Robert Eaton, tight-lipped since he retired from DaimlerChrysler AG a year ago, ended his self-imposed silence last week. Eaton emphatically said he always envisioned DCX as a merger of equals with an integrated operating structure.
The ex-DCX chairman disputes the allegation of former co-chairman Juergen Schrempp that he shared Schrempp's original vision of Chrysler as an operating division within a corporation dominated by the former Daimler-Benz AG.
Eaton has been invisible since his early retirement in March 2000. He has been increasingly vilified in the Detroit media for having sold Chrysler, which is eliminating 26,000 jobs under its new German CEO.
'I want to make it very clear that I have not deceived anyone,' Eaton told Automotive News .
'I believed from the bottom of my heart that this was a merger of equals, and I believed that the combined company would be the strongest automotive company in the world.'
Eaton declined comment on what actually has happened since the merger.
Eaton and Schrempp served as co-chairmen of the combined DaimlerChrysler from its beginning in November 1998 until Eaton's retirement. But Schrempp dominated the more passive Eaton while Daimler-Benz executives took control of the management board and the Chrysler group was tucked in as a 23rd business unit of Daimler, not as an integrated part of a German-American company.
Red ink flows
Schrempp has been under tremendous pressure from shareholders since DaimlerChrysler shares lost more than half their value and especially since what had been a very profitable Chrysler group collapsed into nearly $2 billion in red ink the past two quarters.
One of Schrempp's problems stemmed from an interview he gave to the Financial Times in October. In that interview, he seemed to boast of deceiving the Chrysler people into thinking that the combine was to be a merger of equals and that Chrysler and Daimler-Benz would be inte-grated.
In that interview, Schrempp said: 'When we sat in New York (in the 1998 merger talks) we said, you know, I mean for psychological reasons we need as many Americans as Germans on the board of management. ... But it was clear to Bob Eaton and myself at the time this is what we call the start structure, and then we would move eventually to what we have today.' Today, only two Chrysler executives, purchasing chiefs Gary Valade and Tom Sidlik, remain on the management board. Schrempp said that without that deception, Chrysler would not have agreed to become a division of the German company.
Eaton's comments last week suggest that neither he nor other Chrysler executives shared any vision of a Daimler takeover or Chrysler's status as a division.
Former Chrysler President Tom Stallkamp's recollection supports Eaton. 'I honestly think he (Eaton) thought it could be a merger,' Stall-kamp told Automotive News. 'He was sincere that he wanted a plan for efficiencies' from combining the companies.
'We talked about people moving back and forth across the Atlantic,' Stallkamp said.
In September 1999, Eaton fired Stallkamp as president of the Chrysler group and replaced him with Chrysler sales boss Jim Holden. Last November, as Chrysler's stunning financial losses unfolded, Schrempp abruptly fired Holden and replaced him with Dieter Zetsche, the head of DaimlerChrysler's truck operations and a former engineering and sales chief of Mercedes-Benz cars.
It was the crowning blow in Chrysler's total takeover by the former Daimler-Benz.
Eaton's statement that he did not share a vision of Chrysler as a division adds ammunition to those who say Schrempp has lied consistently in his dealings with Chrysler, its employees and its shareholders.
American investor Kirk Kerkorian, DaimlerChrysler's third-largest share- holder after the acquisition, is suing DaimlerChrysler for $8 billion, alleging that Schrempp's claims of a merger of equals was fraudulent. He owned 4 percent of the company's stock when he sued in U.S. District Court in Delaware in November 2000. But reports last month in The Wall Street Journal say he since dropped his stake to about 1.7 percent.
Meanwhile, Eaton, who presided over Chrysler Corp. during its era of profits and respect, remains a quiet, solitary figure. It is known that he doesn't want to say anything that would cause any more distress for his former Chrysler employees.