Noel Goutard has been described as one of France's toughest business leaders. There is a reason for that. When he took charge of Valeo Inc. in 1987, it was an ailing, mid-sized parts maker, selling primarily to Renault SA and PSA/Peugeot-Citroen SA. But Goutard realized Valeo's potential.
He cut costs, sold marginal assets and planned acquisitions. Valeo expanded. It gained a reputation as a company that wanted to supply automakers globally with almost everything. Today, Valeo is ranked as the world's 10th largest supplier. It is Europe's second largest.
Goutard, 69, retired in May 2000. But he could not let go. As business slipped under his successor, Andre Navarri, Goutard saw an opportunity. At the urging of Valeo's largest shareholder, the board of directors asked Navarri to leave. Now Goutard is back as chairman, with responsbility for long-term strategy. Thierry Morin became chief executive. He had been chief operating officer.
Despite Goutard's return, his past decision to expand into North America has caused much of Valeo's troubles.
Valeo recently was forced to write off $145 million in losses linked to its unprofitable plant in Rochester, New York. The plant was part of Valeo's $1.7 billion acquisition of ITT Automotive's electrical systems business three years ago.
The U.S. plant has suffered bitter labor relations. Morin told shareholders last month Valeo will either close or sell the plant if it cannot reach an agreement with the union.
Big changes are required to improve Valeo. Goutard must simplify and decentralize its management. And the company must focus on its core businesses: transmissions and climate control systems. Lighting, wipers, electrical power generation, security systems, wiring and switches also are considered important products.
Goutard often is described as autocratic - subordinates fear him. But he also is respected and firmly in control.