DaimlerChrysler AG has announced that its embattled chief executive Juergen Schrempp will leave the company at the end of the year. Chrysler Group boss Dieter Zetsche will replace him.
DaimlerChrysler AG has announced that its embattled chief executive, Juergen Schrempp, will leave the company at the end of the year. Chrysler Group boss Dieter Zetsche will replace him.
As a result, Thomas LaSorda will replace Zetsche as Chrysler's chief executive at the beginning of next year, and Eric Ridenour will succeed LaSorda as chief operating officer of the US company. All three executives were named to the multinational's board of management on Thursday.
Schrempp has been widely criticised by investors because the company's stock price has lagged since the 1998 merger that created the company out of Daimler-Benz AG and Chrysler. DaimlerChrysler shares rose 7,7 per cent in trading on the Frankfurt stock exchange after the announcement of his retirement.
In April, Detroit-based motor industry commentator Jerry Flint speculated that DaimlerChrysler's decision to stop investment in Mitsubishi could spell "the beginning of the end for Schremmp".
At the time, CARtoday.com reported that DaimlerChrysler had decided not to participate in a rescue capital increase planned by Mitsubishi Motors because it could not agree to an acceptable deal with other shareholders in the Japanese manufacturer's group.
Flint said there would be fallout as a result of the DaimlerChrysler's move: "I suspect that the DaimlerChrysler board finally is getting sick of the global strategy of its own chief executive (Schremmp). His tactics led to massive investments in Chrysler (a takeover), in Mitsubishi and Hyundai.
"Schremmp's ambitious plans have stumbled badly, and the distractions have apparently hurt Mercedes-Benz, where the reputation of the German make's vehicles has dropped.
"I am not ready to say that Schremmp is being driven out of the company, but how much longer can he last?" Flint asked.
DaimlerChrysler on Thursday reported improved second-quarter earnings and a slight rise in sales. The manufacturer said its second-quarter earnings came to R5,9 billion (compared with the R4,6 billion reported in the corresponding period last year).
Schrempp has been with DaimlerChrysler for 44 years, and held a variety of management positions, including terms as head of Daimler-Benz operations in South Africa, the United States and in Germany, as well as 17 years as chairman of Daimler-Benz Aerospace and DaimlerChrysler.
He began his career as an apprentice mechanic with Daimler-Benz in 1961 and joined the company's headquarters in Stuttgart in 1967.