Ser­gio Mar­chionne, saviour of Fiat, dies

The Malta Business Weekly - - NEWS -

The for­mer chief ex­ec­u­tive of car­maker Fiat-Chrysler, Ser­gio Mar­chionne, has died in hospi­tal in Zurich aged 66.

He was re­placed four days ago when his health wors­ened fol­low­ing com­pli­ca­tions from surgery on his right shoul­der.

Mr Mar­chionne, who was also Fer­rari's chair­man, had led the com­bined com­pany for more than a decade and planned to step down next year.

Mr Mar­chionne has been suc­ceeded by Bri­ton Mike Manley, head of the Ital­ian-Amer­i­can firm's Jeep divi­sion.

"Un­for­tu­nately, what we feared has come to pass. Ser­gio Mar­chionne, man and friend, is gone," said group chair­man John Elkann, a mem­ber of the Agnelli fam­ily that con­trols the com­pany.

Mr Elkann praised Mr Mar­chionne's "val­ues of hu­man­ity, re­spon­si­bil­ity and open-mind­ed­ness".

He added: "My fam­ily and I will al­ways be grate­ful for what he has done."

The man­ager, known for his folksy, colourful turns of phrase and for his dark cash­mere sweaters no mat­ter the oc­ca­sion, was the dar­ling of the au­to­mo­tive an­a­lyst com­mu­nity.

Even when ex­press­ing doubts at his au­da­cious tar­gets, they ex­pressed ad­mi­ra­tion for his adept deal-mak­ing. That in­cluded get­ting GM to pay $2 bil­lion to sever ties with Fiat, key to re­launch­ing the long-strug­gling Ital­ian car­maker, and the deal with the US govern­ment to take Chrysler with­out a penny down in ex­change for Fiat’s small-car tech­nol­ogy.

Mar­chionne joined Fiat af­ter be­ing tapped by the Agnelli fam­ily to save the com­pany. Fiat had for gen­er­a­tions been a fam­ily-run en­ter­prise, and hav­ing some­one at the helm from out­side Italy’s clubby man­age­ment cir­cles even a dy­namo like Mar­chionne was an enor­mous change.

Other key cor­po­rate moves in­cluded the spinoff of the heavy in­dus­trial ve­hi­cle and truck maker CNH and of the Fer­rari su­per­car maker. Both deals un­locked con­sid­er­able share­holder value for Agnelli fam­ily heirs led by John Elkann. Elkann came into his own un­der Mar­chionne’s stew­ard­ship, tak­ing over as chair­man in 2010 hav­ing been tapped more than a decade ear­lier by his grand­fa­ther, the late Gianni Agnelli, to run the fam­ily busi­ness.

Mar­chionne was handed an au­tomaker that lost more than €6bn in 2003. By 2005, he had re­turned the com­pany to a profit by wring­ing some $2 bil­lion from an al­liance with Gen­eral Motors Co., lay­ing off thou­sands of work­ers, in­tro­duc­ing new mod­els, and slash­ing the time it took to get a new car to mar­ket to just 18 months, from four years.

In 2009, US Pres­i­dent Barack Obama’s ad­min­is­tra­tion an­nounced that Fiat would take con­trol of Chrysler LLC, res­cu­ing the Amer­i­can com­pany from bank­ruptcy.

“I don’t care what a tough guy he was to work for, he saved our com­pany,” said Cass Burch, a Chrysler and Jeep dealer in Ge­or­gia. “He de­serves a bronze statue.”

The 66-year-old, who died from com­pli­ca­tions fol­low­ing surgery, was a con­sum­mate deal­maker, known for his non­stop work habit and ra­zor sharp mind.

A poker player, his en­tourage told of sleep­less transat­lantic flights where their chain-smok­ing boss al­ways wanted to play — and win — an­other hand of cards.

The same pas­sion de­fined his im­prob­a­ble res­cue of Fiat via an au­da­cious merger with Chrysler that saved both com­pa­nies and cre­ated the world’s sev­enth largest car group.

He per­suaded Gen­eral Motors to pay $2bn to es­cape its al­liance with a near bank­rupt Fiat in 2005 be­fore swoop­ing on a dis­tressed Chrysler in 2009 and ex­e­cut­ing a full takeover of the group in 2014.

He was de­monised by Beppe Grillo, founder of the anti-es­tab­lish­ment Five Star Move­ment for his clo­sure of plants and job cuts. At one po­lit­i­cal rally in Mi­lan, Grillo led the crowd in a chant: “F**k you, Mar­chionne”.

In pri­vate, Mar­chionne was acutely aware of the rav­ages that glob­al­i­sa­tion had on those left be­hind.

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