Successor to Iacocca chosen? Chrysler directors reportedly select GM official as CEO.

March 16, 1992|By Doron P. Levin | Doron P. Levin,New York Times News Service

DETROIT MJB — DETROIT -- Yielding to the wishes of Lee A. Iacocca, the directors of Chrysler Corp. have agreed to name a General Motors executive to succeed Mr. Iacocca as chief executive, several people with knowledge of the board's deliberations said last night.

After two days of meetings in New York, the board's 10 outside directors settled on Mr. Iacocca's candidate, Robert J. Eaton, who currently heads GM's highly profitable European operations.

Chrysler spokesmen and executives declined to comment yesterday on what was decided, and the company scheduled C news conference for this morning at its headquarters in Highland Park, Mich.

Chrysler, for many years one of the country's 10 largest companies, has slipped to the next tier in the last two years. It is now the most troubled company in a desperately troubled American industry.

Mr. Iacocca, who joined Chrysler in 1978 as president and chief operating officer after he was forced out of Ford Motor Co. by Henry Ford II, is scheduled to retire as chief executive at the end of this year. He will retain his position as chairman, and it is not clear exactly how much power he will retain.

Chrysler's succession plan should remove some uncertainty that has hung over the automaker after the resignation or retirement of nine corporate officers in the last two and a half years. But today's announcement could signal the beginning of a new struggle for power at Chrysler among several top executives and Iacocca himself.

Mr. Eaton, president of General Motors Europe, is an experienced engineering executive who previously supervised GM's technical staffs and was head of GM's ill-fated X-Car program in the 1970s, which later gained notoriety because of unsubstantiated allegations that its braking system was unsafe.

In turning to GM, Mr. Iacocca seems to have slammed the door on the advancement of his No. 2, Robert A. Lutz, currently Chrysler's president and product development coordinator. The wooing of Mr. Eaton apparently signals that Mr. Lutz was weighed by Mr. Iacocca and found wanting.

Because Mr. Lutz is enormously popular within Chrysler, the recruitment of Mr. Eaton, 52, could foster resentment.

The biggest question may be the future role of Mr. Iacocca himself. He had announced he would retire as chief executive at the end of the year, but he also has hinted that he wants to remain active from a position on the board.

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