By on April 3, 2013

VW and Fiat are in talks regarding a possible sale of Alfa Romeo. The sale of Alfa Romeo to Audi would also include the Pomilgiano assembly plant in Naples, which once made Alfas, but currently produces the Fiat Panda. Magnetti Marelli, Fiat’s famed parts maker, may also be included in the deal, as Fiat looks to raise cash so it can buy the remaining shares of Chrysler off the UAW’s Voluntary Employee Benefits Association.

Meanwhile, Audi has already established a presence in Italy with both Lamborghini, Ducati and Italdesign. Adding Alfa Romeo and an Italian plant would only entrench its standing, and the sale of an assembly plant would be mutually beneficial for both VW and Fiat, as Alfa could retain its “Made in Italy” heritage while Fiat looks like a hero by ensuring that the plant and its workers have some security. Of course, nobody knows what VW would even do with Alfa, considering its sales picture is even bleaker than VW’s ailing SEAT brand.

Get the latest TTAC e-Newsletter!

91 Comments on “Volkswagen, Fiat Discussing Alfa Romeo Sale...”


  • avatar
    Vega

    Yes, but in contrast to Seat Alfa has a clear brand heritage that was criminally mismanaged by Fiat for decades. Back in the 70s BMW and Alfa were direct competitors both in terms of target market and size (BMW 1500-2000 vs. Alfa Giulia).
    If Volkswagen can manage this heritage skillfully, there is a good opportunity to capture classic BMW clients who favor an aspirational brand with a sporty image, something Audi so far has not completely managed.

    • 0 avatar
      hreardon

      The question is whether VW can demonstrate a viable market position for Alfa to occupy, build and sell them profitably and with that conquer sales from other brands.

      They very well may be able to turn Alfa into an emotional alternative to both Audi and BMW: a less techno-wizard product, a ‘simpler’ sports brand as compared to the Vorsprung Durch Technik.

  • avatar
    PrincipalDan

    What’s it all about Alfa…

    Kinda seems like a purchase for the sake of a purchase on VW part. What the heck would they need Alfa for? VW is becoming like the old GM just for the sheer proliferation of brands.

    • 0 avatar
      Lorenzo

      What the heck would they need Alfa for? Because Herr Piech wants it, and what Herr Piech wants, Herr Piech gets. The Best Minds at VAG will figure out how to make it work, if they know what’s good for them.

  • avatar
    EquipmentJunkie

    Wasn’t this Alfa topic the subject of a lot of catty comments between Piech and Marchionne a number of months ago?

  • avatar
    Robbie

    Volkswagen seems to overextend itself dangerously… How many cars can one possibly build on one platform? Shouldn’t they instead focus on making Passat, Golf and Polo be lightyears ahead of the competition?

  • avatar
    cargogh

    I’ve had 5 Chrysler products and one Fiat over the years, so there was some initial excitement about Alfa coming back to the US. But looking back at how many I’ve seen, it was a rarity. An occasional Spider, GT-V6, the odd Milano–I’ve never even known an actual owner. The coupes and sedans were gorgeous, but already old.
    I wish Alfa the best, and hope the marque is around for years to come. My bigger to desire is to see Chrysler/Fiat succeed. That seems faster and more likely without taking on anything else that is struggling. It is easier to win at Monopoly when opponents are buying houses/hotels with GO money every round.
    Audi, like BMW, could use something a vehicle that is less soft, comfortable and computer controlled. Alfa is like a kid being adopted. You want it to go to a home that has the most to offer.

    • 0 avatar
      Tosh

      I’m going to throw your Monopoly analogy (Monopology) back in your face: One wins at Monopoly by buying ALL the real estate possible, and then selling it on later to some poor sap who just has to have it to complete their ‘suite.’ And this is what VW sees by buying Alfa.

      • 0 avatar
        cargogh

        I’m sure you’re correct, but I do remember losing a few games by landing on the winner’s Boardwalk and Park Place hotels. They had few properties, but with me, and others, landing on their prime ones it was good enough for them to win. What I can’t remember is which properties VW has bought and resold.

    • 0 avatar
      blowfish

      Perhaps Sergio just didnt want to fight the battle in too many fronts but concentrate on FIAT and Cryslurs.
      Alfa is not what it used to be in the days of the movie “graduates” anymore.
      Sergio has enuf presence in N America anyways.
      Just concentrate on the quality and not quantity.

  • avatar
    28-Cars-Later

    Volkswagen is a juggernaut, it must be stopped.

  • avatar
    bobman

    When I first saw this news item last Thursday, I thought it must have been an April Fool’s prank. The Pomilgiano inclusion didn’t make any sense considering it had just been converted to making Pandas and will cost a lot of money to convert it to something that will produce an Audi version of an Alfa Romeo. (I suppose Polish Panda production could be restarted.)

    Also, Magnetti Marelli? Its main customer is Fiat. How would that work? I don’t see this working to anyone’s benefit. It would not net Sergio what he needs for the remaining Chrysler shares.

    Don’t do it Sergio. Go with the original plan, Chrysler will still be there later when things settle down in Europe.

    • 0 avatar
      juicy sushi

      Could Polish production of the Panda be a goal Sergio had though? He’s been vocally critical of Italian labour, and it might be cheaper in his mind to take the hit re-equiping a Polish plant to do the Panda than it is to keep paying Italian workers to build them less productively. It also helps reduce over-capacity.

      • 0 avatar

        Tychy is one of their best plants, so perhaps.

      • 0 avatar
        bobman

        It could be that that’s what he has in mind. There was another news item kicking around a couple of weeks back about moving the 500 production out of Mexico to Poland. The purpose of that was to free up some capacity here in NA to accommodate local demand.
        WTF Sergio, take a chill pill. Too many things on the go at once.

        - China, Russia and India – Fiat and Jeep ramp-ups.
        - Terrible home market in Italy – big economic and political problems.
        - VEBA is looking to maximize their interests in Chrysler.

        Can’t fix it all at once. Don’t get desperate and give everything away.

    • 0 avatar
      th009

      Cassino plant makes more sense, as it builds the Giulia today and precious little else. It’s woefully underutilized and Marchionne has already tried (unsuccessfully) to shut it down. Selling it to VW would rid Fiat of some overcapacity.

      • 0 avatar
        Lorenzo

        So Sergio throws in the Cassino plant too, and makes a major cut in troublesome, inefficient Italian assembly capacity. That and the cash to buy out the VEBA would be enough for Sergio to change his mind about Alfa, or John Elkann’s mind. Others may forget, but Sergio likely doesn’t, that Elkann is the chosen Agnelli heir who represents the family. Marchione after all is just an employee.

  • avatar
    thegamper

    Bummer, I was looking forward to the return of Alfa Romeo to the US as part of a Fiat/Chrysler turnaround story. I suppose in the end, it makes financial sense to sell Alfa, sort of like the one Ford strategy. Cut off the diseased limbs and focus on what you have left. Alfa has aging models, anemic sales, etc, and would take a substantial investment to turn it around. Of course one could argue that Fiat itself is becoming diseased with its core Euro operations tanking. In any event, I do hope Alfa will be around for a long time to come. And like the earlier posts, I question the wisdom of VW buying more brands.

    • 0 avatar
      hreardon

      There may be many reasons for the buy:

      1. VW wants it so nobody else can have it;
      2. VW wants to pull as many sales from its competition as possible (to quote Steve Jobs: better to cannibalize our own product lines than a competitor do so);
      3. VW needs the additional factory capacity;
      4. Alfa may have certain technologies/patents that are appealing;
      5. There may be a tax advantage to the purchase;
      6. Germany is planning to go all Cyprus and Greece on Italy and planting stakes in the ground to help recoup some of the inevitable losses;
      7. Ferdinand Piech really, really, really likes Alfas.

      I joke slightly, but any combination of these may be reason enough for the buy. If VW can carve out a unique identity for Alfa, they’ll be fine. Nobody said that would be easy.

      • 0 avatar
        Lorenzo

        Actually, #7 alone is all that’s necessary, but thegamper raises a point: all those Fiat dealers shelled out big bucks expecting to sell Alfas more than Fiats. They’re going to be PO’ed, unless they get some upscale cars to sell. New Chrysler models may not get it done (assuming they HAVE new Chrysler models in development).

      • 0 avatar
        CV Neuves

        1.) VW is desperate to become the world’s #1 automaker
        2.) VW finished last reporting season with a record profit
        3.) Alfa-Romeo might be cheap enough
        4.) VW might hope to transform AR to a better kind of Honda, Volvo or it might go the way of Rover or Saab in the niche semi-upmarket segment under Jaguar.

  • avatar
    gslippy

    Bad idea.

    I can’t imagine the corporate cultures of VW and Alfa blending well – sort of like Daimler and Chrysler. As an aside, I think the cultures of Chrysler and Fiat are a marriage made in heaven.

  • avatar
    jimboy

    C’mon everybody! This is a perennial story that makes the rounds regularly. Happy April Fools!

  • avatar

    I wonder if VW is looking at the Ferrari-Maserati pairup and pondering a similar Lamborghini-Alfa pairing. I don’t know if they could successfully take Alfa in that direction, but then again, after the BiTurbos, who would have guessed that Maserati could be made respectable again?

  • avatar
    Type57SC

    I expect the Magnetti Marelli sale. It makes sense given FIAT’s need to buy Chrysler vs have it go public. Alfa makes no sense. It’s not going to pull in enough to help the cash available considerably, so why bother?

  • avatar
    CoreyDL

    VW, you don’t need more Italian brands, just a couple more Italian styling people ;) they’re cheaper anyway.

  • avatar
    juicy sushi

    Whither the ND Mazda MX-5 now? Would VW continue the collaboration? Or would it try to have some okonmiyaki to go along with their bruschetta?

  • avatar
    b787

    I hope the sale doesn’t happen – who wants another Golf clone with different styling? On a more positive note, Audi managed Lamborghini fairly well, additionally they also own Italdesign, so I predict VW-Alfas to be quite beautiful.

    Still, maintaining so many brands must be very expensive, but can be done if your financial position is as good as Volkswagen’s. However, things won’t always be as rosy, eventually they will be forced to sell off most of the brands they accumulated over the years.

    • 0 avatar
      th009

      Currently Alfa has a Panda clone with different styling and a Bravo clone with different styling. And they are working on a Dart clone with different styling. See the pattern?

      Let’s face it, the real Alfa Romeo disappeared in 1986. All that’s left now is the name.

  • avatar
    Lampredi

    Couldn’t Ferdinand Piëch find better use for his time in his final years than to give Alfisti heart palpitations?!

    If by any chance Marchionne *has* decided to play Judas with Alfa Romeo, I’d say he certainly picked the right season…

  • avatar
    Vaggo

    I dont think this would happen. But if it does I think the scenario posted here and on other sites is slightly off.

    The Pomilgiano assembly plant will be kept by fiat. They just spent a buttload tooling it up and VW wont want it that way as they won’t re-use fiat equipment (Fiat make their own factory robots etc in another part of the industrial empire)

    I think if it happens they will get the Brand, the old history alfa Arese factory (shut down a long while ago) and adjoining design centre (only closed last year) and alfa’s heritage museum (Still on-site). They will all be in NORTHERN ITALY. Which is significant as this is where all of VW’s italian holdings are, not to mention Magnetti Marelli HQ.

    This also solves the problem of the 5-6 magnetti marelli factories located near fiats (now also closed) Rivalta plant which is near the Arese plant. These factories were to provide JIT service to the massive northern plants that are all closed…and now are very inconveniently located.

    VW will like the idea of a clean slate at Arese due to their favouring “clearing house” of old staff and processes.

    They would likely have the Mito and Giulietta continue in their current form under contract from Fiat, as well as possibly the Alfa 4C.

    In their next Generation I think VW’s plan would be an Alfa based on the Boxster as a halo model, reskinned MQB platform replacements for the Mito and Giulietta, and maybe a giulia/159 based on the next gen passat cc. Even if they dont sell in huge numbers VW will likely make money as they’d use a platform shared with 1million+ models per year.

    The big question for me is WHAT would VW do with the Arese Plant. The way I see it, most of the new models would initially be built at other MQB plants and Porsche (or Onnanusbruck) for the boxster-based model at least initially. Now VW could potentially run out of MQB-platform capacity in its EU plants and Arese could be rebuilt to build MQB alfas and overflow of other brands (like SEAT martorell already does in spain for the old Golf platform & builds audis etc).

    Another scenario is that it could be mostly demolished and handle only management, development(maybe), styling and possibly small-scale assembly of a halo model. VW’s other halo models (Bentley etc) have all their bodies made in a central location in DE and shipped out for assembly, something similar could be done here with an E-segment saloon/4-door coupe that could share a new platform with future Audi A7/8, porsche Panamera & Bentley Continental.

    Another potential interesting development is that Porsche have been working on a 4-cyl boxer engine…something that is part of Alfa’s heritage. if this could be made to fit in MQB or an Alfa “boxster” etc then this would be VERY intrigueing.

    Still, Marchionne is a very proud man and i think the whole thing is rather unlikely…just my 2 cents

    • 0 avatar
      Vaggo

      As an aside, I reckon Marchionne should try and package lancia with Magnetti Marelli. The Germans will never go for it. But it’d tickle me to get some Audi-based lancias that actually ride well (unlike rock-like suspensioned audis) and have interiors and exteriors where the designers are allowed to be more flamboyant and not repeat identical styling in varying sizes.

      wont happen, but i can always dream haha.

      • 0 avatar
        CoreyDL

        Lancia hasn’t been flamboyant/profitable since the late 90s, as they’re currently just slightly altered Chryslers.

      • 0 avatar
        Morea

        Vaggo, in your opinion is the 4C a genuine attempt by Marchionne to revive Alfa Romeo? To me it seems the 4C, like the 8C before it, is an attempt to keep some value in the Alfa brand name without having to invest in a full line of cars. Marchionne’s strategy for Alfa is unclear to most Alfisti.

  • avatar
    jellybone

    Who knows what the truth behind all this is, Sergio dislikes VW very much and VW wants Alfa very much, so who knows what is happening behind the scenes. I think industry talk is that VW is dropping “leaks” about a possible sale when nothing is truly on the table, pressure tactics… although I don’t see how those leeks put pressure on Sergio, being Italian if anything he’d be even more resistant..
    At the same time I guess if they need money to buy more of Chrysler then who knows, maybe there is something to it, but I would think they’d sell Magnetti before Alfa, does anybody know the valuation of that sale, would it cover their needs?
    The interesting thing is that VW has for years had a business plan in place for Alfa, even cars all drawn up, etc.. Even if there was no sale I’d love to see what their intent was, not that they’d release it..
    For the consumer though it would be perfect, German engineered Alfa’s with the money behind it to properly launch a whole new assortment of vehicles, sedans, suv’s, sports cars.. and not take 20 years to do it, with continous delays..
    Why would VW want Alfa, hmmm who wouldn’t… it’s a potential gold mine, with the right product and reach I’d say it could steal lots of BMW, Benz, Jag, Caddy, Lexus, Infiniti, sales, of course some Audi sales too but better they take their own sales than Fiat does, and Alfa could be a premium brand with very good margins…
    Italian flair, VAG resources… very interesting indeed..

    • 0 avatar
      jellybone

      i might add, IMHO Sergio doesn’t need Alfa, Maserati can be made to go after BMW, Audi and Benz… Just look how good Jag/LR have been turned around…

  • avatar
    wmba

    Alfa would just be pocket change for Ferdy, and allow him to swan around in Cortina d’Ampezzo flaunting his swarthy Teutonic charms at the most amazing looking babes it’s ever been my pleasure to observe. He needs another concubine or two.

    But back to business. VW has observed that Toyota is about to make a line of RWD cars based on the GT86 (Scion FR-S), and to make sure they have a seat at that table, Alfa would allow them to introduce a RWD line to compete. At present, the only front-engine RWD cars VW make are the bigger Bentleys, the remainder being tin or aluminum cans featuring FWD or AWD and Porsches with mid or rear engines, spotty reliability and doubtful parts.

    It’s a heaven-sent opportunity for the marketing geniuses at VW HQ. Add a bit of German-inspired Italianate styling, and the Giulia 2000 GT Veloce can ride again! With a standard VW turbo 2 litre, and ads trumpeting the proud and glorious history of a marque that sometimes beat the Auto-Unions in pre-war Grand Prix. Such satisfying irony for the new owners.

    It all makes sense to me, but a spot of Laphroaig will do that.

  • avatar
    MeaCulpa

    If VAG buys alfa and then kills SEAT I’ll be a happy camper. If they build Alfas as “Fun” versions of audis with the kind of cheap interiors and fantastic styling that Italians excel at I’ll be over the moon.

    On a side note, I was overtaken the other day by a LANCIA Voyager, that was a truly horrific event.

  • avatar

    as a Lancia fan, I’d love to see the Fiat Group offloading Alfa Romeo and focusing on Lancia as its luxury, non-halo brand.

    • 0 avatar
      MeaCulpa

      Good luck with that one. Lancia has zero brand credibility left and can probably be bought for loose change found in GMs Flint cafeteria. Rebadged chryslers and and lackluster fiats for twenty years before that will do that to any brand. The old Kapa coupe was nice looking in a generic way though.

    • 0 avatar
      Lorenzo

      The dealers, palandi, the DEALERS! They were saddled with Fiat showrooms because they expected Alfas. Give them Lancias and there will be some very unhappy campers.

  • avatar
    LDMAN1

    Alfa Romeo would have a fighting chance with VW/AUDI. Sergio’s not interested and needs the cash. I am not sure that John ever wanted Fiat Group Automobiles as a whole as it was always too much of a headache since the Avocatto and Giovanni passed away. Over the last ten year’s the Brand lost 50% of its volume and 80% of their sales are now comprised Mito. Who know how much of that is no/low margin rent a car and chilometri zero units. Now that Audi owns 2 Italian Brands (Lamborghini and Ducati) it would makes sense to add Alfa Romeo to the mix. Italian style and German engineering.

  • avatar
    pennellotref

    E’ una CAZZATA !!!!!!!!!!!!!!!

  • avatar
    GTAm

    I certainly hope that Fiat never sells Alfa. The Italian-ness will be lost. Under VW an Alfa Romeo will be a pizz from Pizza hut. Not the authentic thing. Look at what they’ve done with Bentley. The British charm is gone. The new Bentleys even look like bloated VWs. Lambos are way behind Ferrari in every positive way bar ability to grab attention. Giugiaro was one of the greatest if not THE greatest. But his “use by” date is gone judging buy the show cars that were shown on the VW stands in the recently past. Made me yawn.

    No doubt Alfa has been mis-managed by Fiat all these years. But here they are right now on the cusp of a proper re-launch. With the way they have managed Chrysler and the way that they are transforming Maserati shows that they know what needs to be done.
    I would rather drive a Fiat based Alfa than a VW based Alfa.I sincerely hope this is an April Fools joke.

    • 0 avatar
      th009

      In 1998, when VW bought Lamborghini, the company was struggling with a single model, 200 sales per year (1/20th of Ferrari) and losing money. Today they have two models, 2000 sales per year (1/4 of Ferrari) and profitable. Lamborghini leverages Audi engineering but design, manufacturing and museum continue to be in Italy, and the company continues to support racing programs.

      In 1986, when Fiat bought Alfa Romeo, the company was selling eight different car models (plus a van!) and the company was selling some some 200K cars per year. Today the company is selling two, and at the rate of 60K per year — and Fiat has shut down both the museum and the racing programs.

      So VW has destroyed Lamborghini, have they, while Fiat is demonstrating the Italian passion about cars?

      • 0 avatar
        MeaCulpa

        Racing a Lamborghini? Talk about pis*ing all over a brands heritage.

      • 0 avatar
        bobman

        @th009
        Geez, you make it sound as if Alfa was rolling in money by selling cars like hotcakes. They weren’t. To say that Fiat bought Alfa is also a stretch. More like the Italian government begged them to take it. In one of his news conferences, Sergio wondered if Alfa ever made money. He also acknowledged that Fiat had bastardized the brand by using Fiat platforms.

        I think that’s what GTAm was referring to; that there seemed to be a recognition of that neglect and a willingness to make it right. With Audi in control, it would just be another brand in the VW treasure chest for them to play with. The Alfa soul would be lost.

        • 0 avatar
          Lampredi

          +1

        • 0 avatar
          th009

          Fiat shut down Alfa’s racing program and cut down the model lineup long before the current economic crisis. And shutting down the museum surely didn’t save much money.

          There has been much talk about making things right for Alfa. But at some point you need to walk the walk. So far it’s two rebadged Fiats on the market, a plan to rebadge a Dodge, and another plan to rebadge a Mazda. I’m sorry, but I have trouble spotting the Alfa Romeo soul in that plan.

          • 0 avatar
            bobman

            @th009
            Alfa’s not a victim of the current economic crisis; it’s been losing money long before Fiat got a hold of it. That’s why the Italian government gave it to Fiat. (Yes, gave it to them.)

            By rebadged Fiats, you must mean the MiTo and Giulietta. Both, very good small cars. There is no Dodge that wears an Alfa badge, I doubt there ever will be. (Nothing against Dodge) You didn’t mention the 4C due out later this year. It was to represent Alfa’s return. (Looks like a real Alfa to me.)

            I don’t think the Alfa plan was completely laid out yet; however, Sergio seems to understand the issues and has made several statements indicating a return of the brand. (there’s some references on Wiki you can look up)

            Anyway, I think I understand your appreciation for the Audi brand, however, there are many, like myself, that feel it wouldn’t really do much for Alfa. In fact, like the Lamborghini, it would, in fact, be like a dead man walking.

            I hope the deal doesn’t go through as I believe it would not be good for either VW or Fiat. It doesn’t make any sense and, more importantly, I can’t see how it would give Sergio the money he needs to get Chrysler. I think he would have a better chance with the banks.

          • 0 avatar
            GTAm

            Those racing programs no doubt contributed to hole Alfa made in Fiat’s finances. The Fiat management was atrocious back then. The cars were of very poor quality and customer service was disastrous. And before that in the 70s when Alfa was Alfa? It was even worse. Also don’t forget that those higher sales volumes they had back then was assisted by the closed Italian domestic market! After decades and decades of poor management it is not the easiest thing in the world to resurrect a brand. However now as Marchionne has shown everyone by turning around Chrysler, they know how to do it. But let’s also remember the problems in Europe, the militant trade unions in Italy and the chaos of the Italian govt. It can’t be the easiest place to resurrect a depleted brand. But yes sure, re-badging Audis would be an easy route no doubt to higher sales volumes. I would rather push an Alfa based on a Fiat or an platform co-developed with it’s subsidiary Chrysler or even Mazda who makes one of the best drivers cars in the world than an Alfa based on a boring grey VW/Audi. If people want such cars there’s always SEAT!

        • 0 avatar
          Athos Nobile

          “More like the Italian government begged them to take it”

          It could have accepted the offers from either Ford or VW back then. Fiat wasn’t alone in the queue.

          • 0 avatar
            bobman

            Agreed but I think they wanted to keepp it Italian. I didn’t see vw mentioned in the article I read but, I may have missed that.

          • 0 avatar
            Athos Nobile

            They wanted to keep it Italian and that’s part of the reasons it went to Fiat.

            The article I read was made a long time ago (circa 1997) and was reviewing what happened after the purchase.

      • 0 avatar
        GTAm

        Do you care to compare that with what Fiat has done with Ferrari? ;) According to brand equity it’s the most valuable brand in the world! Also remember that the world is a very different place today with the boom from China where buyers have little knowledge about heritage and racing DNA etc. That’s how VW gets away by selling big VWs badged as Bentleys. So yes Pizza hut will sell zillions of pizzas. But are those authentic Italian pizzas? :)

        • 0 avatar
          Athos Nobile

          “So yes Pizza hut will sell zillions of pizzas. But are those authentic Italian pizzas?”

          They won’t be Italian pizzas because probably they aren’t made in Italy. Also because they’re a version of the original thing, adapted to the tastes of whatever market.

          But does that really matter?

          Does an Italian pizza, made in Italy by a proper Italian bloke stop being Italian if it is made with German flour, tomatoes and mozzarella?

          • 0 avatar
            GTAm

            Germans make good sausages and beer. They should stick to that. Look at what they’ve done to Bentley. It’s not the materials and not where it’s made in. It’s the philosophy and approach. Just compare the Bugatti Veyron with the LaFerrari. Do you see a different approach or not? If you don’t then you’ll never know what I’m talking about. Alternatively take a long drive in an Audi and then in a comparable Alfa and see how you feel.

          • 0 avatar
            Athos Nobile

            You didn’t quite grasp the idea.

            Although I haven’t seat in a Bentley, I can somehow understand what you say.

            My point is, with the proper personnel, the car can be made to have the desired feel. So basically you can make an Audi drive like an Alfa. Basically an Italian pizza, made by an Italian bloke, using an Italian recipe but with German ingredients (maybe not all).

            I would have compared a regular Ferrari with its Lamborghini equivalent.

        • 0 avatar
          fredtal

          Bentleys use to be rebadged Rolls Royce. They really are a very nice car now.

  • avatar
    th009

    Lamborghini, like Alfa Romeo, was bleeding money when it was taken over. It now has 10x the sales and a vibrant operation (see my earlier post), compared to Alfa’s collapsed sales and closed museum.

    And still you think Lamborghini is the dead man walking? (You might want to take a look at the definition of that phrase in any case.)

    • 0 avatar
      bobman

      As I mentioned, I don’t see this transaction giving Sergio the funds he’s going too need to buy out VEBA. We’ll just have to wait and see what happens.

      • 0 avatar
        th009

        I don’t expect to see this deal happen, either.

        I just don’t agree with your assertion that Lamborghini is a dead brand while Alfa Romeo has a bright future with Fiat.

      • 0 avatar
        Athos Nobile

        Selling Alfa, MM and a couple of sites may not give Sergio all the coin he needs to purchase the VEBA stake. But you seem to forget that he’s very well connected to European banking institutions and that Chrysler is doing well ATM and probably sitting on nice pile of cash.

        I wouldn’t think Magneti Marelli is completely on the table for grabs as they’re very closely related to FIAT Group.

        To me it seems he doesn’t have the money for an Alfa rebirth. It is not quite clear how Alfa and Maserati are going to mix without having overlapping.

        VW certainly has the cash, business case, scale, architectures and will to make this work. Provided they get the brand, I see them using a version of Audi’s MLB architecture (RWD) to go after BMW or the hole that the Bavarians have left open as they have softened during the years. Alfa would also provide VW the opportunity to have more flamboyant design, things they can afford with their more established brands.

        I can totally see this happening. And after all is said and done, you guys can kiss Chrysler bye bye.

    • 0 avatar
      GTAm

      I think Lambo, Bentley and SEAT are still not making money. Correct me if I’m wrong…

      • 0 avatar
        th009

        Bentley is back in black after the financial crisis:
        http://annualreport2011.volkswagenag.com/divisions/bentley.html

        Lamborghini was profitable before the crisis, dipped into the red as sales fell, but is likely profitable again (current Audi financials do not break out profits for its subsidiaries).

        Seat is still losing money, as is well known.

  • avatar
    Piqutchi

    If Alfa gets sold to VW, then what brand will Fiat use to replace Alfa’s positioning? Will Fiat turn Dodge into a fully global brand?

    • 0 avatar
      GTAm

      Unlikely. Marchionne as said many times that Alfa and Jeep are the only truly global brand. They’ll probably have to bring Maser a notch down. I don’t see that happening as that would mean lower margins from the Maser brand.

      • 0 avatar
        Lorenzo

        I can see Jeep as a global brand, but Alfa? That’s a bit of Italian puffery to me. OTOH, the Mopar pentastar is well known globally, and Dodge, even Chrysler, could use it to advantage. Global brands must be full range, mass produced vehicles, not niche products. Sergio must be thinking of Alfa as a smaller, upscale world model using Fiat’s underpowered multi-air engines. What may kill Sergio’s hopes is the lack of a torquey, fuel efficient engine below the Pentastar V6.

        • 0 avatar
          GTAm

          You will be amazed at how well Alfa Romeo is known in all corners of the world. As I live in Asia I know how strong and even revered the brand was. Globally there are 350+ Alfa Clubs. The highest of any brand and they spread to all corners of the world. Watch the 4C launch speech by Harald Wester. He refers to leveraging on this popularity. It’s decades of neglect and under investment that have destroyed sales.

          “Fiat’s underpowered multi-air engines”???
          The Multi Air engines are class leading in power torque and emissions. Please check. Then there’s the new All Alu 1750 in the 4C that’s said to be good for 300bhp. There’s also the Maserati V6′s which were designed by Ferrari.

          • 0 avatar
            th009

            As you say, decades of neglect and underinvestment.

            Oh, but it’s different now, you say, there are great products coming and Alfa Romeo has a glorious future under Fiat? Well, consider this:

            “Under Alfa Romeo brand, the auto manufacturer will release Junior, which will compete with BMW Mini, in 2008, a C-segment sporty hatchback and 8C Spider, which is a soft-top 2-seat car, in 2009, and a crossover model in between SUV and coupe, and the 169 sporty sedan in 2010.”

            This was from Fiat’s 2007 plan, which set the goal of increasing sales from 140K to 300K by 2010. How did that go? How about the 2010 plan that set the goal of 500K units by 2014, with seven new models by 2014, and US re-introduction in 2012?

            Why is it that everything will be different this time?

  • avatar
    Athos Nobile

    In your first paragraph you basically stated the reasons for which ANY OEM with the means would be interested in buying the brand.

  • avatar
    GTAm

    @th009

    Why is that everything will be different this time? In a one word answer – “Chrysler”.
    Chrysler gives Fiat a massive jolt in economies of scale in development expenses, parts ordering and sales reach.

    The plans changed for many reasons. 1. Priority was given and resources focused on the Chrysler takeover. And quite rightly so from a business perspective.
    2. EU and especially Italy were heading for disaster. Marchionne read this early.
    3.He used the situation as a bargaining tool with the Italian unions whose work practices were/are inefficient. This is a well known fact.

    Could Fiat have successfully launched the 500 in the US without the Chrysler dealer network? I don’t think so. Those dealers are now waiting for a much bigger range including Alfa Romeo.

    Another reason why it should work this time is……. the 4C. It’s an amazing car like Alfas used to be. Cutting edge tech, class leading performance, driving pleasure oriented philosophy and stunning looks. The management seems to have realized where they went wrong all these years by launching a car like the 4C to relaunch the brands. The 8C was a bit half-hearted. Harald Wester talks about leveraging of the popularity of the brand through clubs globally. These things were never considered before.

    • 0 avatar
      Morea

      I don’t see the 4C as reviving Alfa’s fortunes because:

      1) It is a limited product model, only a few thousand will be made per year due to the limited rate at which the carbon fiber tubs can be produced;

      2) Fiat has already floated the idea of a V6 or V8 version for Maserati, this will undercut sales of the Alfa version;

      3) Lotus tried this concept with the Exige which never sold more than a few thousand per year.

      The 4C is a stunning car but it will not make Fiat any money nor produce much of a bump in sales of existing Alfa models.

  • avatar
    loquoman

    Since the Fiat group eoncompases many companies like for example New Holland, RAM Trucks, Case, Jeep, Iveco and Ferrari, it’s not clear why must they sell Alfa to VW. That must be a rummor started at VW/Audi, the last thing Fiat will want to do is help them.

    IMO, Fiat plans were to invest in Alfa’s revival, but they got an incredible chance to buy Chrysler for cheap during the financial crisis.

    At this point Fiat investments seem to be in the RAM half-ton and HD trucks, Jeep Grand Cherokee, Fiat 500 product line and Maserati.

    They picked Maserati ahead of Alfa, because that brand is stronger, so they can command a hefty premium and make money on much lower volumes. Maserati also already has worldwide distribution.

    The Alfa 156 and 147 averaged around 50,000 anual units during their production runs, despite being some of the best designed cars ever. Both European Cars of the Year with great dynamics, huge variety of engines and several variants.

    IMO Marchione is doing the right thing with the 8C Competizione and 4C models, to add strenght to the brand and to re-introduce the brand in North America.

    Of their premium brands, there is a clear difference between Ferrari and Maserati. Ferrari is the more upscale and sporty brand, while Maserati makes GT, 4 door luxury and exucutive sedans and will introduce a new Grand Cherokee based model.

    Alfa will probably sit bellow that, making smaller halo sports cars then Ferrari plus sporty oriented super minis, small family and small executive cars and an executive model. They are also certain to add Jeep Cherokee and Grand Cherokee derived SUV’s. 80-90% of sales volume for BMW, Audi and Mercedes-Benz come from that type of cars and SUV’s.

    Lancia should be a womens brand. And Fiat should add more models to the 500 line with their generalistic models. Fiat is doing fine in Brazil, where VW was once the indisputed leader, maybe they should expand in other emerging markets too.


Back to TopLeave a Reply

You must be logged in to post a comment.

Subscribe without commenting

Recent Comments

New Car Research

Get a Free Dealer Quote

Staff

  • Contributing Writers

  • Jack Baruth, United States
  • Brendan McAleer, Canada
  • Marcelo De Vasconcellos, Brazil
  • Vojta Dobes, Czech Republic
  • Matthias Gasnier, Australia
  • W. Christian 'Mental' Ward, Abu Dhabi
  • Mark Stevenson, Canada
  • Cameron Aubernon, United States
  • J Emerson, United States