Former CEO of FCA, Sergio Marchionne, dies at 66
The automotive industry lost a legend today – Sergio Marchionne, CEO of FCA, died this morning at the age of 66 (July 25, 2018). Known as the “Man in Black” who saved not one, but two failing automotive companies, Marchionne was a man with many hats. Over the past decade, Marchionne’s tireless competitive spirit and transparency earned him multiple roles: Chairman and CEO of Fiat Chrysler Automobiles, Chairman and CEO of Ferrari, Chairman of Maserati, and Chairman of CNH Industrial. Those who knew and worked with Marchionne described him as a confident leader with an incredible work ethic.
Early Life + Career
Born in Chieti, Italy in 1952, Marchionne emigrated to Toronto at the age of 13. As a result, he had a dual Canadian and Italian citizenship and was fluent in English, Italian, and French. After studying numerous subjects at Canadian colleges, he earned himself a Law Degree in 1983 and a Masters of Business Administration in 1985. He was recognized as an Accountant, Tax Specialist, Attorney, and Business Strategist. However, it wasn’t until Marchionne arrived in the automotive world, that he rose-to-fame.
Fiat, who was hanging on by a thread in 2004, suffered a tremendous $2.5 billion loss on the center of auto operations that very same year. After gaining the attention of Gianni Agnelli, the former president of Fiat, Marchionne moved to Europe and was given control of Fiat. He was able to negotiate a $2 billion payment given by General Motors in order to settle previous contractual obligations with Fiat and then invested $10 billion euros to develop 20 new Fiat models in four years.
Later in 2009, the Fiat Group saved the Detroit automaker, Chrysler Group LLC, by buying a 20 percent stake. Following this, the government allowed and financed $6.6 billion so Chrysler could quickly emerge from bankruptcy. Marchionne’s plan was to invest in new products, while Fiat and Chrysler shared vehicles, engines, and factories. His goal was to get the companies strong enough to enter the private capital markets and decrease their high-interest debt from the government. By 2011, Marchionne had taken full control over Chrysler and immediately met with several dealers in Las Vegas promising that Fiat Chrysler would invest and improve products, only if dealers promised in return to invest in stores and embrace the best operating practices with consumers. By 2014, Fiat gained full ownership of Chrysler.
“What I found was … a company that had been run by a foreign entity for a long period of time, that had taken all of its wares on the way out. In 2006-2007, it had been flipped over to financially competent – but industrially incompetent – private equity investors who has run it for a period of time and then run into a brick wall in a crisis. What we ended up looking at [when Fiat arrived] was empty cupboards in terms of technology and product. And so we started from scratch.” – Sergio Marchionne.
Marchionne was known mostly for his extreme dislike for Electric Vehicles. He constantly protested against them and considered them a waste of money. However, as a result of Maserati taking such a hit in sales due to Tesla, Marchionne finally gave into electrifying his Jeep, Ram, Maserati, and Alfa Romeo lineup. On July 2nd, he announced his 5-year plan to invest $10.5 billion to develop new electric and hybrid vehicles, before his retirement in April of 2019.
Sadly, he wouldn’t see his plan come to fruition. On July 21st, after Marchionne suddenly stepped down from his position, he went into a coma after suffering an embolism while undergoing an operation for an invasive shoulder sarcoma. “Unfortunately, what we feared has come to pass. Sergio Marchionne, man and friend, is gone.” Says Fiat Chrysler Chairman, John Elkann. His death sparked numerous tributes from his automotive rivals, proving once more that although he was known to be outspoken and controversial, he truly has made a significant impact in the automotive world.
“What a person has done during his life should not be measured by what he has achieved for himself, but rather by what is left behind for others.”
– Sergio Marchionne (1952-2018)