Chrysler's Appeal to Old Auto Guys
The report over the weekend that former Chrysler COO Wolfgang Bernhard has joined Cerberus Capital as an advisor as that firm pursues buying Chrysler shows the value of the beleaguered American automaker. For all it's problems- and there are numerous ones including a reported $18 Billion in legacy costs- Chrysler is still an attractive asset. It's the 4th largest automaker in the world's largest market. It's Jeep brand is a globally recognized brand with growth potential-especially in China. And while Chrysler is truck heavy as a manufacturer, it's Ram line has 18% of the U.S. market. In other words, Chrysler has some real potential.
Bernhard knows this.
While restructuring Chrysler in 2001 as Dieter Zetsche's right hand man, Bernhard was often portrayed by the media as the "bad guy" who implemented the cost cuts. True, he has the point person behind many of the cutbacks, but he also did so much more. Bernhard was also a driving force in pushing Chrysler to pump out more new models with aggressive designs. Some, like the 300C and Charger, worked. Others, like the Pacifica SUV, failed. But the company was moving aggressively.
That's what Chrysler needs to do again, regardless of whether it's sold or stays with Daimler. There is great talent at Chrysler, especially with designers like Ralph Gilles. If the right moves are made to bring down Chrysler's costs, it could soar again. Wolfgang knows that, and so do the people at Cerberus Capital.
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