Three years ago, when Fiat CEO Sergio Marchionne decided he would try to turn around beleaguered car maker Chrysler, he knew it was a long shot. As for any other CEOs in the car business, they wouldn't "have touched this with a 10-foot pole," he tells Steve Kroft. But he took the deal to take a stake in the ailing company from the U.S. government -- part of the Obama administration's auto bailout of the car industry -- and beat the odds. Marchionne takes Kroft through the process of transforming the floundering company into a profitable contender in the world auto market for a 60 Minutes report to be broadcast on Sunday, March 25 at 7 p.m. ET/PT.
The scene at Chrysler was dismal when he arrived. "I remember, when I came here, in 2009, there's not a thing worse for a leader than to see fear in people's faces," says Marchionne, now the CEO of Chrysler as well as Fiat. The workers were afraid they would lose their jobs and he was taking on the responsibility, the daunting challenge of saving those jobs by resurrecting a moribund company. "There wasn't a CEO in the world from the auto side that would have touched this with a 10-foot pole," says Marchionne.
Chrysler was losing money and market share and had gone into chapter 11. It lacked the technology to provide the smaller, more efficient, fuel-saving vehicles the market was demanding. Its very existence and the 54,000 jobs it represented were in jeopardy. It was a long shot, even for Marchionne, who had turned around legendary Italian automaker Fiat. "All these things are long shots...If it was that easy, then everybody would do it," he tells Kroft.
One of his crucial first steps was to cut the layers of Chrysler's bureaucracy, long a cause of lethargy among Detroit's Big Three. Using a $6 billion loan from the U.S. Treasury, he began to refurbish factories and to improve quality. He upgraded 16 of Chrysler's models in just 18 months. He then began to combine the efficient technology that his Fiat factories were using with the retooled Chrysler plants.
The result of this Fiat alliance and his streamlining of the managerial process will be a new Dodge Dart that costs under $16,000 and gets 40 miles per gallon. From design to full assembly, to start next month, took just three years - an unheard of time frame for a Detroit automaker. And it's more jobs for the Belvidere, Ill. plant making the Dart and other Chrysler plants and suppliers. "We will have brought in over 4,000 blue collars since we came out of bankruptcy," says Marchionne.
He is even going to sell some of those Darts overseas under the Fiat name. Profits are flowing again and so are the prospects for his workers. "It's been a long, rocky road; but the fear has gone, says Marchionne of his formerly worried workforce. In the end, he couldn't have done it without them. "I think the world of American workers. What happened here at Chrysler would have been impossible without the commitment that they've shown, absolutely impossible."