Chrysler CEO rallies team

LaSorda See full image

LaSorda urges employees to stay on task amid uncertainty, commit to turnaround plan.

Josee Valcourt / The Detroit News

With the process of selling Chrysler heating up by the day, CEO Tom LaSorda exhorted employees Tuesday to pour their efforts into the company's fledgling turnaround plan.

In an e-mail and video message, LaSorda told employees that Chrysler needs to "relaunch" its Recovery and Transformation plan this month despite the turmoil surrounding the automaker.

"This is a critical time for the Chrysler Group," LaSorda said in the message obtained by The Detroit News. "During recent town hall meetings, I've stated that regardless of our future status, we have a job to do today. And in this dynamic industry, we can't afford to wait months, weeks, or even days for the dust to settle."

Chrysler launched its Recovery and Transformation plan on Feb. 14, the same day DaimlerChrysler AG CEO Dieter Zetsche revealed that the German company was exploring all options for Chrysler. Since then, it's become clear that DaimlerChrysler is moving toward the sale of Chrysler.

By the tone of his message, LaSorda appears concerned that Chrysler's uncertain future is distracting employees charged with returning the company to profitability by 2008 and becoming solidly profitable by 2009. Chrysler lost $680 million last year.

As part of the intensified effort, LaSorda told workers to expect detailed presentations in their department so each person will know their role in the turnaround.

"We have a solid plan, but success depends on your active engagement," he said. "It is all about harnessing our energy to execute the Recovery and Transformation plan. Learn about the plan, understand your role and commit to making it work."

In the video, LaSorda encouraged workers to ask questions "to clear up confusion about this company's direction."

Chrysler's turnaround plan calls for eliminating 13,000 hourly and salaried jobs and reducing annual production capacity by 400,000 units.

LaSorda said the plan focuses on seven areas: product strategy, fixed costs, structural changes/manufacturing, material costs, revenue management, quality and capital management.

Tuesday was at least the third time in recent weeks that LaSorda has asked employees to stay on task amid the uncertainty.

Clear directives from the top are crucial for Chrysler right now, said Brian Krasicky, a certified public account with Grand Rapids turnaround firm O'Keefe & Associates.

"Communication during a turnaround and a sale process is critical because those two processes are very distracting to the lives of the employees," said Krasicky, a former headhunter and consultant who specializes in finance and auto suppliers. "The success of a turnaround plan is predicated on continuing successfully the operation of a business."

DaimlerChrysler is entertaining bids from private equity firms Cerberus Capital Management LP and Blackstone Group, which is working with Centerbridge Capital Partners. Auto supplier Magna International Inc., which has partnered with Onex Corp., a Canadian buyout firm, is also a prospective buyer. Kirk Kerkorian's Tracinda Corp. also has submitted an unsolicited bid.