Business & Finance
DaimlerChrysler's share price shot up 10 percent on European stock exchanges Thursday on news that chief executive Jürgen Schrempp had announced his retirement. Although his contract doesn't expire until 2008, Schrempp will leave by the end of this year and will be succeeded by Chrysler division head Dieter Zetsche, the company said. If only for having orchestrated the 1999 merger of Germany's Daimler-Benz with Chrysler Corp. of the US, Schrempp has been a controversial figure in the industry. The combined company has struggled ever since - first due to heavy losses at Chrysler and then, after Zetche succeeded in turning those around, because of weak earnings at the once highly profitable Mercedes division. At the company's annual meeting April 6, angry shareholders accused Schrempp of poor performance and shoddy leadership. In a statement, DaimlerChrysler's board chairman called his departure date "the optimal time for a change in the leadership of the company." At least one analyst said of the announcement: "This is the day I have been waiting for. It's a wonderful day for the auto industry as a whole."
Federated Department Stores will convert 330 of its recently acquired May Co. outlets to the Macy's nameplate, chief executive Terry Lundgren announced. Federated paid $11 billion for May in March. "The decision," Lundgren said, "was based on careful study and new research on customer preferences." It will enlarge the universe of stores bearing the Macy's name to 730 in the fall of next year, and will affect such May Co. brands as Filene's, Famous-Barr, Kaufmann's, and Foley's. A decision on Marshall Field's stores, another nameplate in the May collection, has not yet been made. However, Lord & Taylor stores, yet another May subsidiary, will retain their separate identity.
MeadWestvaco, a paper products manufacturer that has struggled with rising costs of energy, raw materials, and freight, said Wednesday it will lay off between 700 and 850 people from its salaried workforce. In May, the Stamford, Conn., company sold its writing- and printing-paper business for $2.3 billion to focus on packaging products.