Article up to date as of July 25 at 6:30 am
The death of Sergio Marchionne, announced by FCA in the early morning hours, brought to a premature end the brilliant career of the craftsman behind the revival of Chrysler and Fiat.
With his employees, family and friends already reeling from the charismatic Marchionne’s sudden departure from the company on Saturday, the gravely ill former CEO died today, July 25, after spending his last few days in a coma, according to the Italian daily La Repubblica. Marchionne was replaced by current Jeep and Ram boss, Mike Manley, an industry veteran.
In a statement issued five days ago, FCA management announced that while the Italian-Canadian was recovering from a shoulder surgery at the University Hospital Zurich, “Sergio Marchionne suffered complications unexpected and his condition has seriously worsened in recent hours. As a result, Mr. Marchionne will not be able to return to work.” He was admitted to the hospital on June 27th.
Hospital management remained silent on the cause of the “irreversible” conditions affecting Mr. Marchionne, but the Italian media exposed two probable causes: lung cancer (he was an inveterate smoker) and an injury to the aorta.
A mandate that lasted 14 years
Sergio Marchionne had been the man driving Fiat since 2004. He, too, set the pace for Chrysler’s recovery in 2009, when the American company was bankrupt. Then, in 2014, he took over from Luca di Montezemelo as director of Ferrari, a company he subsequently separated from FCA and took public a year later with a listing on the New York Stock Exchange.
Ironically, the Italian-Canadian who had just turned 66 on June 17 had planned to step down as director of the seventh largest car manufacturer in the world in April 2019. This explains the rather mild reactions, including the slight decline in FCA’s stock market rating, which followed the announcement of his replacement in recent days.
His last public appearance was on June 27, in Rome when Sergio Marchionne handed over to the Carabinieri (Italy’s federal police force) the first Jeep Wrangler in a series equipped to patrol the beaches of Romagna. Marchionne himself was the son of a member of the Carabinieri.
Pragmatic and frugal, Marchionne was a workaholic who consumed cigarettes and espresso in quantity. Always dressed in a black knit sweater (so he did not have to search his wardrobe every morning to find out what he was going to wear), he considered himself a “business repairer.”
A lawyer and economist by training (two disciplines he studied in Toronto and Windsor, Ontario), Marchionne put his talent to work in 2005 to settle a dispute between Fiat Auto and General Motors. He ended this dead-end partnership and got $2 billion in compensation from GM, an amount that several analysts say largely contributed to keeping Fiat alive.
Then, in 2009, he reached an agreement with US President Barack Obama to take over Chrysler, which was in bankruptcy, without paying a dime, but with a promise to share technical resources.
Speaking to the Chicago Tribune, Autotrader industry analyst Michelle Krebs said that “Chrysler would not exist today if it were not for Marchionne, his vision of things and his sense of risk.”
Carrying on the five-year plan of 2018-2022
The UK’s Mike Manley, 54, has taken over FCA and will move forward the strategy outlined by Marchionne in June. This five-year business plan runs from 2018 to 2022 and includes, among other things, the development of commercial vehicles and light trucks, as well as major investments in the electrification of vehicles, projects that must double the profits of the company by 2022.
Central to this strategy is FCA’s flagship brand, Jeep. Headed by Manley since 2009 (who has also run the Ram brand since 2015), its sales volumes are expected to double by 2022 to approximately 2.8 million units worldwide.
On its own, over the next five years, the Jeep brand will launch 14 electrified vehicles, including four pure electric ones.
Major efforts will also be made around the Ram, Chrysler, Fiat, Alfa Romeo and Maserati brands. Expectations are high for the new Ram TRX pickup truck, considering that FCA also wants to double this division’s sales by 2022. Last year, Ram sold 550,000 units.
Other appointments resulting from Marchionne’s premature departure
On Saturday, FCA management also made John Elkann, 42, president of Ferrari. He is the grandson of Gianni Agnelli, himself the grandson of Giovanni Agnelli, from whom he had inherited the management of Fiat in 1966.
Meanwhile, Louis Carey Camilleri became the CEO of this prestigious Italian brand.
Unlike other FCA brands, Ferrari is the one whose future seems the least defined today; Marchionne had planned to remain in charge of it until 2021. For now, besides the fact that its profits are up, we only know that the company’s planned future models include plug-in hybrid and SUV models.
Milestones in Sergio Marchionne’s career
Sergio Marchionne was one of the auto industry’s longest-serving executives. During his 14 years in the service of Fiat SpA and, then, Fiat Chrysler Automobiles, his achievements have been numerous. Here is a brief overview.
June 2004: Appointment as Chief Executive Officer of Fiat SpA. He succeeded four other executives who occupied this position over a period of two years.
February 2005: Settlement of a dispute ending the partnership between Fiat Auto and General Motors. GM pays $2 billion in compensation.
February 2005: Transfer of ownership of the Ferrari Maserati brand to Fiat and announcement of a future technical and commercial collaboration of Maserati and Alfa Romeo.
June 2009: Fiat SpA takes control of Chrysler Group LLC.
January 2011: Fiat’s commercial, industrial, military and agricultural vehicle brands are grouped into a new company: CNH Industrial.
January 2014: Fiat SpA completes its acquisition of Chrysler Group LLC and begins the merger leading to the creation of Fiat Chrysler Automobiles.
October 2014: Merger of FCA assets completed; entry of the new company on the New York Stock Exchange.
October 2015: Ferrari becomes a public brand and debuts on the New York Stock Exchange.
December 2015: Marchionne fails as architect of a merger of FCA and GM.
June 2018: Announcement of a 2018-2022 five-year business plan aimed at doubling FCA’s profits through, among other things, the diversification of utility vehicles and vans and increasing electrification.