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Cerberus Plans Big Changes At Chrysler

Cerberus is expected to close on its acquisition of Chrysler from DaimlerChrysler as soon as Friday, and big changes are in store. They include the possibility of an expanded alliance with Korean automaker Hyundai and a deal to build cars in Russia.

CEO Tom LaSorda will continue to lead Chrysler's executive team, but analysts expect Cerberus executive Wolfgang Bernhard, Chrysler's former COO and now its co-chair, to drive most of the changes on the product side. A charismatic leader, Bernhard has swept through the organization like a whirlwind--poring over product plans, brainstorming with executives, checking on even routine events like press previews.

The bulk of Cerberus' attention will focus on Chrysler's core activities--purchasing, manufacturing, product development and sales and marketing, says David Brophy, director of the Office for the Study of Private Equity at the University of Michigan. Sources close to the situation say Cerberus insisted on detailed performance goals for Chrysler and its executives.

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