Mitsubishi CEO Quits as Bailout Is Rejected
Rolf Eckrodt resigned Monday as chief executive and president of Mitsubishi Motors Corp., days after minority investor DaimlerChrysler announced that it wouldn’t spend more to finance the struggling Japanese company’s turnaround.
Mitsubishi Motors said that a replacement would be chosen soon, and that Keiichiro Hashimoto, chief financial officer, would be acting president until then.
The Tokyo-based automaker, which is burdened with billions of dollars in debt, plunging car sales and a spate of recalls, was dealt a serious blow by the U.S.-German automaker’s announcement Thursday that it would not provide a multibillion-dollar cash infusion as had been expected.
The German-born Eckrodt, formerly president of Adtranz, the rail systems unit of DaimlerChrysler, was sent in by DaimlerChrysler in 2001 to lead a turnaround at Mitsubishi Motors.
He had recently hinted he would step down.
He had been expected to make way for leadership that would carry out a revival plan with extra cash from DaimlerChrysler, which owns 37% of Mitsubishi Motors.
Eckrodt, 61, will retire from a 38-year career in the auto business although he will provide support for Mitsubishi Motors at the automaker’s request, the company said.
Eckrodt said he was stepping down because of DaimlerChrysler’s decision against financial support and the subsequent decision by the Mitsubishi group companies to hammer out a different revival plan.
Mitsubishi Heavy Industries owns 15% of the automaker, trading company Mitsubishi Corp. a 5% stake and Bank of Tokyo-Mitsubishi 3%.
DaimlerChrysler has not said what it will do with its stake in Mitsubishi Motors.
DaimlerChrysler Chief Financial Officer Manfred Gentz has said the two automakers’ joint projects in Chrysler, Smart and other passenger cars will continue.
But analysts say Mitsubishi Motors’ lagging sales probably will dip even further now and its chances for recovery are precarious because Mitsubishi companies are unlikely to have enough cash to fund a revival plan.
