With the deal to buy Chrysler finalized on Friday, the new owner, Cerberus Capital Management LP, has moved quickly to appoint a chief executive from outside the automotive industry, but with extensive experience in corporate turnarounds. Robert Nardelli, who left as the head of Home Depot Inc. earlier this year with a highly public battle over his severance package, takes over as CEO of the new Chrysler LLC. He replaces veteran automotive industry executive Tom LaSorda, who will remain as president and report to Nardelli.
Cerberus paid $7.4 billion to acquire the number three U.S. automaker from DaimlerChrysler AG, which will be renamed Daimler AG. It will retain a 20% interest in Chrysler, and is expected to retain sourcing and marketing agreements with the newly independent company.
The appointment of Nardelli is seen as the opening move in a major restructuring as the new owners prepare to enter new contract negotiations with the United Auto Workers. The current contract expires on Sept. 14.
In his six years heading Home Depot, Nardelli combined job cuts and investments in new business systems that led to net-income growth but failed to move the company’s share prices. Before taking the top job at Home Depot, Nardelli was responsible for the GE Power Systems business units, growing revenues there by 75% over five years.In making the new CEO announcement, Cerberus also indicated that Chrysler’s chief operating officer Eric Ridenour would leave the company. Ridenour was responsible for Chrysler production and product planning.