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Shares in Fiat Chrysler drop as group head steps down due to serious illness

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Shares in Fiat Chrysler drop as group head steps down due to serious illness
Former Fiat Chrysler Automobiles CEO Sergio Marchionne (L) unveils the new Alfa Romeo Sauber Formula One Team in 2017. Photo: Marco Bertorello/AFP.
14:33 CEST+02:00
Shares in auto giant Fiat Chrysler dropped on the Milan stock exchange on Monday July 23rd, after its boss of 14 years Sergio Marchionne stepped down at the weekend due to serious health issues.

As trading got under way, sister companies Fiat Chrysler Automobiles (FCA), Ferrari and CNH Industrial saw their shares dip over 4 percent each. The three groups are controlled by the Agnelli family.

By 10:50 am (0830 GMT), FCA's stock had recovered significantly, edging upwards to a 1.4 percent loss. Ferrari was down 1.8 percent while CNH Industrial lost 2.3 percent.

The losses came after Marchionne stepped down Saturday after 14 years at the helm of Fiat. The 66-year-old suffered serious complications following surgery on his right shoulder last month and "will not come back to work," according to the Fiat Chrysler group. The Italian-Canadian executive had taken the reins at Fiat in 2004.

He revamped Fiat, Italy's premier private enterprise, from top to bottom. In 2009, he merged Fiat with US automaker Chrysler, then hived off its industrial vehicles to create CNH Industrial in 2011 and successfully spun off the luxury brand Ferrari in January 2016.

'More than a car guy'

Marchionne will be replaced as FCA boss by Briton Mike Manley, head of the iconic Jeep brand. The new head of the luxury carmaker Ferrari will be Louis Carey Camilleri, CEO of tobacco giant Philip Morris. The cigarette-maker has sponsored Ferarri for four decades.

Suzanne Heywood will take over as the new boss of CNH Industrial, which specialises in agricultural and construction equipment, trucks and buses. Marchionne had already been planning to step down next year.

But experts have cast doubt on the ability of Marchionne's successors to keep up the momentum he had built up over the years. German auto expert Ferdinand Dudenhoeffer described Fiat Chrysler as "a weak company and now with Marchionne's departure, it has become even weaker."

His successor at the helm of the sprawling FCA, Manley, "is no Marchionne," Dudenhoeffer said. Manley "is a car guy, and to manage Fiat Chrysler you need more than just a car guy," he said. 

READ MORE: Italian media and politicians hail Marchionne as Fiat era ends

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