FCA AND FERRARI UNDER NEW LEADERSHIP, SERGIO MARCHIONNE IS OUT

If you are like me, you like to keep the pulse of the automotive industry. So, it’s likely that you check the headlines for anything auto related during the week. Then, on the weekends you might scan your local area and mobile apps for car shows/meets. On those evenings you may only scan the automotive headlines at night while lying in bed trying to fall asleep. That way you can make sure you’re not missing any big news, even if through half-closed eyes.

Stay with me. Years ago, Sergio Marchionne made it clear that he would retire soon. That target was anywhere from April 2019 to sometime in 2021. Having said that, plans were put in motion to identify people for transitional steps leading to his retirement.

Well, this weekend big news happened! I’m not kidding. As I scanned headlines through half shut eyes I came across something… that dramatically shakes the automotive landscape. That planned transition for the power hand-off to new leadership was enacted immediately on Saturday. Sergio Marchionne had shoulder surgery and then had complications. These complications were severe enough that his timely return to work was questionable. In fact, some news outlets are calling it Sergio’s “Health Crisis”.

I certainly hope Sergio’s health is not as bad as it is painted. I hope he pulls through quickly and is able to enjoy forced retirement to it’s fullest. He has been a visionary in the industry and a strong influence on many of the movers and shakers of the automotive world. I would love to see him come out rosy and start other projects outside the bonds of his most recent positions with FCA (Fiat Chrysler Automobiles) and Ferrari.

Here’s what I mean by “most recent positions”. As of immediately, Mike Manley has been granted “all the powers of CEO” of FCA. In other words, the transition is done at FCA. Sergio is out. The same is true over at Ferrari, Sergio is out. John Elkann will be replacing him. These moves, of course, have to be approved by shareholders. But, for the sake of continuity, why wouldn’t the shareholders approve it? So, let’s just say, it will happen.

Why is all this significant?

If you are unfamiliar with Sergio Marchionne and his impact, please allow me a moment more of your reading time to bring you up to speed. Sergio was a financial wiz that became the top banana at FCA and Ferrari. He is credited with saving Chrysler from what could have arguably been disaster during the Great Recession that was forcing that company into bankruptcy again. So FCA was born out of that moment under Sergio. It was a merger that brought Fiat and Chrysler together, saving Chrysler. Since then, Jeep and Ram have become very robust on the Chrysler balance sheets and the government bailout money received from the United States government has been paid back. Meanwhile, over at Ferrari he helped orchestrate an incredibly popular and successful IPO of that brand in 2015. So, needless to say, Sergio has earned, and rightfully so, the respect of the automotive industry the world over.

How much respect? On Saturday John Elkann, the FCA President, read a letter to employees about the hand-off of power that showed Sergio’s impact on him. It began,…

“Dear Colleagues,

This is without a doubt the most difficult letter I’ve ever had to write.

It is with great sadness that I have to tell you that our CEO Sergio Marchionne, who recently underwent surgery, unfortunately experienced complications that have worsened in recent hours and will prevent his return to FCA.

For the last 14 years, first at Fiat, then at Chrysler, and finally at FCA, Sergio has been the best CEO that anyone could ask for and, to me personally, a true mentor, partner and close friend.

We met at one of the darkest moments for our company and it was his intellect, perseverance and leadership that saved Fiat. He also achieved a remarkable turnaround at Chrysler and, through his courage in forging the cultural integration of the two companies, he established the foundations for a more secure and brighter future for us to take forward. For what Sergio has been able to accomplish, turning the impossible into the possible, we will be forever grateful…”

The letter continued to shower praise,...

“He taught us to have the courage to challenge the status quo, to break with convention and go beyond the tried and tested. He has always pushed everybody to learn, to grow and to excel – often beyond their own limits – starting always with himself. The legacy he leaves with us speaks to what really mattered to him: the pursuit of excellence, the idea that there is always a better way.”

That’s a lot of respect shown in that letter. Not only did it praise Sergio for his business acumen, but it also praised him for his personal impact and philosophy.

Readers, I do not believe that it would be a stretch that Sergio Marchionne will go down in automotive history books as one of the pillars of strength during the questionable financial market of the early 2000’s and its current continued recovery even now. He not only saved brands, but he also made them more profitable. Additionally, he comes off as truly motivating to those his work has been handed to.

Earth shaking news, yes. Sergio Marchionne is no longer the head FCA or Ferrari. But, as mentioned, the handoff has already happened. So, the impact will be minimal to business operations. But, personal impacts and lasting influence will be felt for a long time. Sergio Marchionne, we wish you a full recovery and a retirement time full of family and automotive passions.