Sergio Marchionne, the former chairman of the Fiat Chrysler Automobiles (FCA) Group, has passed away at age 66.
Marchionne, 66, suffered complications from a recent shoulder surgery at a hospital in Zurich, Switzerland, and was replaced as CEO last weekend when his ill health prevented him from continuing in a leadership role.
“Unfortunately, what we feared has come to pass. Sergio Marchionne, man and friend, is gone,” confirmed FCA chairman John Elkann, of the controlling Agnelli family, in a statement.
Marchionne joined the board of then-struggling Fiat in 2003 with no car industry experience but a reputation for turning around loss-making firms. He became CEO the following year following chairman Umberto Agnelli’s death. Agnelli was replaced by Ferrari chief Luca de Montezemelo, prompting Fiat CEO Giuseppe Morchio – who had expected the chairman job – to quit.
In 2009, Marchionne capitalised on a major opportunity to grow Fiat by acquiring a stake in Chrysler, which was in dire straits following a disastrous alliance with Daimler and the 2008 financial crisis. Fiat took a 20 percent stake in Chrysler in 2009, which Marchionne increased to 58.5 percent in 2012. Two years later Fiat bought out the remaining shares, leading to the creation of Fiat Chrysler Automobiles. The deal gave FCA greater access to the North American market, and the scale to compete against global rivals.
At the same time, Marchionne spun off Ferrari into an independent division, although he remained in charge of the sports car firm. He had intended to continue in that role for another five years, meaning his sudden departure could have more short-term impact on the firm.
Unlike FCA, Marchionne was still developing Ferrari’s future product plan, which will include the brand’s first SUV. The firm had an investor day planned for September, where it is due to give more details on its long-term plans.
Louis Camilleri, 63, has been appointed the new CEO of Ferrari. He already sits on the Ferrari board and was the chairman of tobacco firm Philip Morris – a long-time sponsor of Ferrari’s F1 team. John Elkann, the grandson of Gianni Agnelli and the boss of the family’s Exor investment firm, has been named the new chairman. Elkann was a key figure in appointing Marchionne as Fiat CEO.
Under Marchionne’s leadership, FCA has focused on its premium brands, in recent years growing Jeep, Alfa Romeo and Maserati through the development of new SUVs and other models. But Fiat itself has struggled, and in Europe the storied brand will soon focus on electrified city cars.
Marchionne was known for his outspoken and opinionated management style, including openly talking about finding another car firm to merge with. Marchionne’s final public act as the boss of
FCA came at the start of June, when he unveiled the firm’s next five-year plan, including further expansion of the Jeep, Alfa Romeo and Maserati brands, and heavy investment in electrified technology.
At that event, Marchionne responded to financial analysts who questioned why he had developed a plan he wouldn’t stick around to oversee. Describing FCA leaders as “survivors” who had faced losing their jobs before the Fiat Chrysler merger, Marchionne said his legacy would be the culture he instilled in the group.
Noting much of the car industry was focused on method and process, Marchionne said that, while such things were important, “at FCA we are, and always will be, about the music.” Asked whether he’d left a ‘script’ for his successor, he added: “There is no script or instructions. Instructions are institutional and temporary. FCA is a culture of leaders and employees that were born out of adversity and who operate without sheet music.”
Marchionne was due to step down as FCA CEO next year, but was this weekend succeeded by the head of Jeep, Mike Manley.
Under Manley’s leadership, Jeep has massively expanded in recent years, pushing into new markets and launching new models. Sales have grown from around 320,000 in 2009 to an expected 1.9-million this year.
While FCA has already presented its next five-year plan - which Manley would have been a key figure in developing – he faces challenges implementing it. The first priority will be settling the FCA Group following Marchionne’s departure: Jeep’s European boss, Alfredo Altavilla, a contender to replace Marchionne, has already resigned.
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