• by Karl Greenberg , December 6, 2006

Joe Eberhardt, EVP global sales, marketing and service at Chrysler Group is gone after three years as the leading sales and marketing executive, the automaker announced yesterday. He's heading back to auto sales within the Mercedes-Benz network in the U.S.

The senior vice presidents and vice presidents of sales, marketing, international and service will report directly to Chrysler President and CEO Tom LaSorda until further notice, the company said in a statement.

Analysts say it's no surprise that Eberhardt is leaving.

Eberhardt, who joined Mercedes-Benz in Germany in 1982 and was once general manager of Mercedes-Benz Manhattan, was at the heart of a dealer insurrection because his ideas about retail were on the European model, in which dealerships are owned by the company. U.S. dealers, who are independent businessmen, felt slighted.

"He has a different approach and different mindset when it comes to the place dealers inhabit on the food chain," says Jim Sanfilippo, analyst with AMCI, Detroit. "Dieter Zetsche [now DaimlerChrysler's CEO] was much more progressive and western, while Eberhardt was more parochial. In this country you can't inappropriately foist on them an unequal portion of the manufacturers' responsibility."

Specifically, Eberhardt reportedly tied delivery of quicker-selling vehicles like the new Dodge Caliber crossover to accepting delivery of slow-selling SUVs and pickups.

By October, when inventory was over half a million vehicles, Chrysler was asking 500 dealers--many of whom said they were filled up with 2006 inventory on which they have to pay interest--to take delivery of 50,000 more vehicles.

Eberhardt also drew criticism for a 0% financing offer on the dealer-lambasted "Dr. Z" campaign, which was meant to create a cognitive link between German engineering and Chrysler cars.

Sanfilippo points out that Eberhardt, as the first German to go at Chrysler Group, shows that the corporate structure is more of a meritocracy now--not a place where "folks that come over here get a soft landing."

It also adds credence, he adds, to Zetsche's assertion that he has no intention of spinning off Chrysler Group, which has had a rocky year, and a burgeoning inventory of trucks and SUVs.

No replacement has been announced for Eberhardt's position, although it is likely LaSorda will take time to find a replacement, since he has both Michael Manley, vice president-sales and field operations, and George Murphy, vice president of marketing, as buffers reporting directly to him. "It gives him the option to go in the market and look," Sanfilippo says.