Updated from 10:24 a.m. EDT
Cerberus Capital Management continued its hiring spree at Chrysler on Friday by scooping up
former main man in China.
Phil Murtaugh, the architect of GM's flourishing automotive business in China, will leave his post at Shanghai Automotive Industry to head up Chrysler's Asian operations in October.
Cerberus acquired Chrysler in a leveraged buyout from German automaker
this year. Like its counterparts in Detroit, GM and
, Chrysler's auto business in North America is floundering.
Promising a turnaround, Cerberus recently brought in Bob Nardelli, the former
CEO who left the retailer amid shareholder unrest, to serve as its chief executive.
On Thursday, Chrysler announced that
it had hired the top U.S. executive at
, Jim Press, to be its president and vice chairman of sales and marketing.
"These are some significant people that they've hired in the auto industry," says David Cole, chairman of the Center for Automotive Research. "This helps build the credibility of the new Chrysler, and it makes potential investors and partners view it as a company that is on the move."
Murtaugh's hiring underscores the opportunities that exist abroad for automakers as signs of an economic slowdown continue to emerge in the U.S. The government reported on Friday that August saw the first monthly jobs decline for the U.S. economy in four years. With the housing market slumping and the credit markets at a standstill, these are dark times for Detroit.
When it bought Chrysler, Cerberus won the blessing of the United Auto Workers union by promising to preserve U.S. jobs. But foreign markets such as China and India represent emerging consumer markets and cheap labor opportunities for the company amid the worsening U.S. conditions.
Toyota, which is poised to pass GM as the world's biggest automaker, has built its success by operating as a global company, Cole points out. As well, GM and Ford have gained traction in overseas efforts.
"Chrysler, meanwhile, is basically just a North American company, and that is an Achilles' heel for the company that really has to be dealt with," Cole says.
In July, Chrysler signed a deal with Chery Automobile, China's fourth- largest automaker, to build small cars under the Chrysler brand for sale in the U.S. and abroad.
Murtaugh left GM in 2005 after 32 years at the company. Beforehand, he built a partnership between GM and Shanghai Automotive that resulted in a joint-venture agreement in 1997. The partnership has been one of the few bright spots for GM's auto business in recent years as the company's brands have become some of the top sellers in China.
"It is an offer I just cannot turn down," said Murtaugh in a press release about his decision to join Chrysler.