On 25th July 2018, Sergio Marchionne, the former CEO of Fiat Chrysler (FCA) passed away in a hospital in Zurich aged 66, following a worsening of his health after surgery to his shoulder. Marchionne was succeeded just days earlier by Mike Manley, the British boss of Jeep, and in a statement, John Eikann, chairman of the Fiat holding company Exor NV, said “Unfortunately, what we feared has come to pass, Sergio Marchionne, man and friend, is gone.”
Marchionne has been heralded as the saviour of two car makers – Fiat and Chrysler, and he masterminded the Fiat Chrysler group. Despite working in accountancy and having no background in the automotive industry, he became the CEO of Fiat in 2004 and took swift action to reduce inflated production levels and cull slow-selling models from Fiat’s line-up. He returned the company to profit within two years, but made enemies with the unions by making thousands of workers redundant.
He had a quirky side, being famed for always wearing near identical jeans and jumpers, fuelling himself with espresso coffee and cigarettes, and driving Ferraris around FCA’s Maranello test track to blow off steam. At press conferences he would often quote philosophers and cite musical and historical references.
But Marchionne was also a tough negotiator, attempting first to force General Motors to buy Fiat thanks to an existing alliance, before persuading the US giant to pay $2 billion to sever its ties. This money helped fund the development of models like the modern Fiat 500, a homage to the iconic city car, that quickly became one of Europe’s best-selling models.
His deal to take over Chrysler was even more audacious. Following the collapse of the US economy, Detroit’s ‘Big Three’ manufacturers were in turmoil, and in 2009, Marchionne offered to step in to save the failing Chrysler marque. The catch was that he wanted the stake for free, and faced with thousands of job losses and no other buyers, the government had little option but to agree to the deal. By 2011, Chrysler posted its first profit for five years, and in 2014, Fiat completed a complete merger that created FCA (Fiat Chrysler Automobiles) and the world’s seventh-largest car maker. It gave the Italian manufacturer greater access to North American and global markets.
Under Marchionne’s lead, Ferrari was made independent from the rest of the group, but he remained in charge of the supercar manufacturer until he stepped down in July. There’s been an increased focus on FCA’s premium brands in recent years, with little mention of Fiat at the recent unveiling of a five-year plan for Fiat Chrysler Automobiles in June. Here Marchionne announced plans to expand Jeep, Alfa Romeo and Maserati, with new model launches and heavy investment in hybrid and electric powertrains planned to double profits by 2022.
Marchionne had been planning to retire as FCA’s CEO next year, and from Ferrari in five years, but his unexpected death is likely to create uncertainty at FCA and Ferrari, with shares falling 10 per cent in June when he announced his plan to step down. Brit born Mike Manley takes over the reins and has already shown impressive leadership, growing Jeep sales from 320,000 in 2009 to a forecast of almost 2 million units this year.
With the passing of Marchionne, we lose a true industry great. A character that was larger than life, always delivering insightful interviews and wasn’t afraid of taking a risk. The automobile world is already a poorer place without him.