Cerebus tapped former Home Depot CEO Robert Nardelli to become chairman-CEO of the now-private car company called Chrysler. Tom LaSorda, who told the automotive press just a few months ago he would remain president-CEO of Chrysler, drops the CEO title and becomes vice chairman and president, reporting to Mr. Nardelli.
Move was anticipated
Such a move was anticipated by company-watchers: Four of six experts interviewed by Advertising Age said in May they didn't expect Mr. LaSorda to remain Chrysler's leader for the long haul.
Cerebus also said Eric Ridenour, chief operating officer, decided to leave Chrysler "to pursue other opportunities," adding that position won't be filled.
Mr. Nardelli arrived as CEO of Home Depot in 2000 from General Electric Co. and within two years at the helm the big-box retailer reported some of its best earnings and sales growth in years, due to revamped stores, service and efforts to improve customer experiences.
During his six years, Home Depot's sales were up 99% and profits up 125%, but at the end of his tenure in January the stock price had lost 8% of its value. During the same period Lowe's, the No. 2 home-improvement chain, saw its stock rise 188%. Still, Mr. Nardelli departed with an exit package valued at more than $200 million.
Mr. Nardelli will draw no salary at Chrysler; his compensation instead is tied directly to the carmaker's equity performance, said Michelle Krebs, an editor of Edmunds.com. The auto-info website also predicted the new CEO would make changes quickly to turn around the company.
Ad blitz breaks today
Cerebus is introducing the "New Chrysler" name in a blitz today with print, internet and radio ads that show the automaker's past product, innovation and technology accomplishments and what can be expected in its next 100 years. The corporate ad campaign is scheduled to run in the U.S. through the end of August and elements of it will be used in Canada, Mexico and Puerto Rico.
Omnicom Group's BBDO, Detroit, handled the radio and print while sibling Organic, Bloomfield Hills, Mich., is handling the online ads.
"We have a bright future with the best showroom lineup ever, including the all-new Dodge Grand Caravan and Chrysler Town & Country minivans that will soon be arriving at dealerships," Steven Landry, exec VP-sales and marketing, service and parts in North America, said in a prepared statement.
Chrysler is in the midst of a recovery plan with an eye on returning to profitability by 2008. The carmaker is also changing its long-term business model, which includes a bigger global push and shift from big trucks and SUVs to smaller, more fuel-efficient vehicles.