Sergio Marchionne’s top five greatest achievements

After the sudden death of former Fiat Chrysler boss Sergio Marchionne aged 66, AutoClassics looks at five of the motor industry legend’s finest achievements

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The automobile industry has been left in shock by the passing of Fiat Chrysler and Ferrari CEO Sergio Marchionne due to complications from shoulder surgery.

Mike Manley, head of the Jeep company, will be proposed as the new Fiat Chrysler CEO while Fiat heir John Elkann has become Ferrari’s new chairman.

Marchionne stood out in every way – charismatic and colourful, also abrasive and ruthless, yet undeniably with a glittering record of success. The difference went well beyond the bottom line with him heralding a grand cultural impact too – stating that at his companies ‘mediocrity is never, ever worth the trip’.

His influence was such that his legacy in the automobile industry is likely to be remembered for decades to come. AutoClassics therefore looks at five of Marchionne’s greatest achievements.

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Firing up Fiat’s fortunes

Marchionne is widely credited with rescuing Fiat from long-term crisis and turning it into one of the world’s fastest growing automobile companies. He became CEO in 2004 saying he would need to double its sales in order to make it financially viable.

Within two years he had returned it to profitability and in late 2006 it paid dividends for the first time since 2002. It was achieved via what Fiat called ‘a clean break with the past’; Marchionne jettisoned non-core businesses and pursued a strategy of targeted alliances after successfully negotiating Fiat out of a broader alliance with General Motors, and getting it to pay $2bn. ‘It was his intellect, perseverance and leadership that saved Fiat,’ noted Elkann.

Restoring Chrysler to health

From 2009 Marchionne performed a similar trick. He secured a deal with then-new US President Barack Obama to take over bankrupt Chrysler without Fiat having to put a penny down, instead it was done in exchange for Fiat’s small car technology.

Fiat Group received a 20% stake in Chrysler Group LLC and Marchionne was appointed CEO. And while it wasn’t always easy and Marchionne’s skills were put to the full test, quickly he hauled Chrysler back to something like stability and it was back in profit within two years. By mid-2011 Fiat became majority owner following the purchase of ownership interests held by the US and Canadian governments.

Bold Fiat-Chrysler merger

Marchionne’s jewel in the crown was the bold trans-Atlantic merger of Italian Fiat and US Chrysler – having turned both around, in August 2014 the pair officially merged under his leadership. The merger was a personal push by Marchionne when many observers doubted that the Italian and American concerns could work as a combined company.

Yet we got Fiat Chrysler Automobiles, by 2016 the world’s eighth largest motor manufacturer in terms of production. Karl Brauer, executive publisher of Autotrader, said in this Marchionne ‘helped illustrate the power of foresight and confidence and being able to make bold moves’.

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‘Kicking ass’ in Formula 1

Marchionne arrived as Ferrari chairman in late 2014 and on the F1 front declared that ‘we’ve got to kick some ass and we've got to do it quickly’, promising plenty of aggression and risk taking. And while his style wasn’t to everyone’s taste, just like in the auto industry it was associated with results.

After a trying 2014 season well off the pace, as early as 2015’s second round Ferrari had against many expectations leapt back to being a race winner. By 2017 it was a front-runner and championship challenger, and that’s how it remains today.

An industry visionary

Marchionne was noted for his sharp automotive industry observations and was not afraid to play iconoclast. Perhaps never more so than in his highly-regarded presentation given in spring of 2015 titled “Confessions of a Capital Junkie – an insider perspective on the cure for the industry’s value-destroying addiction to capital”.

His message was that car manufacturers spend more money on product development and create less value for customers and shareholders than any other industry – investing billions for often small profits. And that as structured the industry was unsustainable and that consolidation is required. It was delivered to analysts over 30 minutes with his typical flair and incisiveness.

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