“It will be difficult but we will find the right person to act as CEO. Trust me”. Sergio Marchionne thus answers questions about his succession at the Amsterdam assembly of Fiat Chrysler in which the objectives were confirmed at the end of 2018, the last year of the management of the CEO who has governed the fate of the company since 2004: revenues net equal to approximately 125 billion euros, a ebit adjusted exceeding 8,7 billion euros, a Net income approximately 5 billion euros and net industrial cash of almost 4 billion euros at the end of the year, which will make it possible to achieve the manager's latest "mission impossible", namely the elimination of net industrial debt.
And so the Italian-American group is on its way to closing with success five-year planwaiting for the new one, to be announced at the beginning of June, which Marchionne is about to bequeath to his successor. "We have met or exceeded all major goals in each of the five years of the plan - explained the manager at the meeting - FCA achieved a record adjusted EBIT, increasing its margin by 90 points, almost doubled its net profits and almost halved its industrial debt. In terms of products, we have increased our competitiveness with several significant model launches”.
Exceptional results that justify a bit of suspense in the last bars. Not only in FCA, given that in the morning the board of CNH did not name CEO Richard Tobin's successor, resigned, who will formally remain in office until the quarterly report of 27 April. For the time being, Chief Operating Officer Derek Neilson will take his place, pending the new CEO. Meanwhile, the company, grappling with the US duties on trade with China (vital for the group as well as for the giants Caterpillar and John Deere) closed the year with revenues of 28 billion dollars, net profit of 477 million and will pay a dividend of 0,14 euros per share, for a total of 190 million euros (234 million dollars).
Il full nominations, in the face of these successes, it has a relative value and urgency: it is evident that Marchionne, even with a view to exiting in a year, remains the point of reference in the galaxy of industrial holdings owned by Exor.
“We are working with the board to ensure that next year there is the best succession possible,” he comments John Elkann.
“We are well aware of the difficulties that exist, for any company and in particular for FCA. It will be difficult but we will find the person capable, dedicated, suitable, trust me”, Marchionne said. “We have worked hard to select good leaders to bring to the company. It is a theme that has been in my thoughts for years. What I see encourages me but the moment is difficult, it is difficult to find compared to 2004. When I arrived at FCA I was the fifth CEO in 24 months. We must avoid solutions of this type”.
Beyond the names (favorites Richard Palmer, the English CFO, and Mike Manley, Jeep's number one, follows at a distance Alfredo Altavilla, consortium for Tim's board together with the fund Elliott), the feeling remains that the group, archived with success the integration between the Fiat culture and that of the USA, must today face a new environment where the challenge is not played only or above all on scale, but on the ability to create alliances or focus on the right focus, concentrating investments and technology without ever neglecting the interest of shareholders, attentive to the return on equity more than a junkie looking for his hustler.
In this game Marchionne proved to be a master, as demonstrated by the various spin-offs, from Ferrari to next Magneti Marelli operation (but also Rcs) which have brought value to the shareholder, meanwhile creating the conditions for greater strategic value for Exor. So much so that the insatiable shareholders are already betting on the make up of CNH Industrial through the Iveco spin-off, the most fragile component of the group, very strong in construction equipment and agriculture, but weak in heavy trucks, after having given up on too expensive acquisitions (see Navistar in the USA).
Iveco, competitive in lighter transport, could become the object of desire for Daimler or heavy vehicles from Volkswagen, in the odor of quotation to support the immense technological effort of Wolfsburg (the group alone invests more than the entire Italian industry). Both Marchionne and Elkann have denied the hypothesis of this or other stews. "The global market is showing signs of growth in demand for our products and services - said the CEO - We will adapt commercial strategies to respond to consumer demands and face competitors head-on", just as he likes it more and more passionately at the races of “his” Ferrari.
