Fiat gives departing Ferrari chairman $34.78 million as severance pay image

Fiat Chrysler will give to the departing chairman of its sports car division Ferrari a combined severance package of €26.95 million ($34.78 million), with half of it to be paid in a single installment by next February.

Luca Cordero di Montezemolo, chairman of Italian luxury sports car maker Ferrari, has announced his decision to resign. He will be replaced by Fiat Chrysler’s CEO, Sergio Marchionne, after the two clashed over the brand’s strategy and also on Formula One’s team not so great results. His decision comes a few days after denying the rumors regarding his departure and also after a statement from Marchionne saying that Ferrari’s chairman departure was not on the agenda, while adding though that no one is indispensable.

Fiat stated that Montezemolo will receive a lump-sum payment of €13.25 million by January 31, 2015 in return for agreeing not to compete against Fiat until March 2017. Fiat also added that Montezemolo will receive another €13.71 million, five times his annual salary as Ferrari’s lead, payable in 20 years. The outgoing Ferrari Chairman said on Wednesday that becoming Alitalia’s Chairman is a possibility, but that he would decide on this after leaving the sports car maker on October 13. The CEO of UniCredit, one of the main shareholders of Alitalia, stated that Montezemolo would be a good candidate for the chairmanship of the company.

By Gabriela Florea