German Executives Consolidate Control Over DaimlerChrysler

DaimlerChrysler, the product of a German-American industrial marriage, formally declared itself a “single company” Friday in announcing the elimination of its post-merger transition team and the streamlining of its 17-member management board.

Both actions appeared to consolidate German control over the new company, formed last year through a buyout of America’s Chrysler Corp. by Daimler-Benz, Germany’s largest industrial power.

As expected, the company is losing its second-highest-ranking American, Thomas Stallkamp, the president of DaimlerChrysler’s U.S. operations, who headed the transition team and who also held a seat on the management board. Stallkamp’s retirement becomes effective Dec. 31.

DaimlerChrysler Co-Chairman Robert Eaton, the company’s highest-ranking American executive, is scheduled to leave his job by 2001. Eaton previously served as chairman of Chrysler.

Eaton, in a Friday teleconference with reporters, dismissed talk of a ruinous rift between the company’s German and American leaders.

“There is no rift,” Eaton said. “This isn’t a German company or an American company. It’s a single company dedicated to being the No. 1 automotive and transportation company in the world.”

The problem, Eaton said, is that DaimlerChrysler failed to maintain adequate communication with its employees and the investment community in the rush of trying to complete the transition from two companies to a fully functioning single corporation. That communication gap led to a lot of “unfortunate speculation” that depressed both employee morale and stock values, Eaton said.

Stallkamp, who sometimes was publicly at odds with DaimlerChrysler’s German Co-Chairman, Juergen Schrempp, was similarly conciliatory Friday in his remarks to the company’s U.S. employees.

“I’m concerned that the press will highlight some of the more emotional aspects of my decision, especially over what they think is a rift in the German-American relationship,” he said about his resignation.

“The truth is I have, and expect to continue, excellent relationships with Juergen and with other members of the management board in Stuttgart,” where DaimlerChrysler is incorporated, Stallkamp said.

Stallkamp conceded that some “issues” arose “as a result of different styles or corporate cultures.” But they “have been worked out, and will be worked out in the future, because they are not the result of personalities or national differences,” he said.

“At my age and position, this is the best time for me to make a change and to take advantage of new opportunities,” Stallkamp said.

The other American leaving the board is Theodor Cunningham, who will become executive vice president in charge of marketing for DaimlerChrysler’s Dodge, Jeep, Plymouth and Chrysler vehicle groups.

In the United States, DaimlerChrysler’s stock fell 24% in the past three months amid speculation that the merger was going poorly.

DaimlerChrysler shares rose $2.13 to $68.38 on the New York Stock Exchange.