DETROIT (Reuters) - One of the best-known auto industry executives in the world has fallen on hard times.
Jim Press, who briefly ran Toyota Motor Corp.’s U.S. operations and spent 37 years with the Japanese automaker before joining Chrysler as one of its three top executives in 2007, is facing claims of more than $1.35 million for unpaid federal taxes and a personal loan.
The 62-year-old auto executive, who told the New York Times last year he wore a single string on one wrist as a reminder that material wealth is not the most important thing, may be one of the highest profile victims of Detroit’s collapse.
Press blamed the elimination of bonuses at Chrysler for his failure to pay back the personal loan.
Chrysler went into a U.S. government-financed bankruptcy earlier this year in a deal that gave management control to Italy’s Fiat SpA.
The distressed state of the Detroit area housing market, which has been hit hard by the U.S. housing bust and the auto industry’s troubles, may be adding to his problems.
Press, known to be an avid swimmer, and his wife, Suwichada Busamrong Press, purchased a multimillion-dollar, 6,900-square-foot luxury home in the Detroit suburb of Birmingham in June 2008, taking out a $2.2 million mortgage with ING Bank, records show.
The couple, who have put the six-bedroom mansion up for sale at $3.15 million, now face a tax lien against the property for just over $947,000 related to unpaid income taxes for 2007, according to a filing in late August.
Press has also been sued by a California credit union for failing to repay $406,000 on a loan dating back to his time at Toyota, court records show.
“No comment,” Press said in an email to Reuters. “Thank you for your interest.”
The lawsuit and tax lien against Press were first reported by The Detroit News on Friday.
Press was the only member of Chrysler’s senior leadership team to remain with the company after it completed a fast-track bankruptcy backed by $10 billion in federal funding in June.
His immediate future at Chrysler is unclear. Two people briefed on the matter said in late August that Press had conveyed plans to leave Chrysler by November.
Documents filed with an Oakland County court and the county register of deeds appear to show how Chrysler’s deepening financial problems corresponded with a liquidity crunch for one of its most visible and highly regarded executives.
Late last year, with credit markets in a tailspin and Chrysler seeking a federal bailout, Press was forced to plead with a credit union for forbearance on a personal loan.
That loan totaled over $800,000, and he missed repayments in November 2008 and in February this year totaling more than $400,000.
“Due to the turmoil in the automobile industry and uncertainty surrounding our ownership, my request for bonus payment was denied,” Press said in a letter to the Western Federal Credit Union that was included as an exhibit in a lawsuit against him.
“I am not able to make the November and February payments due to the elimination of bonuses which was just announced by my company,” Press said in his letter.
Press told the credit union, which took on the unsecured personal loan when it bought Toyota Federal Credit Union, that he had tried to obtain loans at his two current banks and sought to refinance his house without success.
“I am attempting to arrange for a loan against my future bonus with my employer which would allow me to pay this loan off,” Press said then.
The lawsuit was filed June 30 in Oakland County Circuit Court.
“We are simply pursuing our contractual rights to collect on a loan that was made to Mr. Press some time ago for which other collection efforts have been exhausted,” Western Federal said in a statement.
No one answered the door on Friday at the mansion in Birmingham, Michigan, and it appeared to be empty, as was the circular driveway, which was flanked by pink and white flowers. The lawn was well-tended. A statue of a dog sat on the porch.
Press said he wanted to restore an American icon when he joined Chrysler, but his term at the No. 3 U.S. automaker corresponded with deepening financial problems, stalled product development efforts and a controversial decision to slash Chrysler dealerships.
During his career at Toyota, Press became the first non-Japanese person elected to Toyota’s board of directors. The Kansas native was known for a soft-spoken manner that seemed a perfect match for the self-effacing style of corporate Japan.
At Chrysler, however, Press ran into criticism from the automaker’s struggling dealers for what many saw as an attempt to get them to take on more inventory than they could afford just on the cusp of the automaker’s bankruptcy.
Divorced with four grown children, Press married his Thai-born wife in 2006 just as his career at Toyota was winding down.
In last year’s interview with the New York Times, Press said, in reference to the string on his wrist: “This is actually from my wife’s grandfather. It reminds you that in life, you just need enough to get along. What’s important in life isn’t what you have, but how you live.”
Additional reporting by Kevin Krolicki and Bernie Woodall; Editing by Matthew Lewis, Gary Hill