RPT-CEO says Chrysler rebuilding engineering tradition

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DETROIT, April 17 (Reuters) - Chrysler Chief Executive Bob Nardelli said on Thursday that rebuilding the automaker's engineering capability is a top priority of its restructuring under private equity owner Cerberus Capital Management LP.

Speaking at a dinner sponsored by SAE International, a soceity of engineers, Nardelli said Chrysler's situation is unique among the more than 100 acquisitions he has been involved with throughout his career.

"We've gone from being a scrappy, underdog of a company with its own identity, culture and metrics ... to a division in a much larger company," Nardelli said in a speech in reference to Chrysler's acquisition by Daimler-Benz a decade ago.

"Now, we're challenged to re-establish Chrysler as an operating company and rebuild our core competencies once again -- with our engineering capabilities at the top of the list."

Chrysler has moved quickly to restructure since Cerberus [CBS.UL] acquired an 80 percent stake in the No. 3 U.S. automaker last summer.

Cerberus tapped Nardelli -- a former head of Home Depot Inc (HD.N) -- as Chrysler's CEO in the immediate aftermath of its purchase, adding top executives from other automakers to key roles within months.

The carmaker has said it plans to eliminate some duplicate vehicles among its Chrysler, Dodge and Jeep brands and wants dealers to take a frontal role in trimming a structure better suited to a much bigger car maker.

Chrysler also has sought to address customer complaints about interiors, materials, noise and handling, approving 260 changes within two months of the Cerberus purchase at a cost of more than $500 million. Nardelli said that list has now grown to more than 400 changes.

Chrysler expects alliances and partnerships to play a big role in expanding internationally, where it has few sales.

Chrysler and Nissan Motor Co Ltd (7201.T)NSANY.O unveiled an alliance on Monday, providing Chrysler with a Nissan-built small car for North America and other markets, and Nissan with a Chrysler built full-size pickup truck in North America. (Reporting by David Bailey; editing by Jeffrey Benkoe)