Retiring Chrysler Vice Chairman Robert Lutz was part of a group that wanted to buy auto supplier New Venture Gear Inc. But Lutz, 66, who retires July 1, said a deal for the joint venture fell through. He is now considering other employment options.
'That didn't work out because of labor reasons,'
Lutz said last week. 'I was going to be part of the group (that wanted to buy it). I think we could have done a great job for job security and international expansion, and made the world's most successful four-wheel-drive and transfer case out of it.'
New Venture Gear can't think entrepreneurially while operating under its Chrysler Corp. and General Motors umbrella, Lutz said. Chrysler owns 64 percent of the company; GM has 36 percent.
The supplier has 70 percent of the U.S. market for transfer cases, the unit that transfers power to the second set of wheels in a 4wd vehicle. The company, based in Troy, Mich., also makes manual transmissions for trucks.
Lutz and other suitors were trying to buy a successful company that posted $1.4 billion in sales last year. The company has 5,000 workers, with plants in Syracuse, N.Y., and Muncie, Ind. Automotive News ranks it as the 26th-largest supplier of original equipment parts to North America.
In April, Chrysler and GM asked investment banker Morgan Stanley & Co. to find a buyer. But the plan was tabled after the proposed merger of Chrysler and Daimler-Benz AG was announced May 7.
A deal could fetch more than $800 million.
Fred Hubacker, president of New Venture Gear, did not say when a search for a buyer would resume. There are 'a good dozen' interested parties, he said. Hubacker does not see any insurmountable labor issues. 'If it were sold, the workers probably would not be under the national (UAW) agreement,' he said.
Lutz said he has other options. 'Doing nothing for a while, except the array of board memberships that I have, is fine,' Lutz said. 'There's the appeal of doing something educationally with a university or participating in some sort of automotive think tank. At this point, there's nothing concrete. I'm available basically for the full range of options, from super full-time work down to spend more time at home, meet my obligations to boards of various companies and spend more time with family, helicopters, airplanes and cars.'