Sergio Marchionne, Fiat’s CEO and the architect of its merger with Chrysler, plans to step down after completing a five-year strategic plan to expand the combined carmakers.
“I’ll undoubtedly do something else” after the end of 2018, Marchionne, 62, said last week in an interview with Bloomberg Businessweek at the Balocco test track in northern Italy. “I am not going to do any more turnarounds. I’m done; let some of the young punks do it.”
Since taking charge of Fiat in June 2004, Marchionne has tripled the Italian company’s revenue and operating profit. Now, with the merger into London-based Fiat Chrysler Automobiles NV, his goal is to boost net income fivefold to about 5 billion euros ($6.3 billion) in 2018.
The goal is underpinned by a 48 billion-euro investment program that calls for developing more upscale vehicles, including new Alfa Romeo models built in Italy, and increasing Jeep’s sales to 1.9 million cars by expanding the brand outside North America.
Marchionne, the longest serving CEO of any major European automaker, says his role may be split among more than one executive.
“There are a number of things that the next CEO will do which are totally different from what I do,” he said, while sipping espresso on the veranda of the 19th-century farmhouse at the center of the Balocco track. “The role as presently configured will have to be reconfigured.”
Strong candidates
Chairman John Elkann, 38, isn’t a candidate. The leading member of the Agnelli clan, which founded Fiat and is still the company’s biggest shareholder, plans to maintain the current arrangement of having a family member as chairman and a professional manager as leader of the group.
“The most important thing is clarity,” Elkann, who hired Marchionne from Swiss testing company SGS SA, said at the Balocco track. The family’s non-executive role “has worked well.”
Last year, Elkann mentioned executives such as CNH Industrial CEO Richard Tobin; Alfredo Altavilla, Fiat’s European chief; Mike Manley, head of the Jeep brand; and Cledorvino Belini, head of Fiat in Brazil, as managers who could eventually replace Marchionne.
“I’m comfortable with the bench we have,” Elkann said at a separate meeting in his Turin office, which had previously been occupied by his grandfather, former Fiat Chairman Gianni Agnelli. “We have strong candidates,” he said, declining to comment on specific people.
Marchionne, who calls Switzerland home even as he shuttles between Turin, Detroit and elsewhere, says he looks forward to having time to devote to other interests such as theoretical physics.
“You’re asking me if there are other things I like to do apart from this?,” said the former philosophy student, before lighting another Muratti cigarette. “Phenomenally, yes. I like to be able to think, and that’s not always possible in this job.”
