OUR BLOG: What next for Fiat Chrysler as Marchionne stands down?

  04 June 2018

How did it ever get to this? Like the unfortunate left standing against the wall at the school dance while everyone else enjoys themselves, Fiat Chrysler has been looking for a partner to join forces with to meet the financial and technical challenges of this century but with a marked lack of success.

This week its charismatic leader, Sergio Marchionne, stands down after a sometimes tempestuous, often turbulent but unfailingly energetic and interesting time at the helm. For some 14 years he has steered the good ship FCA into profit after turning around the basket case that was Chrysler and made parts of it (Ferrari) stock market darlings.

As a parting gift he unveiled his Five Year Plan (ominous overtones of Soviet-era economic planning but we’ll leave that there!) with new Alfa and Maserati models including some halo sportscars and yes, electrification. Finally.

But there is an underlying and fundamental weakness in the group that no amount of rising share value or headline grabbing announcements can hide – FCA stands alone.

Marchionne is talking of spending the thick end of £8 billion to cover the cost of this new direction, leaving his successors with a nice headache to deal with.  It needs to fast track electrification or even hybridisation to catch up with the other European and Far Eastern brands but there is no obvious way to do that.

For me though there is another issue though which the Italian car maker must address which is every bit as fundamental as developing EVs, and it is the quality and reliability. Last year I had a brand new Alfa Romeo Giulia on test. It was delivered with a fault in the electronic dampers and later that day the stop/start system stopped but wouldn’t start. Three times. Two days later it was swapped for a Jeep Cherokee – which broke down. A colleague had Alfa’s Stelvio SUV on test and was not impressed when the trim beneath the steering column dropped onto his shins. These are not isolated cases.

And Alfa wants to take on Lexus and the Germans?

Sergio Marchionne has achieved miracles in generating profit from the ashes of Chrysler and pulling the group forward, no small achievement at any time let alone in the post-2008 crash environment.

But will his legacy be that or the lack of anyone prepared to sign the marriage register with FCA?

imageTags: FCA, Marchionne

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