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Marchionne to lead Ferrari as Montezemolo resigns

Parting ways: Luca Montezemolo (right) announces his resignation alongside Sergio Marchionne, who will replace him as chairman of Ferrari.

Montezemolo steps down as Ferrari chairman after 23 years in the saddle

Ferrari logo11 Sep 2014

LUCA Cordero di Montezemolo will resign as chairman of Ferrari next month, handing the reins of the famous Prancing Horse brand to Fiat Chrysler chief executive Sergio Marchionne.

After leading the hallowed Italian brand for the past 23 years, Mr Montezemolo’ s departure was not unexpected after mounting speculation over his future in recent weeks, including reports that he was a strong candidate to head up Italian airline Alitalia.

Earlier this week, Mr Marchionne publicly criticised Mr Montezemolo for telling Italian media that he was available to serve for another three years but would also be the one to announce any news on his future “if and when” that was necessary.

Mr Marchionne was subsequently quoted as saying that “nobody is indispensable”. He also said the recent disappointing performance of Ferrari’s Formula One racing team was “unacceptable” and that F1 race wins were “absolutely non-negotiable”.

Overseas reports suggest the two executives have disagreed on a range of issues over the past decade and that trigger points for the resignation included Mr Montezemolo’s opposition to the ‘Americanisation’ of Ferrari via Fiat’s merger with the Chrysler Group, and the prospect of a public share float of the supercar marque, which is currently 90 per cent owned by Fiat.

Despite denials, Mr Marchionne is said to have left the option of an initial public offering on the table.

Company executives familiar with the matter have also cited a disagreement over production numbers for Ferrari – currently limited to 7000 cars a year – and shared components and engineering resources with other Fiat Group brands.

Mr Montezemolo is described as a staunch defender of Ferrari’s exclusivity, while Mr Marchionne is prepared to increase production and hence reduce waiting times where required in order to avoid giving competitors, such as Volkswagen-owned Lamborghini, an advantage.

He is also the key figure behind the newly merged Fiat Chrysler Automobiles’ (FCA) ambitious five-year plan announced in May that calls for a 60 per cent increase in global sales to about seven million vehicles a year.

Mr Montezemolo, who served as Fiat Group chairman from 2004 to 2010 and, tellingly, was not appointed to the board of FCA, will officially step down on October 13 – the same day that FCA plans to list on the New York Stock Exchange.

“Ferrari will have an important role to play within the FCA Group in the upcoming flotation on Wall Street,” he said in a statement.

“This will open up a new and different phase which I feel should be spearheaded by the CEO of the group.

“This is the end of an era and so I have decided to leave my position as chairman after almost 23 marvellous and unforgettable years in addition to those spent at Enzo Ferrari’s side in the 1970s.” In paying tribute to the outgoing Ferrari boss, Mr Marchionne said their “mutual desire” to see Ferrari succeed on the F1 racetrack had “led to misunderstandings which became clearly visible over the last weekend”.

“Luca and I were appointed to the Fiat board of directors on the very same day back in 2003,” he said.

“One year later, he became chairman and I became CEO. We worked side by side, sharing concerns, difficulties and successes.

“As chairman of Ferrari, he drove the company to a new level of technological and organisational excellence which also brought with it outstanding financial results.

“Luca and I have discussed the future of Ferrari at length and our mutual desire to see Ferrari achieve its true potential on the track has led to misunderstandings which became clearly visible over the last weekend.

“I want to thank Luca for all he has done for Fiat, for Ferrari and for me personally.” Mr Marchionne has confirmed that his rise as chairman of Ferrari, in addition to his current responsibilities, is a permanent move.

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