Now that Chrysler LLC has a new management team, what's next for the auto maker?
Industry analyst David Cole, chairman of the Center for Automotive Research, tells Ward's there are two likely scenarios: An initial public offering that would return the company from private to public ownership, or a strategic alliance with or sale to another auto maker.
In either case, the company must first prove it has put its financial house in order and has a sustainable business plan to produce solid profits, Cole says.
Chrysler officially came under control of Cerberus Capital Management LLC, a New York City-based private equity firm, last month. Cerberus named Robert Nardelli, one-time chairman and CEO of Home Depot, as Chrysler chairman and CEO. Nardelli previously served as a senior vice president of General Electric Co.
Tom LaSorda, previously Chrysler Group CEO, stays on as vice chairman and president.
“LaSorda basically will run the company,” Cole predicts. “Nardelli is responsible for the money; Cerberus puts emphasis on the money.”
Both men, however, will be on the line to get Chrysler's finances and products up to speed to make it attractive for an IPO or possible sale, Cole says. “A strategic buyer would want to see value, and would (thus) pay more,” he adds.
