Chrysler Expected to Tap GM Official to Succeed Iacocca : Autos: The appointment of Robert J. Eaton, president of General Motors’ operations in Europe, appears likely to be announced today.
Chrysler Chairman Lee A. Iacocca, in a repudiation of his top lieutenant, is expected today to announce the recruitment of a highly regarded General Motors executive to succeed him as chief executive.
Robert J. Eaton, 52, an up-from-the-ranks auto engineer who is president of GM’s highly profitable European subsidiary, would take over day-to-day control at the end of the year, when the 67-year-old Iacocca is to retire.
The selection will cap a long, awkward process in which the names of half a dozen outside candidates surfaced as Iacocca scrambled for an alternative to Robert A. Lutz, 60, Chrysler’s popular president.
Company officials refused to comment late Sunday other than to say that Iacocca will preside at a news conference today. But they didn’t deny a report in today’s New York Times that the choice was Eaton.
The fate of Lutz and the question of whether Eaton would hold both the president and CEO titles remained unclear. It is assumed at Chrysler that Lutz would leave if anyone were installed above him. Iacocca is expected to remain chairman of the board.
Some analysts and company officials fear that the selection of an outsider such as Eaton would anger designers and engineers and disrupt an encouraging flow of new cars and trucks developed under Lutz.
Though Chrysler lost $795 million last year, it is regarded as in a good position to exploit an economic recovery because of a new Jeep and a widely praised line of mid-sized cars due out this year. Some industry observers believe that Chrysler has fundamentally changed for the better.
Lutz’s role in the new vehicles and in forging the innovative ways they were designed and engineered led many within Chrysler and on Wall Street to favor him. But his strong will clashed repeatedly with Iacocca’s, colleagues said, and some considered his car-buff background too narrow.
Meanwhile, the lack of an obvious successor and Iacocca’s apparent reluctance to give up control was causing uncertainty. The final choice was made in New York on Saturday as board members convened in an urgent meeting, apparently bowing to Iacocca’s wishes despite the backing of Lutz by some.
Eaton spent many years as an engineer at Chevrolet and Oldsmobile, where he was affiliated with numerous small-car projects. He also played key early roles in GM’s current electric-car program and Saturn, the company’s new small-car subsidiary.
He took over at GM of Europe--also a training ground for GM Chairman Robert C. Stempel--in 1988 and has been presiding over a major expansion and record profits that stood in sharp contrast to GM’s woes in North America.
GM of Europe, which itself is roughly the size of Chrysler, earned about $1.8 billion last year while the corporation as a whole was losing $4.5 billion.
