When Chrysler Group’s new sales supremo Jim Press was contemplating a move from Toyota after 37 years’ service, one factor that helped the decision was the extraordinary fact that only three employees globally in Toyota had more years’ service.
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“At Toyota I was in the sunset of my career; at Chrysler I’m in the sunrise of a career again,” he quipped.
When Press decided to jump ship from Toyota it sent a shock wave through the industry in the US. He was synonymous with Toyota’s relentless grab of market share there, largely at the expense of the Big Three.
Remarkably, he is the only ‘gaijin’, a non-Japanese, ever to make the boardroom of a Japanese-controlled car-company. He lived in Asia and has an Asian family.
So why give up all that he’d achieved in favour of a move, seen by some as risky, while Chrysler forges a new future under the ownership of private equity company Cerberus?
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By GlobalData“You know America has been good to me and this country has done a lot for me. Overall there’s one million people depending on this buyout working. That’s a challenge,” says Press, “and I don’t play golf or anything like that. My hobby is doing this: making and selling cars.”
Most observers agree that the challenge facing Chrysler Group is enormous. It has wobbled from boom to bust even under the wing of Daimler-Benz and Chrysler’s troubles have been manifold. It has botched run-outs, which cost its CEO his job, has consistently made too many cars, forcing it to discount large sales volumes to fleets with the consequent effect on the bottom line, and has struggled to spread its business away from NAFTA.
“I see this is in the culture of the company. I’ve come from a place where the strategic horizon was between 25 and 50 years to one where it is 25 to 50 days. The trouble is not the company, but the situation of the company.”
“I’m very confident of the coming year. We’ve got a solid, new structure, great cars and trucks and a strong plan. Remember, Chrysler was the only American car company that didn’t lose market share last year.”
Even Chrysler’s legendary reputation for creating knock-out new models has taken a dent in recent years and there are question marks over the quality of its vehicles and interiors, particularly those sold in Europe.
In model terms, Press wants to cut duplication and overlap in the ranges of the three brands, whose model line-ups expanded in the Daimler years with ‘badge-engineered’ variants of similar models. Think Dodge Nitro/Jeep Cherokee, Dodge Magnum/Chrysler 300C, for example.
The cash saved can be sunk into models that exploit market areas where the three brands have no models.
In brand terms Press vows to keep Chrysler and Dodge in the current positioning: Dodge the volume-brand tackling Chevrolet and Ford; Chrysler pitched against top-spec Fords and imports and some Buick and Mercury models. Jeep continues as the legendary 4×4 nameplate.
A persistent rumour at Detroit is that Chrysler needs to shore up its finances by selling off one of its three brands, most likely Jeep. “No,” says Press firmly.
Press, of course, isn’t in this alone. He’s one of three executives charged with fixing Chrysler, the others being the genial Tom LaSorda, Chrysler’s chief engineer, and chairman Bob Nardelli, the combative former Home Depot boss.
The three have made their mark already. Slow-selling models have been axed, inventory cut by 100,000 units and factory capacity reduced by 80,000 units, volume that supported discounted fleet sales.
Says Press: “We took out that capacity after discussing it for about seven minutes. In my old company that would have taken about seven months, which is right for that company, but it shows how the new Chrysler can be fast and flexible.”
That’s not the first time speed of decision-making has been listed as one of the devolved Chrysler’s strong points. In an earlier briefing, Nardelli stressed this point several times.
Press and Nardelli also like to emphasise the freedom they have to get on with running Chrysler Group free of the tyranny of quarterly financial reporting and shareholders, even with Cerberus running the show.
“We’ve been told by Cerberus just to get on running a successful car company and not give fixed targets like getting the company ready for sale by a certain time or anything like that,” said Press. “The aim is to take the company back to being a great American company again.
“Cerberus is an operating company. It’s very different. It operates 55 different companies, like Air Canada, and is staffed by 200 experts that provide operational assistance to managements.”
So what magic dust does Press think he can bring from Toyota to sprinkle on Chrysler’s recovery?
“The first is the confidence that the job can be done. That’s an important feeling. Just having some evidence of having been there and done things successfully.
“The second is to help the company focus on the customer. I think that really counts and the third is to make the dealers really feel like they can do the job. Don’t forget the dealers are really our only direct customers.”
The latter will be music to the ears of Chrysler’s US dealers, who felt unloved at various stages of Daimler’s ownership, most notably when the factory forced onto the network stock that it didn’t want. Indirectly that feud cost another senior exec his job.
There’s some upheaval coming for dealers, though, the plan being to streamline the network, creating more multi-brand Jeep/Dodge/Chrysler sites.
In many ways it seems Chrysler Group is not changing much. The basic strategy, brand positioning stays the same. But the manner in which that strategy is executed is going to be more dynamic with better decision-making, more-focused model range, more efficient manufacturing.
Let’s give the final word to Press: “One of the best things about coming to Chrysler is discovering that the reality is a lot better than the perception. The bones of the company are really pretty strong.”
Julian Rendell
