Chrysler CEO may quit
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November 14, 2000: 11:55 a.m. ET
German-American carmaker may name German trucks chief as successor
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NEW YORK (CNNfn) - James Holden, president and chief executive of Chrysler Group and one of the few North Americans left in the company's leadership, is set to step down this week to be replaced by the head of German parent DaimlerChrysler's truck and bus division, according to a source familiar with the situation.
Dieter Zetsche, a member of DaimlerChrysler's management board and head of its commercial vehicles unit, is set to step in at the U.S. operation, the Detroit News reported Tuesday, following a disappointing quarter at the Chrysler unit. An industry source confirmed the report was correct and told CNNfn.com DaimlerChrysler's supervisory board is expected to hold an extraordinary meeting Friday.
A DaimlerChrysler spokesman declined to comment. The shake-up would mark the removal of one of the last vestiges of North American control at DaimlerChrysler. The company that emerged from the $38 billion buyout of the No. 3 U.S. carmaker by Germany's Daimler-Benz AG in 1998 was supposed to be controlled from both Stuttgart, Germany, and Chrysler's suburban Detroit headquarters. But Canadian Holden's departure apparently will leave only two North American executives, both executive vice presidents, on the 11-member executive board.
Thomas Stallkamp, a 19-year Chrysler veteran who was widely credited with helping turn the company around before the merger, announced his departure as president of DaimlerChrysler in September 1999. Robert Eaton, who was co-chairman of the company and who helped negotiate the merger, retired in March.
Thomas Gale, executive vice president in charge of product development and design who was credited with innovative design advances at Chrysler, announced his departure in September, the same day DaimlerChrysler warned of poor results at the Chrysler unit.
Chrysler, the U.S. arm of the transatlantic automaker, recently reported a loss of 579 million ($498 million) in the third quarter, and pressure had been mounting on Holden to stem the red ink.
While industry-wide auto sales have been slowing, this generally has been a boom time of record sales in North America for automakers, and Chrysler's results have badly trailed the American and Japanese-based automakers selling in the market.
DaimlerChrysler blamed rising incentives in the North American market for the Chrysler unit's woes, although the company said it expects the division to be in the black in the fourth quarter.
Holden, 49, was educated in the United States and went to work in the auto industry with a job at Ford Motor Co. in 1973. He joined Chrysler in 1981 as fleet development manager in truck operations. His positions included executive vice president, sales and marketing and general manager for minivan operations, before he was named president last October.
Turkish-born Zetsche joined Daimler-Benz in 1976 and became chief engineer of its commercial vehicle division in 1981. DaimlerChrysler is the world's largest maker of heavy trucks. During his tenure with the company he also has been in charge of the sales division for the Mercedes-Benz and micro "smart" makes, as well as sales of all makes in Europe, Africa, Asia and Australia/Pacific.
Shares of DaimlerChrysler gained 1.4 euros to 55.10 euros in afternoon trading in Frankfurt, while American depositary receipts of DaimlerChrysler (DCX: Research, Estimates) gained 27 cents to $46.66 in U.S. trading.
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