larger and luxury cars (Daimler Benz) and fuel-efficient smaller cars (Chrysler); both companies were and are still strong in truck production.
Also, a merger of the companies' dealerships world-wide was seen as a possibility. Chrysler, Dodge and Jeep suddenly had access to the many Mercedes car and truck stores throughout the world; Daimler could sell new, smaller cars, developed with Chrysler's design and production help, through their huge world network and at the many Chrysler dealers in the US and Canada. The Mercedes-Swatch developed Smart car (photo below) might have been a good experiment for owner Daimler to sell at Dodge stores, for instance, but now they will be sold exclusively at dealerships owned by Roger Penske's "Penske Automotive Group", the second-largest auto dealer chain in the US.
After the merger, execs from both Daimler and Chrysler said that Mercedes parts would never be used on Chrysler products, and vice-versa; that pledge was broken almost immediately (Chrysler's Crossfire, for instance, is a thinly-veiled version of a small Mercedes convertible, and the Chrysler version comes with a manual convertible top, not the neat-o automatic one on the Benz).
What was the outcome of Daimler's purchase? Many key Chrysler executives, especially in manufacturing, quit the new company, and the combined market value of the two companies took only nine years to drop 50%, or $45 billion. The two might have done better had they simply shut their doors for those years and re-opened as the "new and improved Daimler-Chrysler!"
Nardelli is perhaps best-known to the general public for his being the chief exec at Home Depot, where his enormous pay package, including $210 million in a severance package when the Board of Directors essentially fired him, and his attempt to thwart union members, Home Depot stock shareholders and even his own top execs from speaking at the company's annual meeting, gave him a reputation near on a par with other recently-disgraced corporate executives.
Just yesterday (August 4th) it became official --- Chrysler Corporation once again became an American-owned company (as far as we know) and, perhaps more importantly to hundreds of thousands of Chrysler Corporation employees and retirees, and the families they support, it also moved off the world's stock exchanges into private ownership, where answers from management are legally few and far between. (Logo above -- That of Cerberus, whose name comes from ancient Greek, that of the four-headed dog which is said to guard the gates of hell. Sounds like a fun place to work, huh? Bet their holiday parties are a blast! Below, new Chrysler CEO Bob Nardelli, smiling, which he does often. Three guesses why ...)
And at Cerberus/Chrysler, Nardelli will not have to deal with those nasty little "shareholder meetings" and other things which, let's face it, only get in the way of "big boys" like Nardelli from making the real money; that is, firing employees, cutting back retirement and health care packages (even those already agreed upon by the company) and, ultimately, selling-off chunks of the company, getting rid of dealers who have been with the company for generations and focusing on increasing production and sales in India, China, Asia, Africa, eastern Europe and South America, until that flowing red ink starts to turn black ... if that ever happens.
We say "as far as we know" when referring to Chrysler's new American ownership, which is going to be heavily hyped in their advertising, because when all is said and done, we don't really know who owns Cerberus. The company can claim all their investors stepped off the Mayflower, but, legally, there is little which the company needs to make public. And least of all, they don't need to make Nardelli's pay package public (nor that of any other Cerberus/Chrysler exec) because it is now a privately-held outfit.
Nardelli becomes the second CEO of a Detroit Big Three operation to come from outside the industry. Ford hired a top executive from Boeing to run their North American operations, Alan Mulally. Ford indeed showed an unexpected profit in the last quarter, and big kudos to them. However, the announcement of the "recall which just won't end," that of various FoMoCo cars and trucks having cruise control systems which can catch fire, might take up all of that profit and a lot more.
they "mutually agreed" to the resignation, which took effect Tuesday. Under the terms of a separation agreement negotiated when he joined the company in 2000, Nardelli, 58, is to receive about $210 million in cash and stock options, including a $20 million severance payment and retirement benefits of $32 million." (end of Washington Post quote)
Here's how THE WASHINGTON POST covered the story of Nardelli's resignation from Home Depot in January, 2007:
"Robert L. Nardelli has abruptly resigned as chairman and chief executive of Home Depot, pocketing a lavish severance package and leaving shareholders with a stock that has languished even as sales have nearly doubled during his six-year tenure.
In a statement released yesterday (January 3, 2007), Home Depot's board of directors and Nardelli said
Sounds like just the kind of guy America's auto industry needs, huh? At the very least, he is not the kind of chief executive which unions, workers, retirees and even the white collar execs he may be firing by the (Dodge?) truckloads need in these times.
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