Sergio Marchionne, the man credited with saving two automakers and then bringing them together to become a global powerhouse, has died at the age of 66.
The Italian-born, Canadian-bred executive suffered an apparent stroke after what had been billed as “routine” shoulder surgery last week, spending the last several days on life support at a Swiss hospital. Set to retire next year, Fiat Chrysler Automobiles revealed the degree of his health problems on Saturday when it announced that Marchionne would immediately be removed as CEO and replaced by the 54-year-old Mike Manley.
“Unfortunately what we feared has come to pass. Sergio Marchionne, man and friend is gone,” said FCA Chairman John Elkann, heir to Fiat’s founding Agnelli family which still owns a controlling stake in the trans-Atlantic automaker.
Considered a tactical wizard, Marchionne was a relative latecomer to the auto industry when he was tapped by the Agnelli family to serve as a board member at the then seriously troubled Fiat in 2003. He was elevated to CEO a year later, quickly righting the floundering Italian company.
Marchionne became a global brand in his own right when, in 2010, he announced that Fiat would step in to help the bankrupt Chrysler. The smallest of the domestic U.S. carmakers had, along with cross-town rival General Motors, been forced to file for Chapter 11 protection as a result of the Great Recession. But while then-President Barack Obama authorized a federal bailout for GM he was initially reluctant to rescue Chrysler until Fiat stepped in.
Over the next several years, Fiat and Chrysler began to combine their operations while Marchionne steadily bought out the shares held by others participating in the Detroit automaker’s rescue. Finally, after acquiring the last stake, granted to the United Autoworkers Union in return for worker concessions, Marchionne formally combined the two companies into Fiat Chrysler Automobiles.
Those who have worked with him over the years have described him as a force of nature, constantly on the move, winging from Chrysler’s headquarters in the Detroit suburbs to Fiat’s old home in Italy, while also making stops at FCA’s legal headquarters in London.
“He’s an extra-dynamic individual with endless energy,” said David Cole, director-emeritus of the Center for Automotive Research, when the first word of what FCA initially described as an unexpected turn for the worse in Marchionne’s health was announced Saturday.
The 66-year-old executive had just one month ago presided over a critical meeting in Milan bringing together FCA officials, industry analysts, and journalists from all over the world. During the day-long session, Marchionne and several key lieutenants outlined their next five-year strategy, which primarily will rely on four of FCA’s many brands: Detroit-based Jeep and Ram, and Italy’s Alfa Romeo and Maserati.
Then, Marchionne decided to take a health break, going in for surgery to repair a shoulder problem. He had expected to be off work for only about two weeks. Precisely what went wrong has not been released, though it was known that by the weekend he had suffered serious complications, plunged into a coma, and was being kept alive on a respirator at a Swiss hospital. He apparently had suffered a stroke following the surgery.
The loss of the founding FCA chief executive came nearly a year before he was scheduled to retire. But there was little surprise in the man chosen on Saturday to replace Marchionne. As one senior executive told NBC News, asking not to be formally identified, “It was Mike’s job to lose.” The British executive has taken an ever more public role at FCA in recent months, and was one of the key presenters at the announcement of the company’s five-year plan in June.
Marchionne’s legacy is a significant one, observers say, among the rare individuals who can claim to have rescued two car companies during his career. One of the other achievements the CEO was clearly proud of was having eliminated FCA’s industrial debt — which he officially announced at the Milan summit.
But Marchionne didn’t achieve everything he set out to do. Almost since bringing Fiat and Chrysler together he had openly declared his intention of finding another alliance, perhaps even a merger, partner for FCA. He had repeatedly been rejected by potential targets including General Motors and Volkswagen.
Manley has a number of other challenges on his desk, including the need to ramp up FCA’s efforts in several key areas, including autonomous driving and vehicle electrification. Marchionne had long been skeptical about both technologies but had recently begun to push forward.
The other challenge for Manley will be crafting his own management team. He has already lost one key executive, Alfredo Altavilla, the head of FCA’s European operations, and one of those in the hunt for the CEO spot, who resigned on Monday.
But perhaps the biggest challenge for Manley will simply be to generate the force field personality that Marchionne used to bring Fiat and Chrysler together and then turn FCA into a viable industry competitor.
“The news is heartbreaking and will be heartbreaking to a lot of people. Sergio was a unique individual and he will be sorely missed,” said Manley on Wednesday during the company's somber earnings call.