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Home / Business / Sergio Marchionne, who reported Chrysler and Fiat, dies at the age of 66

Sergio Marchionne, who reported Chrysler and Fiat, dies at the age of 66



Sergio Marchionne,

The merger of the weakest companies in the auto industry – Fiat and Chrysler – and turned the combination into a cash-generating machine, died at the age of 66.

Mr. Marchionne was treated for complications at the Zurich University Hospital after undergoing a surgical procedure on his right shoulder in July, Fiat Chrysler Automobiles NV said. The health problems forced the company to unexpectedly dismiss him as CEO on Saturday and accelerated the departure scheduled for early 2019 after a decade at the helm of the Italian-American automaker.

Exor SpA, the company controlling Fiat Chrysler, announced Wednesday that Mr. Marchionne's death. While Marchionne was less well-known in the general public than predecessors like Lee Iacocca, he was a star in the auto industry, and his death marked the end of an era in Detroit, where he was one of the last larger-than-life CEOs. He enjoyed a provocative orthodoxy in the auto industry and was ahead of his rival in some major automotive trends.

At the time of his departure, the broker Evercore ISI called him "one of the most impressive and successful CEOs in the industry's history" [1

9659004] Born on June 17, 1952 in Chieti on the Italian Adriatic coast, Mr. Marchionne moved in with his parents in 1966 The Toronto area, according to Mondo Agnelli, a book about Fiat's deal for Chrysler. Mr. Marchionne went to university and law school in Canada, where he later worked for Deloitte & Touche. In the 1980s, he returned to Europe, where he took on a number of increasingly high-level activities at several Swiss-based industrial companies.

Mr. Marchionne joined the Board of Fiat in 2003 as head of Geneva

SGS Group

then partly in the possession of the founding family of the car maker. The following year, he was weighed into the position of CEO at Fiat to fill a leadership vacuum at the top.

His restructuring of the problem-ridden Italian automaker was helped by a $ 2 billion deal he hit

General Motors
Co.

In 2005, the American giant was able to conclude a contract that had been negotiated five years earlier and that would have required the purchase of 80% of Fiat's auto business that he did not yet own.

Until the financial crisis of 2008 owner Cerberus Capital Management wanted to sell, and Mr. Marchionne was ready for the deal that would define his career. With nearly $ 8 billion in loans from US and Canadian governments, Fiat took control of Chrysler after filing for bankruptcy and wasting time to sideline long-time executives, shut down traders, and restructure its lineup.

Instead of setting up an office in As An Imposing Tower for Campus Executives at Chrysler's headquarters in Auburn Hills, Michigan, he set up his desk on the fourth floor of the adjoining Technology Center. He took an exhausting journey seven days a week and flew in a private plane between Italy and the United States.

A self-proclaimed workaholic, Mr. Marchionne wore a stack of up to five smartphones and wore a black sweater and jeans daily, even if you visit dignitaries and leaders like President Donald Trump. Mr. Marchionne kept about 30 sweaters and jeans in each of his homes in Michigan, Turin, and Switzerland so he could travel with minimal luggage. "I have identical clothes everywhere I live, except for my socks," he said in an interview in 2011.

It was also known that he swallowed espresso and smoked cigarette brand Muratti, a habit that company officials say he quit smoking about a year ago. Mr. Marchionne loved playing poker on his transatlantic flights, management said, and he was not afraid to fold early if he dealt a losing hand – at the card table or when assessing corporate strategy.

His first plan An example is the import of Fiat models to the US and the use of small car technology on Chrysler vehicles. As part of the rescue agreement with the US, Fiat agreed to build a US-made compact car capable of getting 40 miles a gallon. But this car – the Dodge Dart – was a bad seller, an early indication that consumers in the US were moving away from limousines and moving into larger vehicles

. Marchionne canceled almost all of Fiat Chrysler's limousines for the US market – including the Dart and Chrysler 200 models – and aggressively moved to US factories to boost production of Jeep SUVs and Ram pickup trucks. This step was later imitated

Ford engine
Co.

, which said this spring, it would leak almost all US limousines. It is expected that General Motors Co. will also streamline its sedan series.

Mr. Marchionne, a longtime advocate of the consolidation of the auto industry, provided a 25-page PowerPoint manifesto titled "Confessions of a Capital Junkie." In 2015, in which the CEO criticized the "depreciating capital dependency" of the auto industry, with charts and charts Graphs showing the industry as a laggard in enterprise value and return on invested capital compared to other sectors. He urged his automakers to consider consolidation in order to achieve stronger shareholder returns.

Many auto executives agreed with their industry's unwavering assessment, but some saw Mr. Marchionne's letter as a barely veiled request for a merger or acquisition partner. In fact, just a few weeks after the publication of his report, he began a heretical public advertisement by General Motors Co., arguing that the combination of long-time rivals would provide the necessary scale for the next downturn.

The company insisted on the size and long-term vision of doing it alone. Executives from other automakers poured cold water on the idea to connect with Fiat Chrysler. In a June 2015 analyst conference call, Ford chief financial officer Bob Shanks said such a marriage would "double in the past."

In the last two years, when Fiat was raising Chrysler's fortune, Mr. Marchionne began to announce he was ready to do the business alone. At the beginning of this year [2018] he said he was looking for a fusion partner.

Fiat Chrysler's stock prices have nearly quadrupled over the last four years, earning Wall Street analysts a pledge to reanimate Fiat and Chrysler. During a first-quarter conference call with analysts in January,

Morgan Stanley
is

Adam Jonas

admitted that he was a former skeptic who had closed the circle.

"In 2004, when first introduced to the auto industry, many people thought," Who the hell is this guy? "Right? I was one of them, frankly," said Mr. Jonas. "In many countries there are many hundreds of thousands of families who are better off because of you and your team, God bless you, Sergio, we'll never see anyone like you again."

Write to Chester Dawson at [email protected]


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