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Within days of the death in late May of Umberto Agnelli, the patriarch of one of Italy's leading business families, Giuseppe Morchio made his move. As mourners continued to pay their last respects, the chief executive of the Fiat auto and truck company that is the core of the Agnelli family fortune demanded to be given Umberto's title of chairman as well.

To the family, it seemed like a blatant power grab, and when its members replied, "No, grazie," he quit in a huff. The top job went instead to Luca Cordero di Montezemolo, the head of Ferrari and a family intimate for three decades. Two young Agnelli cousins were elevated too. John Elkann, 28, was appointed Fiat deputy chairman, and his cousin Andrea Agnelli, also 28, joined the board. Another long-standing Agnelli manager was quickly named CEO. "The family moved very fast," says a person close to the Agnellis. "Morchio was a bit Napoleonic. The new men are more into team building."

It all marks a rite of passage, with the longer-term fate and fortune of the fabled Italian family, worth some $2 billion, now resting on the shoulders of three members of the next generation. Elkann and his younger brother Lapo are grandsons of Giovanni Agnelli, and Andrea is Umberto's son by his second marriage. The family's line of succession was disrupted when Umberto's eldest son, long seen as the heir apparent, died of cancer in 1997--and Giovanni's son committed suicide in 2000. The three cousins have limited business experience.

Elkann has been telling friends that he will learn on the job from Montezemolo. The succession shuffle comes at a difficult time at Fiat, which has lost $7.5 billion in the past two years. The Agnellis control diverse assets, but the prize — and the site of the problems — is Fiat, 30% of which the family owns. Morchio had put in place a tough turnaround plan designed to rescue the automaker. The fourth CEO in two years, Morchio was negotiating with General Motors over an option to sell Fiat to GM that was signed in 2000.

Elkann, known as Jaki, was singled out as a possible successor by his grandfather, who put him on Fiat's board in 1997. So far he has deliberately kept out of the spotlight. Lapo, 27, who works in Fiat's marketing department, frequently appears in the gossip columns, not least because he's dating a TV starlet. Andrea currently works for Philip Morris. Family members say all three will play leadership roles. The question is, How successfully can the Agnellis manage the troubled empire while the youngsters are learning the ropes?

• Peter Gumbel