By on August 23, 2010

Automobilwoche [sub] picked up strong signals that Volkswagen is interested in adding Alfa Romeo to their growing roster of brands. Last December, Marchionne had put Alfa on strategic review, and gave the brand, as Ed Niedermeyer put it so delicately, “a year to get its proverbial shit together.” They popped some Imodium, and  in April, Marchionne was “determined” to build the brand into a “full-line premium carmaker.” Nevertheless, here and there whispers had popped up that Alfa could be sold if the right buyer would show.

That buyer could be in Wolfsburg. A high ranking, albeit nameless Volkswagen executive told Automobilwoche that “Alfa is a globally renowned brand with sportive DNA and a long tradition. If such a treasure would become available, we should not hesitate for too long.”

In Wolfsburg, the project already is nicknamed “Italian dressing.”

A Volkswagen spokesperson added to the fire by saying: “We don’t comment on speculations about Alfa.”

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27 Comments on “Italian Dressing: Volkswagen To Buy Alfa?...”


  • avatar
    Ingvar

    The last ten years, they’ve sold for between 150 000 – 200 000 units per year. Which is not nearly enough to make one model on one product line profitable. On the other hand, they are the Fiat empires mass market halo brand, with a substantial brand cachet. Like Jeep, the Alfa brand is a potential hidden asset. BMW could successfully resurrect the Mini brand, and the other car makers took notice. So, the question is, is that hidden asset profitable enough for Alfa to keep, or simply sell and profit from?

  • avatar
    Tstag

    People don’t buy Alfa’s because they think about reliability and lack of RWD options….

    People buy VW’s in Europe at least because of reliability and build quality. Put this together with a RWD platform and bingo you have some success.

    But I don’t really see why VW wants this brand. Surely they have enough brands at present.

  • avatar
    Abraxas

    If VW Group will buy Alfa Romeo, very soon they will purchase a controlling stake in Mazda ( Ford will sell its 11 % stake in Mazda very soon ). The RWD Mazda platforms could be used for next generations Alfa Romeo models ( Spider, new 159 ) .

  • avatar
    Abraxas

    They will use only the platform of next Mazda RX8, Giugiaro will design a stylish sedan, a coupe and a cabrio to compete with BMW 3 series . Alfa Romeo Spider could be build based on next Mazda MX5 .

  • avatar
    Abraxas

    Anheuser-Busch InBev, the largest global brewer with nearly 25% global market share has a portfolio of nearly 300 brands worldwide . In the near future, auto industry will resemble very much with beer industry .

    • 0 avatar
      moedaman

      If you’re a homebrewing, beer fan like me. You’ll see that most of those brands are regional products that only compete with other regional brands. You can make money selling beer that way. But you can’t make money selling cars that way. Autos need economies of scale and those regional brands need to sell outside a region to be profitable. Look no further than GM or British Leyland on having brands whose main competition are other brands you own. Hell, VW is having a hard time making money on its Spanish brand because of internal competion.

      Where exactly would VW place Alfa anyway? Would they move Audi up? Audi’s are already overpriced. Would they put it between Audi and it’s luxury brands? There is a gap there, but how many could VW sell? Would it only produce sports cars? Again, not a good way to sell a lot of vehicles.

      The best thing for Alfa is for Fiat to keep it and sell it in North America again to find more sales, or get rid of Lancia.

  • avatar
    Abraxas

    Alfa Romeo will compete against BMW and Audi will be a Mercedes competitor . VW Group can manage very well all the brands they have . After Alfa Romeo and Mazda, I also think they will buy IVECO ( after FIAT spin-off ) to integrate with MAN, Scania and VW commercial division . In 2011, VW Group could look like this : VW, Bugatti, Bentley, Lamborghini, Porsche, Audi, Alfa Romeo, Suzuki, Mazda, Skoda, SEAT, VW Commercial Division ( VW, MAN, Scania, IVECO ) .

  • avatar
    AnthonyG

    If VW purchased bought Alfa what would they do with Seat, who’s ‘brand’ is basically an ‘wannabe’ Alfa Romeo.

    There is no way Alfa could compete with BMW, maybe some specific models like the 1 & 3 series & z4, but not the whole range.

  • avatar
    Educator(of teachers)Dan

    This feels like a WAROTD. Wild-a$$-rumor-of-the-day.

  • avatar
    psarhjinian

    Oh, yes, because what VW needs in it’s quest to make every mistake GM ever made is a complete duplicate of one of it’s profitable premium brands. Alfa could be VW’s Buick. Or Cadillac. Or Olds. Or Saab. Or possibly Pontiac.

    • 0 avatar
      dadude53

      Not quite. Seat would be replaced by Alfa.

    • 0 avatar
      NulloModo

      Apparently TTAC decided to eat my comment…

      This seems to me like VAG’s current lineup –

      Skoda – Value
      VW – Mainstream
      Audi – Luxury/Performance
      Porsche – Premium Luxury/Performance
      Bentley – Ultra Premium Luxury
      Lambo – Ultra Premium Performance
      Bugatti – The ultimate evolution of all things automotive

      Where does Seat fit in right now? Are they pegged as a performance brand, or as a luxury on the cheap brand? Is it VW’s answer to Pontiac and/or Mazda? For any Europeans out there – what do you and your countrymen feel about Seat?

      It seems to me like VW is already heavily weighted towards luxury brands, and with VW’s offerings pushing upmarket at the same time that Porsche was suddenly added to the lineup, things are getting even more complicated. Alfa seems like it would be a natural equivalent to Audi, but where would that leave Audi, which is already getting squeezed from the top and the bottom?

  • avatar
    Jan Andersson

    All they need is a place front center for a licence plate. The off-center plates have always made me shiver. Not a golden ring in a pig’s snout, but quite the opposite.

  • avatar
    carguy

    Maybe they are just looking for an even less reliable brand to make the rest of VW feel better about themselves?

  • avatar
    John Horner

    Once upon a time, GM did a magnificent job managing a host of brands. VW today does a pretty good job managing a bunch of brands.

    Management think, especially in the US, tends to go in fads. Today’s fad is “Focus”. Tomorrow’s fade might once again be “Diversification”.

    “Everyone knows” that a good company wants a small stable of brands to manage. The problem with things “everyone knows” is that such knowledge is often either wrong, useless, or both.

    • 0 avatar
      psarhjinian

      GM did a good job managing a host of brands back when it had fifty percent of it’s domestic market. The brand structure allowed them sell at the scale and fostered a useful internal competitiveness that drove innovation. The same structure became a liability when they shrank and competition fell by the wayside, replaced by cost problems.

      It’s not so much “everybody knows” as “right tool for the job”. Multiple brands are great when you’re GM circa 1950, or Whirlpool today. It works reasonably well for VW when we’re talking luxury brands like Porsche, Bentley, Bugatti and Lamborghini. It’s not so great when you hold, at best, 20% of the market and you’re already suffering cannibalization as VW is with SEAT, Skoda and the VW brand itself.

  • avatar
    Lorenzo

    Before Sergio sells Alfa, he has to decide on who gets the Chrysler RWD platform, besides or instead of Chrysler. There was speculation that Lancia would go upscale with the large RWD platform, eliminating the Chrysler nameplate but it’s Mercedes-derived and might work better as a fullsized luxury Alfa. Would a luxury Alfa (maybe with a hemi) sell? Would larger Lancias become somewhat-upscale Chryslers in NA, with Alfa the halo brand, and Lancia limited to Euroland? Sergio, you got some deciding to do.

  • avatar
    MGV001

    Marchionne is a bean counter. He knows he can get more out of Alfa by selling it than investing in it. He knows he doesn’t have – and will never have – the resources to properly resurect Alfa Romeo. Selling Alfa Romeo is the right thing to do for Fiat and for Alfa.

  • avatar
    LDMAN1

    Luca de Meo, Alfa Romeo’s ex-CEO is already working for VW. If anyone can turn around this Brand, he can do it.

    • 0 avatar
      CRConrad

      Why do you think so?

      I mean, if he’s the ex-CEO, then he’s already had a chance to “turn around this Brand”.

      And since you apparently think there is a need to “turn around this Brand”, it seems he didn’t do so when he had the chance.

      So why do you think he’d be the man to do it, when he didn’t do it already back when he was the CEO?

  • avatar
    Abraxas

    Luca Ciferri : Fiat should sell Alfa to Volkswagen ( http://europe.autonews.com/article/20100824/BLOG12/308249985/1303 ) .

  • avatar
    Stingray

    This would be very painful to see.

    But the demise of Alfa would be even more painful.

    The argument for the purchase is dead on.


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