VIENNA -- European companies can compete against anybody in the world if they have the right attitude, Fiat Auto CEO Sergio Marchionne said.
"There's an emerging sense of defeatism, especially in major European markets such as France, Germany and Italy," Marchionne told the Automotive News Congress on Wednesday. "This must be stopped at its roots."
Marchionne said that when he was hired to take charge of Fiat nearly two years ago he had to battle that feeling of defeat at the company.
"I spent my first 60 days traveling from plant to plant to see how deep the hole was that was losing us 3 million euros ($3.8 million) a day," he said.
He stopped the huge loses by changing Fiat's management and the company's overall management style.
"The new type of leadership is our instrument of change, (it is) the key to the transformation of the Fiat group," Marchionne said. "We have dismantled the traditional hierarchy, and now the auto side is run by just 27 leaders. Many of these leaders are under 40. We have speed, simplicity and confidence."
Fiat is on course to make an operating profit of 200 million euros, or about $253.4 million at current exchange rates, this year. In the first quarter, the carmaker reported a 57 million euros, or $72.2 million, operating profit, compared with a loss of 129 million euros, or $163.5 million, in the first quarter of 2005.
Marchionne said his changes, "have moved Fiat from the threat of extinction. But now, the real work begins. Only now, after nearly 24 months, are we beginning to intervene on the industrial side to address our margins."