Hebe Out, Schmueckle in as Freightliner CEO

Slumping sales at the nation’s biggest truck manufacturer have forced James L. Hebe to step down as chief executive officer of Freightliner and give way to former Chief Financial Officer Rainer Schmueckle, who has been named by the parent company DaimlerChrysler (DCX) to replace him.

(TT File Photo) James L. Hebe

According to news reports, the move comes as a step in DaimlerChrysler’s efforts to stem losses which may reach $500 million this year and restore Portland, Ore.-based Freightliner to profitability. The company has already slashed both production and jobs.

The Wall Street Journal, citing truck manufacturing industry officials, speculated that DaimlerChrysler may cut more jobs and seek to sell off some parts of Freightliner in a drive to return the company to profitability.

Hebe will become the second CEO of a major trucking company to be replaced. Marc Gustafson, who had headed Volvo Trucks North America for four years, resigned in February.

North American production of big trucks plunged 24% last year to about 255,000, from a record 334,000 in 1999. The sales total in the U.S., also a record, was in excess to 260,000.

The decline, which widened early this year due to a mix of higher interest rates and fuel prices, reduced freight shipments and a glut of used trucks on dealer lots, is estimated at about 40% of the 2000 figures.

The oversupply of used trucks has been laid to overproduction of new trucks in 1999 and 2000. Hebe has been criticized for sales practices that helped trigger new truck sales but made used truck values fall.

As the largest truck maker on the continent, Freightliner has recently reduced output of heavy-duty trucks by 30% and eliminated 5,000 jobs, about 20% of its workforce.

(Click here for the press release.)

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