Bob Nardelli, Chrysler’s chairman and chief executive who was once a poster-child for excessive executive compensation, will leave the Detroit carmaker with nothing.
“I’ll pick up my pencil and walk out the door”, Mr Nardelli said on Thursday, after announcing that he will step down once Chrysler completes its court-supervised restructuring and its alliance with Italy’s Fiat.
He noted that he had no contract, change of control provision or golden parachute to grease his departure.
Mr Nardelli, who turns 61 next month, caused an uproar in his former job as chief executive of Home Depot, the Atlanta-based hardware chain, taking home $32m in his final year with the company, plus a $210m severance package. He took only a nominal salary at Chrysler.
Cerberus Capital Management installed Mr Nardelli at Chrysler’s helm shortly after taking control of the carmaker from Germany’s Daimler in August 2007.
He replaced Tom LaSorda, who joined Chrysler from General Motors in 2000. Mr LaSorda stayed on under Cerberus as joint president and vice-chairman, but said on Thursday that after 32 years in the industry, he would retire, probably before the partnership with Fiat is consummated.
Jim Press, 62, the other vice-chairman who previously headed Toyota’s US operations, indicated that he planned to stay on.
Chrysler’s new board will choose Mr Nardelli’s successor, with Fiat’s approval.
The board will comprise nine members, six of whom will be chosen by the US government and three by Fiat. One will be a Fiat employee. The board will name a chairman.
Fiat will initially have a 20 per cent stake in the company, but this could rise to 35 per cent as Chrysler pays off its government loans. The United Auto Workers union, through a union-managed healthcare fund, will be the majority owner, with 55 per cent. The balance will be held by the US government.
Mr Nardelli, who made his name turning around General Electric’s power systems division, said that Cerberus had asked him to stay on as an adviser.
Reflecting on his tumultuous 20-month stint at Chrysler, he said that “for sure, it’s been exciting”. His biggest disappointment, he added, was that “we haven’t been able to soldier our way through this thing”.
An avid Nascar fan, Mr Nardelli said that Chrysler had “run out of laps” after its final pit stop due to the unprecedented slump in the US new-vehicle market.