Fiat Chrysler Faces Challenge of Replacing a Visionary Leader

Bryan Perry

Fiat Chrysler Automobiles N.V. (NYSE:FCAU) is facing a huge challenge to sustain the remarkable resurgence it achieved under the leadership of its visionary former CEO Sergio Marchionne, 66, who died unexpectedly on July 25 after complications from shoulder surgery related to a serious illness.

Automobile industry analysts currently have ratings ranging from buy to sell on Fiat Chrysler’s shares, but its near-term outlook seems stable due to the existence of a 2019-22 strategic plan put in place prior to Marchionne’s health crisis. In addition, Fiat Chrysler had been planning on a leadership transition to coincide with Marchione’s planned retirement in April 2019 that would have elevated current key executives who now will be taking on increased responsibilities sooner than expected.

Another factor that enhances Fiat Chrysler’s financial future is its decision under Marchionne’s guidance to preserve precious capital by partnering with other companies on electric and self-driving vehicles. The latter strategy positions Fiat Chrysler as a potential merger candidate with another automobile manufacturer that may want to acquire brands that include Jeep, Ram trucks and Maserati sports cars that gained increased popularity under Marchionne’s tenure.

Mike Manley, who led the company’s profitable Jeep and Ram brands, was named CEO on Saturday, July 21, one day after company officials were told that Marchionne’s condition had deteriorated and that he would not be able to return to work.

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Paul Dykewicz, www.pauldykewicz.com, is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, the Journal of Commerce,Seeking Alpha, GuruFocus and other publications and websites. Paul is the editor of StockInvestor.com and DividendInvestor.com, a writer for both websites and a columnist. He further is the editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul previously served as business editor of Baltimore’s Daily Record newspaper. Paul also is the author of an inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz.

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