It's not the fine-dining experience you might expect an Agnelli would prefer. The anointed heir to Italy's greatest industrial fortune is settling into his chair at Vittoria, a homespun Turin trattoria where plates clank every time the nearby kitchen door swings open. But for John Elkann, the 30-year-old vice chairman of both Fiat and IFIL, the Agnelli family's €6 billion holding company, this is the perfect place for a power lunch. After ordering his favorite Vittoria dish — a lightly fried veal cutlet with fresh tomatoes — Elkann leans in to better explain his choice. "You know why I really like this place?" he says, lowering his voice and widening his eyes. "Because it's fast."

Those are the words of a young man on the move. It's been nine years since he was handpicked by his grandfather, Giovanni "Gianni" Agnelli, to be next in line to take the reins of the family's automotive and financial empire. And while Fiat's fortunes have rollercoastered, Elkann has been methodically groomed into what many hope will be one of Europe's top business leaders for decades to come. Guiding an entrenched business dynasty

404 Not Found

---

nginx/1.14.0 (Ubuntu) in a competitive global marketplace is a tall order for the tall executive, a lofty 1.9 m though still baby-faced. "He is now the point of reference for what is quite a sprawling family empire," explains Giuseppe Berta, professor of economic history at Milan's Bocconi University, and author of the recent book, The Fiat After Fiat. "This is a delicate moment. Elkann is still rather young, and there are some conflicting ideas within the family about their holdings. But he is the only one who can lead them into the future."

Of course, the prize is not yet Elkann's. While both his decision-making role and public presence have recently begun to swell, Fiat chairman Luca di Montezemolo and ceo Sergio Marchionne are still largely in charge. The Fiat Group, which counts CNH tractors and Iveco trucks among its holdings, has been buoyed recently by strong numbers from its once-suffering automobile division. Under the turnaround leadership of Marchionne, in the first five months of the year, European sales of the auto group (which includes the Fiat, Lancia and Alfa Romeo brands) jumped 23.2% over 2005 numbers, to around 520,000 units, representing nearly half of overall company revenues. And that's at a time when economic uncertainty has many Europeans putting off major purchases such as cars.

With Fiat now rolling toward recovery — and his increasingly central role both in the holding company's day-to-day management and the dynasty's long-term destiny — Elkann decided to give his first-ever extensive interview. Over the course of several encounters in Turin and Rome, he spoke with Time about his rapid rise in Italy's leading business family, Fiat's struggle to adapt to a shifting global playing field, and a young man's relationship with his famous silver-haired grandfather.

The death of this formidable figure and of Gianni's younger brother Umberto Agnelli, both from cancer within a 16-month span, created the vacuum that forced Elkann — the eldest child of Gianni Agnelli's daughter Margherita and French-Italian writer Alain Elkann — to step to the fore ahead of schedule. He did so amid the company's two-year crisis that came, in 2002, from weak management and damaged brand image, and forced a €3 billion bank bailout to stave off potential bankruptcy. "If the situation had been different, I might have had more time to ease into the job. But I was forced into the middle of a bad moment," Elkann says. "The company was being mismanaged. The family leadership was aging and sick.The financial community didn't support us anymore. At that point, you have the choice to let it go or you try to fix it."

The public outpouring in Italy when his grandfather died, with top political leaders and ordinary citizens flocking to the wake and funeral, sealed the family's decision to commit to Fiat's future — even if it meant the hard work of selling assets, overhauling management and reinvesting in the core company, hardly the typical Italian way of doing business. "This country paid a great tribute to my grandfather," Elkann said. "It was a family feeling to respond."

Though it unfolds like a Victorian play, Elkann insists that his ascendancy to the Fiat throne was "very natural." Born in New York City and raised in Britain, Brazil and France, he returned to his parents' hometown of Turin to study engineering at the rigorous Politecnico University. That was when Elkann began to pass Sundays on the family yacht and afternoons at the Fiat offices with Agnelli, who was then still Fiat's chairman. Speaking from his corner office — the same space at company headquarters Agnelli once occupied — Elkann recalled how he first inched into the family business under his grandfather's watch. "I saw him here, or maybe on the boat," he said. "I would ask questions, and he always responded."

Not yet 20, it was clear that he had a deep drive for business. Between his university exams, Elkann would forego vacations to embark on internships within the company's holdings — at a Birmingham headlight plant, a Lille Fiat dealership, a Krakow assembly line. "It was a gradual process of being tested and wanting to be tested," Elkann recalled. "[Agnelli] saw that I was committed to the work. He believed you should do what you like doing in life. He believed in people developing the capabilities they're most suited for."

In the Agnelli bloodline, that often means entrepreneurialism. Fiat was founded in 1899 by Giovanni Agnelli, a wealthy Turinese landowner, who imported Henry Ford's assembly line. He chose Gianni, his grandson, as his business heir after Gianni's father was killed in a 1935 plane accident, just as Gianni would later anoint Elkann. With his aquiline features and elegant but easygoing manner, Elkann certainly evokes his grandpa, among the 20th century's most admired business leaders and the epitome of globetrotting savoir faire. Henry Kissinger, a longtime close Agnelli friend, says it's too early to try to measure Elkann up to his legendary forebear. But having known the grandson since he was 12, Kissinger says Elkann has all the tools to become a formidable leader. "He is extremely intelligent and has a great sense of responsibility," Kissinger told Time. "I've seen, in the past few years, he has managed several crises with extreme dignity and wisdom."

Such leadership is vital in a dynasty with a Kennedyesque whiff of tragedy. The originally anointed successor to Gianni Agnelli was Umberto's eldest son, Giovanni Alberto, who died rather suddenly from fast-spreading stomach cancer in 1997 at 33. Gianni's only son, Edoardo, who battled depression and did not partake in the family business, committed suicide by jumping from an overpass in 2000. Just last year, Elkann's younger brother, Lapo, head of Fiat marketing, nearly died from a cocaine overdose.

Elkann absorbed himself in business instead. After getting his degree, Elkann entered General Electric's highly competitive Corporate Audit Staff program, where he mixed with other future business leaders and got hooked on high finance. Back at Vittoria, as he zips through his lunch, Elkann extols the benefits of knowing the books. "Finance is applied to everything," he says. "Look at this restaurant: maybe it seems overstaffed, but then you see that they move people in and out quickly, and you know that has a value." One factor that Elkann is indeed constantly weighing is time. His Blackberry is in subtle but continuous motion, out of and back into his jacket pocket. Elkann says his grandfather, who is universally remembered for his graciousness, could also cut you short. "The problem is speed," he explained. "He was impatient. He had a capacity to get to the point, and always wanted to get to that which is essential without wasting time." That's how Elkann often sees dining. "Long meals I find to be painful," he says.

Working largely behind the scenes, Elkann has focused recently on the family's holding company, IFIL, Italy's largest company, with stakes beyond the car business in banking, corporate consulting and publishing. Increasingly, though, the new capofamiglia of the Agnelli dynasty is spreading his wings. Elkann was one of just a handful of executives quoted in the press after last month's keynote address by new Bank of Italy governor Mario Draghi. Three weeks ago he participated for the second time at the annual Bilderberg meeting, an invitation-only gathering of the international business and political élite. Elkann also got high marks for his firm — and unusually public — response to the recent match-fixing scandal consuming Italy's top football club, Juventus, which the Agnelli family has owned since 1923.

At the team's first match after evidence emerged that Juventus' former general manager Luciano Moggi had allegedly pressured referees, Elkann gathered reporters at the stadium to gracefully, but clearly, voice his no-confidence in the then management. He has since named a completely revamped Juventus board and a new team code of ethics. Most importantly for the long-term strategy, Elkann spearheaded the family's decision last September to push their stake in Fiat back above 30% for the first time since the bank bailout.

Elkann has been working hand in hand with IFIL chairman, Gianluigi Gabetti, 81, among Agnelli's closest confidantes. The pair picked Marchionne, the man largely responsible for the car company turnaround. Besides launching two successful new models, the Panda and Grande Punto, and streamlining management, Marchionne personally negotiated the deal that forced General Motors to pay out $2 billion to Fiat to free itself from a put option in the companies' 2000 joint-operating accord that could have forced the U.S. automaker to buy the Turin company outright. In the coming years, however, Elkann is expected to become the singular face of Fiat. "Because of his background, John's international mentality is not a question of schooling, it's a natural part of who he is. This is a great advantage," Montezemolo says of Elkann.

More than ever now, the dynasty's future will be anchored by the eldest Elkann, known to friends and family as "Jaki." But it won't always be smooth sailing. His second cousin, Andrea Agnelli, also 30, son of Umberto and a Fiat board member, publicly contested Elkann's decision to up the family stake in the automaker. Differences of opinion are part of every family, Elkann notes, but insists that he aims to bring all into the fold, citing his grandfather's views. "He believed that leadership is consensus," Elkann said. "He won the support of the family and business partners and the community. He believed you lead by getting the best from the people around you."

Bocconi historian Berta thinks the family's continued financial presence is important for Fiat's stability, but that the professional managers should run the shop. Another Gianni Agnelli, he says, would be impossible today. "Elkann must fulfill the role of chief stockholder. That means being less of a presence in the operation of the company than his grandfather." Berta said. "Back then Fiat acted like an institution in Italy. Fiat has to behave like a normal company."

That's harder than it sounds. Gone are the days when nationalism and protectionism meant that as many of 85% of cars sold in Italy were Fiats. Now the company needs a genuinely global approach, which probably includes pursuing one-off, local alliances to build specific products, much like a November deal inked with Ford to jointly turn out new compact cars in Poland. The company, which is particularly strong in Brazil, has been looking for expansion possibilities in India and China. Elkann may be especially suited for these global challenges, having lived all around the world as a youth. "Moving around, you adapt quickly to environments," he says. "If you are competent in many things, you don't have the depth of knowledge in any one field. I'm more long than deep. But fortunately for me, the family's interests were already diversified by both business and geography."

Along with sports and the family business, another passion Elkann shares with his grandfather is art. The creative dna has multiplied through his author father and painter mother. "Artists have a sensibility that others don't have," he says. "They have a way of reading into the future." And so, in their own way, do business leaders — they just tend to have less time.

• JEFF ISRAELY/Turin
• The heir to the Fiat empire lifts the lid on his rapid rise