(Updated July 25 with Marchionne’s death starting in first paragraph.)
After being the alter ego of one man, it’s now up to Fiat Chrysler Automobiles to show it’s more than the late CEO Sergio Marchionne.
The company claims multiple headquarters, including London, Turin, Italy, and Auburn Hills, MI. In reality, Fiat Chrysler was where Marchionne, 66, happened to be at any given time. He flew across the Atlantic Ocean constantly.
That abruptly ended. The automaker on July 21 said Marchionne’s health had “worsened significantly in recent hours” following complications from shoulder surgery. The company named a new chief, Mike Manley, who had been head of FCA’s Jeep and Ram brands. On July 25, Marchionne’s death was announced. No additional details were provided.
Make no mistake. Fiat Chrysler was Marchionne’s creation. The former Chrysler Corp. was at death’s door following the financial crisis of 2007 and 2008.
The Obama administration planned to bail out financially afflicted General Motors. But Chrysler’s fate was dodgy. It had suffered under a disastrous ownership by private equity firm Cerberus Capital Management. Cerberus picked it up after Daimler AG, which acquired Chrysler in 1998, soured on the U.S. automaker and dumped it in 2007.
A Chrysler bailout wasn’t a given. Chrysler had near death experiences before. This time, it looked like it was going to happen.
Instead, Fiat, headed by Marchionne, took over Chrysler under a U.S. government-backed bankruptcy. U.S. sales for the company rebounded. The CEO made Ram, formerly a model name of Chrysler’s Dodge division, into a separate brand. He targeted Jeep for international expansion. Truck sales boosted profit. In the U.S., the company mostly gave up on cars.
Marchionne wasn’t the typical auto executive. Stylistically, he wore sweaters instead of suits. More substantively, he tended to be blunt. Whenever Marchionne made a public appearance, reporters had to be on guard. The CEO’s handlers had to be extra alert as well. News could break out at any moment, a contrast with executives at other automakers.
The (now former) FCA chief was set to retire next year. That transition was always the major question facing Fiat Chrysler going forward.
Future Becomes Present
Now, fate has accelerated the timetable. Fiat Chrysler’s post-Marchionne future is now the post-Marchionne present.
“Mike Manley is a worthy replacement at FCA, but it’s a huge job to not only fill Sergio’s shoes, but to run many brands that are facing capricious fortunes in a variety of markets,” Rebecca Lindland, executive analyst at Kelley Blue Book, said in written statement. “But Manley’s masterful management of Jeep and Ram will serve him well as he moves into this huge, global role.”
Still, no matter how well Manley has performed to date, it’s always different when you step into the top job. It’s especially different when you become chief of a company created by your immediate predecessor.
Change is coming at Fiat Chrysler. That’s inevitable. What bears watching is how smoothly and adeptly the change can be managed.