Fiat selects new CEO, makes commitment to restructuring

ROME — Fiat on Tuesday chose turnaround expert Sergio Marchionne to be its chief executive as the struggling automaker reshaped top management in the wake of the death of chairman Umberto Agnelli and the resignation of the previous CEO last week.

In an effort to reassure investors, Fiat's new management also pledged commitment to a restructuring plan that has been helping to pull the company out of its worst financial crisis ever. News of Marchionne's appointment, ending two days of uncertainty at Italy's largest private employer, sent Fiat shares up more than 4 percent on the Italian stock market.

"Fiat has had problems and it still does," Marchionne said after his appointment as Fiat's fifth CEO in two years at a board meeting at the company's Turin headquarters. But, he added, "I am absolutely convinced that Fiat will make it and will be again what it always has been."

"It's a plan we intend to complete," he said of the company's restructuring efforts.

Fifty-one years old and with dual Italian and Canadian citizenship, Marchionne is known as an aggressive executive and turnaround expert. He has been on Fiat's board of directors since 2003.

He is "an international manager with a clear strategic vision and a strong ability for organization," said Gabriele Galateri, the head of Italian merchant bank Mediobanca and a former Fiat executive.

Marchionne started his career in Canada and later went to Switzerland, where he headed the Lonza chemicals group and then became chief executive of goods inspection and testing company SGS in 2002.

On Sunday, Giuseppe Morchio abruptly resigned as CEO to protest board changes made after Agnelli's death.

The changes included the choice of Ferrari chief and longtime Agnellis' friend Luca Cordero di Montezemolo as Fiat's new chairman, as well as the appointment of John Elkann, who has been groomed to someday lead the Fiat empire, to the group's vice presidency at the age of 28.

Morchio, who had been cited as a possible candidate for chairman, reportedly wanted a bigger role in the company. He was largely credited with devising and implementing the company's restructuring plan, and his resignation cast a cloud on Fiat's future, sending Fiat's shares down more than 3 percent during the trading session Monday.

The new management was quick to issue assurances that the restructuring would go ahead.

"We have tried to be very quick in order to guarantee stability and continuity to Fiat's restructuring plan, which we'll bring forward," Elkann said Tuesday, echoing comments made by Montezemolo.