In 2009, Chrysler was sputtering toward collapse, with tens of thousands of jobs in jeopardy. But one man bet that he could save the company and make it profitable again. He's Sergio Marchionne. He'd already turned around Fiat and felt the two companies were a good fit -- and clearly he likes a good challenge. So Marchionne took a $6 billion, high-interest U.S. Treasury loan and promised to pay it all back by 2017. Chrysler beat the deadline by six years. Steve Kroft interviews Marchionne as Chrysler rolls out a new car.
The following is a script from "Resurrecting Chrysler" which aired on March 25, 2012 and was rebroadcast on Sept. 2, 2012. Steve Kroft is the correspondent. Frank Devine and Maria Gavrilovic, producers.
One of the most encouraging signs in the U.S. economy over the past year has been the resuscitation of the American automobile industry from a near death experience and in many ways the most dramatic recovery has been Chrysler's.
Three years ago the company was headed for the junkyard crusher, leaking cash and about to be scrapped, unloved and unwanted. But last year, Chrysler turned a $183 million profit and would have made a lot more if it hadn't decided to repay its $6 billion federal bailout, six years ahead of schedule. As we first reported in March, much of the credit goes to U.S. taxpayers, and to Chrysler workers who accepted wage and benefit cuts. But none of it would have happened without the efforts of a 60-year-old, Italian born and Canadian raised auto executive named Sergio Marchionne, who engineered a last minute partnership with Fiat, and an American style success story.
With his gray stubble, longish hair, relaxed demeanor and trademark black sweaters, Sergio Marchionne looks more like a film director than an auto executive, but he is now the industry's biggest star. The CEO of Fiat had already rescued that company from financial ruin, and in Chrysler Marchionne saw at least one similarity -- both companies had been through hell.
Sergio Marchionne: I remember when I came here in 2009, there's nothing worse for a leader than to see fear in people's faces. It's been a long, rocky road, but the fear is gone.
Steve Kroft: What were they afraid of?
Sergio Marchionne: Of not being here. Alright? It's that simple. This was really a question of existence. There's nothing worse in life than to sit there and be the victim of a process that's outside your control.
And that was exactly the situation at Chrysler in early 2009 when Marchionne began negotiating with the federal government over a controlled bankruptcy of Chrysler that would allow Fiat to take over the failing auto company. It was the last hope for Chrysler and its 54,000 employees.
Sergio Marchionne: There wasn't a CEO in the world from the car side that would have touched this with a 10-foot pole.
Steve Kroft: Gave you a little leverage?
Sergio Marchionne: It gave me some leverage and a whole pile of downside risk. For you to be the only guy at the bar, there's gotta be a reason, right?
Steve Kroft: Did you think it was a long shot?
Sergio Marchionne: All these things are long shots. All. If it was that easy, then everybody would do it.
Steve Rattner: If Sergio had not appeared, I think it's very likely Chrysler would have been allowed to liquidate.