ArvinMeritor will name a successor to CEO Larry Yost within a few weeks, company sources say. An executive recruitment firm has been hired to find a replacement of the 66-year-old Yost.
ArvinMeritor had decided to not announce his departure until a new CEO had been appointed.
Sources now say, however, that Yost will retire when a new chief executive is named. Yost led the failed attempt to gain control of Dana Corp. last year. He was expected to step down after the takeover attempt collapsed late last year after investors failed to buy into his vision.
ArvinMeritor’s share price fell 10% after the company announced poor quarterly results and the resignation of Yost’s chief operating officer and heir apparent, Terry O’Rourke.
The search for Yost’s successor is now going on and could be wrapped up before the end of February, sources said.
Meanwhile, Yost’s former target, Dana Corp. has hired General Motors Europe president Michael Burns as its new CEO, replacing Joe Magliochetti who died last September. SupplierBusiness.com recently reported that Burns was on a short list of candidates to become Dana’s CEO.
Burns is the latest in a series of car company executives to become chief executive of a major supplier. Former Mercedes-Benz executive Manfred Remmel is the new CEO of Magna Steyr; Ford executive Kathleen Ligocki took charge at Tower Automotive last year; and ex-Ford purchasing chief Carlos Mazzorin is in charge of Magna Donnelly. Former BMW product development head Wolfgang Ziebart is vice-chairman at Continental AG.
Thinking like an OEM
Dana needed a high profile chief executive to help demonstrate to Wall Street that its turnaround strategy is on track. But there are growing operating reasons to hire former car company executives — and not just ex-purchasing bosses.
The key strategies of the leading Tier 1s seem to be a replay of what the carmakers have been doing for the last decade – implementing better production systems, focusing on new product development processes, and managing their supplier base by reducing supplier numbers and looking to source more from low cost countries.
It has become increasingly important to get inside the heads of carmakers. Suppliers need to anticipate their wants and needs, especially in terms of bigger and more complex systems and modules that they are now outsourcing.
And purchasing departments have special feelings for one of their own now on the other side of the negotiating table.
Burns a known quantity
The appointment of Burns could give Dana a grace period with investors.
As a known quantity, Burns may have a few months to get his feet under the desk and bed down a strategy – and get over the dislocation that followed Dana’s floating off its aftermarket division late last year.
He has a good start position. The company has made progress in turning around in the last two years – at least in the eyes of some that know it well – such as Yost.
Burns is also well positioned to help Dana grow in Europe.
The 51-year-old failed to complete a turnaround at GM Europe, but did succeed in cutting the cost base.
He also has experience on the supplier side. Before taking the GM job, he led GM’s Delco Electronics unit and would have likely been the natural successor to Delphi chairman JT Battenberg had he still been in the job when Delphi was spun off.