Longtime Fiat Chrysler Automobiles (FCAU) Chief Sergio Marchionne remains "gravely ill," in a Swiss hospital, according to Italian media reports, after the company appointed new leaders to head Fiat Chrysler and Ferrari N.V. (RACE) .

Over the weekend Marchionne stepped down following a shoulder surgery complication after 14 years as CEO. Il Messaggero, a Rome newspaper, reported Sunday that "complications arose which compromised the situation, which worsened in recent hours," according to a Google translation of a story on the newspaper's website.

Fiat shares declined 1.6% in Monday trading to $18.91.

A sudden leadership transition is bound to cause a bumpy ride for Fiat Chrysler, says Richard J. Hilgert a senior equity analyst for automotive at Morningstar Inc., but won't undercut the company's value.

The market "is going to react negatively and people will sell off shares," Hilgert said. "If an executive of this caliber is suddenly out of the picture it does have an effect, but any selloff I view as a buying opportunity."

Despite the "key man risk," Hilgert said, his replacement Michael Manley, the current head of Jeep, should be able to execute the company's existing plan to sell more SUVs and boost sales of high-end brands around the globe.

Marchionne, 66, is a well-known workaholic and was a heavy smoker until about a year ago, when sources say he quit. He was set to retire from Fiat Chrysler in 2019.

Marchionne was widely credited for stewarding a rebound in Fiat's fortunes. 

Hilgert set a fair estimated value of the stock of $25 based on his analysis that assumed lower-than-projected cash flow through 2022.

Louis C. Camilleri, the former CEO of Philip Morris & Co. Tobacco was appointed to replace Marchionne as CEO of Ferrari.

The high-level management reshuffling continued through Monday, when Fiat Chrysler's European Chief Alfredo Altavilla, stepped down as well to "pursue other professional interests," according to the company statement on Monday. 

Analysts for Morgan Stanley rated Fiat Chrysler stock overweight with a price target of $23, writing that they held Manley in high regard, but some volatility should be expected until the newly installed management shares more of their plans and direction.

"It is impossible to overstate how deeply Sergio Marchionne engaged in all key aspects of strategy and operations of the business," equity analyst Adam Jonas wrote Monday. "Whenever the investment community pressed the topic of succession and 'key man risk' to Sergio he always referred to the deep bench of talented leaders he had groomed over the years. Investors must decide if the next generation can carry on the legacy."

Fiat Chrysler Looked Bearish Even Before the Marchionne News

Fiat Chrysler Faces Deep Existential Crisis: Now's the Right Time to Sell Jeep

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