Italian automaker Fiat, which controls Chrysler LLC, announced Tuesday that Agnelli family heir and company vice chairman John Elkann will move up to become board chairman. Fiat also owns between 85-90% of farm equipment maker CNH Global and its two major brands Case IH and New Holland Agriculture.
Fiat SpA said its board will formally approve the pick of the 34-year-old Eklann at a meeting on today. That same day, Fiat presents a 5-year business plan, including new models and tighter integration with Chrysler.
Earlier on Tuesday, Luca Cordero di Montezemolo, chairman since 2004, announced he was stepping down.
"Today, Fiat is a healthy and competitive company that has grown in all its sectors," Montezemolo told reporters. "There's no more drama about the company being close to bankruptcy."
After news reports earlier anticipated the changeover, Fiat shares jumped 3.7% to euro 9.89 in Milan trading on the report.
The Agnelli family owns the controlling stake in Fiat, and Elkann's grandfather, Gianni Agnelli, ran the company for decades. It had long been expected that the 34-year-old Elkann — who was appointed vice chairman in 2004, the year after his grandfather's death — would take a greater leadership role.
Elkann has served on the board since December 1997, and his appointment as vice chairman followed the arrival of CEO Sergio Marchionne, who turned the company around after years of financial losses and who is now striving to make Fiat a global automaker producing 5.5-6 million cars a year.
The deal to take an initial 20% stake in Chrysler last year was a key step, and the business plan Wednesday is expected to provide greater details on his strategy for the alliance.
Over the last half a decade, Elkann has been working closely with Montezemolo and other executives to learn the ropes, and keeps an office in the same wing of Fiat's headquarters in Turin as Marchionne and Montezemolo.
Elkann also heads the family's Exor holding company, through which the Agnelli heirs hold a controlling 30% stake in Fiat and other interests, including the Juventus soccer team and La Stampa.
Montezemolo is also chairman of Ferrari, which is majority owned by Fiat, since 1991 and was also its CEO until 2006. He previously served as chairman and CEO of Maserati, another Fiat brand, as well as president of Italy's industrial lobby Confindustria.