Chrysler CEO To Resign After Bankruptcy

Chrysler CEO Robert Nardelli will leave his post after the company emerges from bankruptcy protection, ending nearly two years of leadership that has seen sales and earnings slump as U.S. auto sales crumbled.

President Barack Obama announced Thursday that the automaker would file for Chapter 11 after the government could not reach a debt-reduction agreement with creditors.

Nardelli said in an e-mail to Chrysler employees that post-bankruptcy would be the appropriate time to leave. He will take a job as an adviser with Chrysler's one-time owners, Cerberus Capital management LP.

He says the Treasury Department did not ask him to resign.

Chrysler has signed a partnership deal with Fiat, and a new board will pick a new CEO with Fiat's concurrence.

Nardelli, former head of The Home Depot Inc., became Chrysler's CEO when Cerberus Capital Management bought the majority of the automaker in 2007.

In his e-mail, Nardelli told employees that their pay and benefits would continue under bankruptcy protection, and that its stay in bankruptcy should be short because of restructuring work done prior to the filing.

"It will allow a leaner new company to emerge in a matter of 30 to 60 days, well positioned for long-term viability. It's also very important to note that Chrysler's Canadian, Mexican and other international operations are not part of any bankruptcy filing," he said.

Most of Chrysler's assets including factories will be transferred to a new company "while assets and liabilities that are not consistent with our business plan will remain with the old company for disposition."