COMMENT: Zetsche will restore positive thinking at DaimlerChrysler

Arjen Bongard is editor of Automotive News Europe. He is acting editor for Automobilwoche after Franz W. Rother left the company.

It was nearly five years ago that Dieter Zetsche, along with his second-in-command, Wolfgang Bernhard, moved from DaimlerChrysler's headquarters in Stuttgart, Germany, to Auburn Hills in Michigan, USA, to whip a crisis-rocked Chrysler group into shape.

The announcement alone struck fear and horror into the hearts of D/C's American employees.

Just two years after the 1998 merger of Daimler-Benz and Chrysler, the dynamic pair from Germany seemed rather like an occupying force.

Bernhard was quickly forced into the role of the bad guy who solved cost problems, cutting 26,000 jobs and trimming $10 billion from product plans. Zetsche, although he was also deeply involved in Chrysler's restructuring, transformed himself into an inspirational figure and the company's public face.

Zetsche's chummy management style and his efforts to win over American employees, suppliers, dealers and customers quickly paid off. The system worked, and Zetsche brought Chrysler a new, exciting portfolio of products. A competitive company returned to profitability.

At Chrysler, everything improved, and the greatest share of the success was attributed to Zetsche. The media dubbed him the "wonder weapon with the walrus mustache."

GM, Ford wanted Zetsche

Had Zetsche not been given the top job at DaimlerChrysler, he might soon have jumped ship. General Motors and Ford were thought to be after him. Now Zetsche will return triumphantly to Germany to take over the board chairmanship from Juergen Schrempp at the end of the year.

His task is to repeat his success in America, this time for the entire company.

Zetsche's homecoming not only marks the end of the Schrempp era, but also a fundamental change in the company culture at Germany's largest luxury-car manufacturer. That's because Zetsche's greatest achievement was the creation of a more positive culture and climate at Chrysler despite years of negative headlines.

Zetsche is a communicator who, unlike Schrempp, works hard to create a positive message and communicate it correctly, both internally and externally. And a positive company culture is precisely what DaimlerChrysler now needs.

After Schrempp survived a board rebellion in the spring of 2004, his leadership was less inspiring than ever. DaimlerChrysler's public image bore the stamp of corruption scandals, quality problems at Mercedes and the restructuring of the notoriously unsuccessful Smart brand. Schrempp's plans for a "world corporation" have foundered. It was evident that a comprehensive company leadership was lacking.

Zetsche will have his hands full, especially if he has to look for another replacement for Mercedes chief Eckhard Cordes. It is still too early to speculate about the new Zetsche era. In any case, immediate strategy changes aren't to be expected.

But DaimlerChrysler under Zetsche should be a happier place, where priorities are clearly set, where the American and German branches work well together, and where the chief executive, unlike his predecessor, sends out clearly positive signals.

Some of this may be wishful thinking. But the sudden rise in share prices this last week shows that even the international finance markets believe Zetsche will work the miracles that his predecessor had only promised.