Americans aim to save Czech company

May 15, 1993|By David Rocks | David Rocks,Contributing Writer

KOPRIVNICE, Czech Republic -- Gerald Greenwald has never shied away from a corporate turnaround. He helped Lee Iacocca rescue Chrysler Corp., recently served as president of troubled Canadian mega-developer Olympia & York Developments Ltd. and is a director of the debt-ridden Irish aircraft leasing company GPA Group.

Now, he's trying to perform a small miracle with a few thousand workers at Tatra, the Czech truckmaker. On Wednesday, he was named chairman of Tatra, heading a team of three Americans tapped to save the company.

Tatra has been reeling since the collapse of the Soviet Union and the Communist bloc in Eastern Europe.

The company has a production capacity of about 15,000 trucks per year, but this year has built just 800. Its plant has been in sporadic production since mid-April, operating one shift per day and standing idle after 2 p.m. And by this fall, only about 9,500 of Tatra's 1990 work force of 14,000 will still have jobs.

That doesn't bother Mr. Greenwald, 57. "My wife accuses me of reaching out for more and more trying challenges. She says that someday she's going to read that I threw myself in front of a moving train and was surprised that it didn't stop."

Mr. Greenwald and two other Americans -- Jack Rutherford and David Shelby, both former execu tives of International Harvester and Ford Motor Co. -- will receive a 15 percent stake in Tatra for their work. The company is privately held -- more than two-thirds of its shares are owned by eight major Czech investment funds.

The team replaces managers almost legendary for their ineptitude. Tatra did little as markets in Russia shriveled, and the company neglected to re-design its only passenger car line for almost two decades. In one disastrous transaction two years ago, Tatra built 1,800 specially designed trucks for Libya, which were never paid for. Today, hundreds of those trucks sit rusting behind the plant.

Although Mr. Greenwald and his team are short on specifics, they plan first to work out an arrangement with Tatra's creditors, who are owed about $71 million. After that, the group will seek to shore up Tatra's position in East European markets, find new distributors in the West and look into using the company's excess capacity to make auto parts for Western carmakers.

"As far as I'm concerned, we have all the elements to succeed here," Mr. Rutherford said. "We have good products, we have good facilities. . . . But it's not a slam-dunker. If it was easy, these people would have already done it."

Mr. Greenwald has become a celebrity in Koprivnice, a small collection of concrete block apartment towers and a handful of villas that spread out from the factory gate. There seems to be universal agreement that "the Americans" are the angels needed to rev up Tatra.

"We're all talking about them and we believe in them. They're our last hope," said Jan Stedry, a Tatra worker who moonlights in a book store across the street.

Such goodwill could vanish if more workers are laid off and management demands concession from the unions. But for now, Mr. Greenwald and his partners seem to have seduced everyone -- from laborers to managers to union bosses.

"Most workers understand that too many people are employed here," said Antonin Valasek, the plant's union chief. "But they are very positive toward the three Americans here, and they expect that with them here, Tatra will regain its position in the world market."

Mr. Greenwald, meanwhile, says the assignment -- which began as a request by Tatra officials for some minor consulting -- is really not that different from his task at Chrysler. It's just the scale that is different.

"In some ways, I think Tatra is ahead of what I saw when I first arrived at Chrysler, because Tatra already has a strong product line," Mr. Greenwald said.

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