Monday, September 10, 2007

Chrysler's plan: Press for success


Bradford Wernle and Mark Rechtin
Automotive News
September 10, 2007 - 12:01 am EST What is it about Jim Press that sends dealers and colleagues into rapture at the very mention of his name?

What you get are tales of the guy's phenomenal attention to detail - and to dealers. That's likely why Chrysler CEO Bob Nardelli hired Toyota's top man in North America as vice chairman and president. Press, 60, will run North American and international sales, global marketing, product strategy, and service and parts.

By bringing Press to Chrysler, Nardelli gets the industry's supreme dealer guy - by reputation, at least. He's a relentless executive who harps endlessly on the importance of good relations with the retail network.

During business trips, Press was famous for aborting jaunts to the airport by suddenly swerving into a Toyota dealership. His first stop was never the general manager's office. Instead he'd make a beeline to the service drive, to chat up technicians and find out what really was going on with his company's cars.

Above all, he's a listener, and Chrysler's demoralized dealers say it has been years since anyone from headquarters has really sat down and listened to their concerns.

Former Chrysler CEO Tom LaSorda, now vice chairman and president, tried to repair relations last December. He fired the unpopular Joe Eberhardt as head of global sales and cut production to relieve the bloated inventories dragging dealers down. But much remains to be done.

Car guy, too

Press also must devise a product plan that will bring customers back into showrooms. Dealers think Press can handle all of the above.

Though not an engineer, he is known to immerse himself in the technical details of vehicles. He can carry himself in detailed conversations with product planners, engineers and designers.

Last year Press was named COO of Toyota Motor North America. This year he was the first American appointed to Toyota Motor Corp.'s board. But in his new position in New York, Press mostly dealt with bureaucrats and Wall Street. For such a hard-charging executive, famous for a punishing work schedule, Press may have felt underutilized, said several Toyota sources.

"He could see a finish line on his career at Toyota, and Jim's not a guy who's going to retire and goof off on his boat," said a source.

After graduating from Pittsburg State (Kan.), Press worked for two years at Ford Motor Co., mostly in the Portland, Ore., region. Press spent most of his career in Los Angeles, but he is no stranger to Detroit. He is a board member of the College for Creative Studies and the Detroit Area Council of the Boy Scouts of America. He also is a member of the Detroit Athletic Club.

Culture change

Chrysler's dealer culture is in for an enormous change, says Earl Hesterberg, chairman of Group 1 Automotive Inc., the nation's fourth-largest public dealer group.

"I still haven't met Tom LaSorda," says Hesterberg. "But I guarantee you by the end of the day tomorrow I'll hear from Jim Press."

Hesterberg suggests that Press could start by dropping the volume performance allowance, an incentive that rewards some dealers for hitting sales targets set by the factory. Dealers complain the incentive rewards some dealers and penalizes others, and a de facto two-tier price system.

"That's the most dealer-unfriendly, controversial, corrosive approach that any of the manufacturers have today," said Hesterberg. "There's a variety of things that have created a lot of mistrust in the dealer network. I don't think they have near the energy, loyalty or motivation Toyota dealers have had for years."

Dealers complain that their regional sales offices have been plagued by high turnover and lack of experience. All that can change under Press, says Hesterberg: "He can have an impact on the motivation of the dealer network almost immediately."

Matching his Toyota successes won't be easy. Ed Parker, owner of Champion Chrysler-Jeep in Independence, Mo., said it's one thing for Press to sell highly desirable Toyota and Lexus vehicles and quite another to move Chryslers, Dodges and Jeeps that require large incentives.

But industry peers say that if anyone can do these things, Press can.

"I have always been surprised that the domestics never recruit at Toyota, Nissan or Honda," said Yale Gieszl, who was Press' predecessor as executive vice president of Toyota Motor Sales U.S.A. Inc. "This shows Chrysler is dedicated to making some changes."

Mike Jackson, chairman of AutoNation Inc., the nation's largest dealer group and one of the most vociferous critics of Chrysler's business practices, called Press a "transformational executive."

"The biggest challenge for Chrysler is to reinvent its business from factory-driven push to market-driven pull," said Jackson. "That requires a complete reinvention of its business model, and nobody understands that better than Press."

No comments: