Bob Eaton's New Co Pilot At Chrysler

Can Tom Stallkamp help the chairman steady Chrysler?

For the past five years, Chrysler Corp. has been the "Bob & Bob" show, with Chairman Robert J. Eaton and Vice-Chairman Robert A. Lutz sharing responsibility for reviving the fortunes of the No.3 U.S. auto maker. But with Lutz's career winding down, it appears that Eaton is soon to get a new running mate: Thomas T. Stallkamp.

Sources close to Chrysler say its board has chosen Stallkamp, a 51-year-old executive vice-president, to succeed Lutz as president. Eaton, 57, has held that position--in addition to serving as chairman and CEO--since Lutz gave it up in January. Chrysler's board was expected to promote Stallkamp to the job at its Dec. 4 meeting.

MOTOWN RARITY. The move is a significant one for Chrysler. First, it puts to rest the internal competition among several contenders for the presidency. Sources say that one of those executives, product chief Thomas C. Gale, will be given considerable control over new-vehicle development and possibly a new title. It also establishes Stallkamp as Eaton's likely successor as CEO. For the past year, Eaton has wrestled with the issue of how to structure his management team for the future. "We've got to continue to give our people more and broader experiences and responsibility," Eaton said in an interview in August.

As president, Stallkamp will take over day-to-day operations. A 17-year Chrysler veteran with asn mba from Miami (Ohio) University, Stallkamp is a savvy manager credited with cutting billions in costs as head of procurement and supply since 1990. "Chrysler's challenge is to improve the efficiency and quality of its operations, and he has great skills in those areas," says John Casesa, auto analyst at Schroder Wertheim & Co. Unlike Lutz, Stallkamp isn't a whiz at product creation, but he has overseen both minivan and large-car teams.

Stallkamp is a rarity in Motown: a procurement exec suppliers actually enjoy doing business with. Instead of forcing cost cuts on them, he challenges them to come up with ideas for voluntary savings. They come in at a rate of 100 a week. But he's no soft touch. "If they don't come up with ideas, they'll eventually lose our business," he says.

IDEAL REPLACEMENT? The changes on mahogany row cap a rocky year for Chrysler. A monthlong strike at a key engine plant last spring and a lack of new products for much of the year shaved Chrysler's U.S. market share from 16% to 15%. Its November sales, however, were surprisingly strong and could indicate a rebound. Sales rose 4%, primarily because of the launch of the new Dodge Durango sport-utility vehicle and generous rebates on its passenger cars. Chrysler hopes to build on that momentum with the introduction of its new Dodge Intrepid and Chrysler Concorde sedans. Those models experienced some early production delays because of a shortage of engine blocks from a supplier.

With the possible early departure of Lutz, who had been slated to stay on as vice-chairman for another year, Chrysler will lose a dynamic leader. A cigar-chomping ex-Marine who flies his own Czech-made jet fighter for fun, Lutz gave Chrysler personality and helped shape its recent image as Detroit's boldest auto maker. But with Eaton pushing hard to boost profits in the face of a sluggish car market, Stallkamp looks like the ideal replacement. If he can fine-tune Chrysler's operations and elevate its quality, Stallkamp will be in good position to take the wheel from Eaton someday.