(Writes through, adds reaction)
By Gianni Montani
TURIN, May 28 (Reuters) - Born into a family whose glamour and success earned them the title of Italy's uncrowned royals,Chairman Umberto Agnelli was a prince in waiting, standing in the shadow of his more charismatic elder brother, Gianni.
His death from cancer late on Thursday was the latest blow to a family which -- like the Kennedys in the United States -- has seen its apparent good fortune tempered by tragedy.
His father Edoardo was killed in a plane crash in 1935 and his mother in a car accident some years later. His son, widely tipped to be the heir to thethrone, died in 1997 from stomach cancer and his nephew committed suicide by leaping from a bridge in 2000.
Just last year much-loved family patriarch Gianni -- king of Italian industry and an icon of the "dolce vita" -- succumbed to cancer at the age of 81.
"The destiny of the Agnelli family is tragic," said Georges Douin, executive vice president at carmakerin France. "It is reminiscent of the Kennedys."
For years the chairman of soccer club Juventus and head of other firms in the family empire, Umberto was thrust into the limelight after his brother Gianni's death, taking over at the wheel of the carmaker his grandfather founded 105 years ago.
He faced the daunting task of turning around the company's struggling fortunes. The Fiat group -- which owns Ferrari, Maserati and Alfa Romeo -- was in its deepest crisis.
In 2002, it made a record net loss of 4.3 billion euros and had to sack thousands of workers to get costs under control, while pumping up investment in new cars to reverse a sales slump at its carmaking unit.
Under pressure from his bankers, Umberto brought in an outsider as chief executive, Giuseppe Morchio.
A one-time senator for the Christian Democratic party, the silver-haired Umberto did not have the flamboyance of Gianni, a World War Two tank commander and former racing car driver who in his latter years was often pictured at the helm of his sleek black racing yacht "Stealth".
Compared with his brother, who had a deep affection for the Fiat cars that came to symbolise Italy's postwar boom, the younger law graduate was a numbers man.
Born in 1934 in Lausanne, Umberto was one of seven children born to Virginia Bourbon del Monte, princess of San Faustino. His sister, Susanna, was foreign minister in the 1990s, and the younger Agnellis are stalwarts of Europe's society magazine clique.
Umberto is survived by his second wife, Allegra Caracciolo, with whom he had two children, Andrea and Anna.
The family's business hopes are now pinned on Gianni's grandsons John and Lapo, the next generation in a family viewed as the closest Italy had to royalty while the Savoys lived in exile after the end of World War Two.
Umberto was best known to soccer fans as honorary chairman of Turin soccer club Juventus where he first took charge at the age of just 22, in 1956.
Fiat group CEO for 10 years in the 1970s and CEO of its Fiat Auto division throughout the 1980s, Umberto was ousted from both posts as Fiat lurched from one crisis to another.
He was denied the Fiat chairmanship twice by Gianni who was instead grooming Umberto's son, Giovannino, for the top job before the heir-apparent died in 1997.
During the crisis, Umberto had been chairman of the Agnelli family holding company Ifil and had made no secret of his willingness to see Fiat sell its loss-making car arm and focus on more profitable service-based sectors as Ifil had done.
But once in the driving seat of the group whose products range from tractors to robots, he pledged allegiance to the auto division, brushing off talk of exercising an option to sell it to U.S. giant, which now owns a 10 percent stake.
A quieter, more down-to-earth man than his brother, Umberto stamped his authority on Fiat, bringing in no-nonsense CEO Morchio for an overhaul and allowing an army of outside managers to take over a company dominated by long-term Fiat employees.
He took on tough fights, and played hardball with GM, which argues the action Fiat took to re-boot Fiat Auto has annulled the put option. The two carmakers have delayed the option until January 2005 to work out their feud.