With the death of Sergio Marchionne, Mike Manley will take on the challenges of the world’s seventh-largest automaker, which just lowered its profit projections.
Even for an auto executive, Mike Manley has strong views about how a car should look and feel.
Around 2009, the car was a Jeep Grand Cherokee, the first big product launch since Chrysler had been cast off by Daimler after their ill-fated merger. Manley, who had been in charge of product planning, took a test vehicle to the company’s proving grounds near Ann Arbor, Michigan, with Jim Press, then co-president of Chrysler, and a couple of engineers.
“We all felt really pretty good about the car; it’s got everything we wanted,” Press recalled. “Mike drove it and said, ‘Nope, the steering wheel’s not big enough; it doesn’t feel like a Jeep.’ ”
Mike Manley, CEO of Fiat Chrysler
Education: Engineering degree from London South Bank University; MBA from Ashridge Management College
Career: Worked 14 years in car dealerships before being hired to run Daimler=Chrysler’s U.K. dealer network in 2000. Made vice president of dealer operations in 2003. Later put in charge of two key moneymakers, the Jeep and Ram lines.
Source: Bloomberg News
A decade later, Jeep has been revitalized in the U.S. and expanded into a global powerhouse. It’s the key sales driver for Fiat Chrysler Automobiles, as well as the linchpin in the company’s plan to double profits in the next five years. Manley, a 54-year-old Briton, was picked by Chairman John Elkann, the scion of Fiat’s founding family, to replace a gravely ill Sergio Marchionne last weekend. Marchionne died on Wednesday.
Running a car company requires not just the instincts of a salesman but also the deft touch of a politician. So Manley will have to show Wall Street he’s more than just a prolific seller of Jeeps and Ram pickups.
His elevation means navigating through numerous minefields: President Donald Trump’s trade policy, doubts in Italy about whether the first non-Italian CEO can run the 119-year-old company, and the existential questions over whether Fiat Chrysler needs a partner to help with investments in electrification and surviving technological disruption from autonomous vehicles.
“We’ve only seen the operational side of Manley,” said Philippe Houchois, an analyst at Jefferies Group in London who’s been covering the company for 17 years. “We haven’t seen his ability to take it to a higher level. The job of CEO is quite political and complex.”
Manley has been on the list to replace Marchionne for years. At the 2016 North American International Auto Show in Detroit, Marchionne said he was “squeezing out’’ his potential successors, and whoever survived would become CEO after his departure.
Asked then if he was ready to take over the legacy of Marchionne, who ran Fiat Chrysler for 14 years and engineered the transatlantic merger that saved both companies, Manley replied: “I’ve been working with him since 2009 and it’s a business education you couldn’t pay for. You have to live it and live it with him,” he said. “We live in a tough environment, but it’s an environment I’ve very much benefited from.”
Manley is expected to share the burden of replacing Marchionne with Chief Financial Officer Richard Palmer, who had been Marchionne’s alter ego with investors.
Marchionne, who defied skeptics by repeatedly setting and meeting audacious profit targets, is almost worshipped on Wall Street for increasing shareholder value more than tenfold.
On the last earnings call, one analyst begged him to remain in the job past his planned retirement date of April 2019. Another declared on the eve of his final five-year strategy presentation in June that Fiat Chrysler “is not a company: It’s the man.”
But Marchionne made a point of having his executives wear multiple hats to break down silos and help groom them for bigger responsibilities. Manley has worn quite a few.
Born in 1964 in Edenbridge, a small town about an hour and a half’s drive south of London, he graduated from London South Bank University in 1985 with a degree in engineering and later earned a master’s in business administration from Ashridge Management College. He spent 14 years working in car dealerships before being hired to run DaimlerChrysler’s U.K. dealer network in 2000.
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Sean Nevatte, who worked with Manley at a Lex Vauxhall dealership in the mid-1990s, remembers him as “extremely hands-on” and sometimes “fiery, but very controlled with it.”
“Everyone knew how ambitious he was,” Nevatte said.
Manley moved to the U.S. in 2003, initially to become vice president of dealer operations, with more responsibilities coming later. In 2009, after Fiat had taken control of the post-bankruptcy Chrysler, Marchionne gave Manley the Jeep brand.
He joined the company’s General Executive Council, its highest decision-making body, in 2011, and became head of the Asia-Pacific region. In 2015, he added Fiat Chrysler’s other cash machine, its Ram truck brand, to his portfolio.
It was during those early years in the U.S. that Manley began to earn the trust of Fiat Chrysler’s 2,640-strong dealer body, a group he has consulted frequently to keep his finger on the pulse of the market.
They say it’s not unusual to wake up to a text message from him asking how a certain model — the Jeep Compass or the Ram 1500, say — is being received in a particular market.
Cass Burch, who owns a handful of Chrysler, Jeep, Dodge and Ram franchises in southern Georgia, dropped in on Manley at the Auburn Hills, Michigan, headquarters in late 2014 or early 2015.
Manley spent an hour and a half with him in Fiat Chrysler’s high-security design studio in the bowels of the corporate complex, laying out the entire new Jeep product line. At the end of it all, Manley looked intently at Burch and asked what he thought.
“It makes you start qualifying what you’ve got to say, because you realize they’re listening,” Burch said. “You need to be sure that the input you’re giving, you’re willing to go to the wall with it.”
Still, the Jeep guru is not without his missteps. As he was overseeing Jeep’s global expansion in 2011, Marchionne gave Manley another massive task: expand Fiat Chrysler in Asia after more than a decade of failed attempts. Even Manley didn’t manage to meet the targets set for the region. The local production of Fiat sedans in China was a flop, and Jeep itself had a weak start. Manley was replaced as Asia chief in 2017.
The world’s seventh-largest automaker, Fiat Chrysler will have to make great strides in China if it wants to keep up with competitors and make good on its most recent profit and sales goals. That challenge came into sharp focus for Manley on his debut earnings call earlier last week, when Fiat Chrysler lowered its profit outlook after dismal Jeep sales in China.
“It will take the balance of the year for us to really see the progress that I’m looking for. But the good news is, I think we know what” the problems are, Manley told a somber group of analysts just hours after news of Marchionne’s death became public. “We can certainly fix them.”