Jeep division head Manley was named on Saturday to succeed Chief Executive Sergio Marchionne, one of the auto industry's most tenacious and respected leaders, who fell seriously ill after suffering complications following surgery.
It emerged on Monday that Alfredo Altavilla, head of Fiat Chrysler's business in the Europe, Middle East Africa had resigned, according to a source with knowledge of the matter. He had been a rival for the top job along with Manley and Chief Financial Officer Richard Palmer.
Marchionne had been due to step down next April as head of the world's seventh largest carmaker, so the market reaction to his sudden departure was relatively limited. The shares initially fell more than 5 percent, but then pared some losses and were down 2.7 percent by 1235 GMT.
"The downside may be modest, at least in the next 12 months. But long-term concerns will build Marchionne ran FCA in a command and control style, with constant firefighting measures," said Bernstein analyst Max Warburton.
Fiat Chrysler Automobiles (FCA) said British-born Manley would pursue the strategy that Marchionne outlined last month.
FCA has pledged to increase production of sport utility vehicles and invest in electric and hybrid cars to double operating profit by 2022. It also unveiled bold targets for Jeep, which has become FCA's ticket to creating a high-margin brand with global appeal.