Monday, August 13, 2007

Penske likes Nardelli appointment

Roger Penske

Brent Snavely
Automotive News
August 13, 2007 - 12:01 am EST

Roger Penske says he has known new Chrysler CEO Bob Nardelli for more than 20 years and once teamed with Nardelli in an attempt to acquire General Motors' locomotive division.

At the time, Nardelli was an executive for a division of agricultural equipment maker JI Case, which was then part of Tenneco Inc. GM waited until 2005 to sell its locomotive unit.

But Penske and Nardelli forged a friendship during his tenure at Case from 1988 to 1991 - one that continues today.

Nardelli's appointment generated wide-ranging debate last week because of his management style and his controversial exit earlier this year as CEO of Home Depot Inc. In January, he left the retailer with a $210 million severance payout.

But Penske endorsed Nardelli's appointment to head Chrysler, under the control of the private equity firm Cerberus Capital Management LP.

"I think it's a great opportunity for Chrysler and for Nardelli to team up with (Chrysler Vice Chairman and former CEO Tom) LaSorda," said Penske, an auto racing icon and chairman of Penske Corp., a private company with $18.9 billion in global sales. "Bob is a tireless worker."

At General Electric, Nardelli "was able to generate tremendous profitability in the plants," Penske said.

Penske was a member of Home Depot's board of directors from 2001 to 2005. At Home Depot, he said, "Nardelli took over a company that needed process, and it needed discipline and needed sourcing stability. He generated acquisitions in Mexico, and he also looked for line extensions."

Penske said he played no role in either Home Depot's selection of Nardelli in 2000 or Cerberus' decision to hire him. But Penske says he did call his old friend to offer his congratulations.

"I think that this is a chance for him to show people what he can do in a tough, tough market," he said. "I think he and LaSorda will be a good team."

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