By on April 10, 2011

A report from Automotive News Europe [sub] says that Alfa-Romeo’s return to the US market has been delayed from late 2012 to 2013, as its parent company Fiat struggles to work out a satisfying turnaround strategy for the sporting brand. According to ANE’s sources,

In a presentation to bond holders held on March 29, [Fiat CEO Sergio] Marchionne showed a slide that said the Giulia sedan and wagon, which will replace the 159 sedan and Sportwagon, would be made in the United States starting in 2013. A year ago that slide, which was part of Fiat Group’s presentation of its five-year strategic plan, showed the Giulia models being built in Italy and debuting in North America in late 2012 as part of the brand’s return there. The Fiat spokesman now says the company still needs to decide where the make the Giulia.

Once again, Fiat finds itself torn between competing government backers. Should Fiat build the Giulia, which will be closely related to the replacement for the Chrysler 200 and Dodge Avenger, in the US (as a thank-you for receiving a bailed-out Chrysler) or in Italy (to keep jealous politicians and labor unions happy)? But it turns out that this isn’t even the extent of Alfa’s problems…

The Giulia’s delay is only partially due to Fiat’s political choice… the main reason is that “Sergio Marchionne is not satisfied with the design of the cars that will lead the brand’s comeback in the crucial market.” The report explains:

Alfa parent Fiat S.p.A. has pushed back the arrival of the Giulia models to mid-2013 from late 2012, the sources said. They blamed the delay on manufacturing and styling issues with the cars, adding that Marchionne was not pleased with proposals he has seen from Alfa’s creative team in Turin. A Fiat spokesman declined to comment when asked about the delay. Another factor slowing the Giulia’s launch, the sources said, is that Marchionne is not happy with the design proposals he’s seen from Chrysler’s U.S.-based stylists in Auburn Hills, Michigan, for the Giulia’s two siblings, the replacements for the Chrysler 200 and Dodge Avenger, which are due in 2013. The timing of the three mid-sized models is linked because they will share a platform, powertrains and major subsystems. Fiat owns 25 percent of Chrysler Group and is working to integrate the Italian and U.S. automakers.

On the one hand, this is fairly good news: having rushed the 200 into production as a stop-gap replacement for the much-maligned Sebring, it’s heartening to hear that Marchionne is taking the time to get its replacements right. After all, without a legitimate D-Segment competitor, neither Chrysler nor Dodge will ever regain their status as mainstream brands, and Alfa’s re-introduction to the US could yield little in the way of new volume.  On the other hand, both Chrysler and Dodge need these models yesterday… and so does Alfa. ANE notes that, with the MiTo, Giulietta and 159, Alfa’s lineup has now been shrunk to Saab’s size. And it won’t get any new models until a C-segment crossover/SUV goes into production in late 2012.

With analysts estimating Alfa’s annual losses in the €200m+ range, the lack of forthcoming new products is raising serious questions about Alfa’s viability even in the short-to-middle term. Max Warburton of Bernstein Research notes

The Alfa plan looks more and more overambitious by the day. With just the Mito and Giulietta in the next few years, there’s probably not a robust enough platform of customers and dealers to power up to 500,000 units. Conquest sales in Europe and the U.S. will need to be massive to hit the target. Entering a new market means losing money for some year. And we all know conquest sales even in existing markets like Europe are horrendously expensive to achieve.

Meanwhile, Alfa’s volume ambitions must also be weighed against its enthusiast and brand-building ambitions. Alfa’s $60k+, 1,500-units-per-year Porsche Cayman-competitor, the 4C, could well be another money-loser for the brand, offering a Dallara-designed carbon-fiber tub construction at a price far lower than any other similarly-built car on the market. VW Chairman Ferdinand Piech has reportedly offered €800m for the Alfa brand, in order to wrap the 4C’s Italian styling around its turbo-flat-four “Baby Boxster,” an option that woud rid Fiat of a problem brand while complicating VW’s already-convoluted sports car strategy. But until Piech offers something closer to €2b for the brand, Fiat isn’t likely to bite. Which means Alfa’s future could remain up in the air for some time to come.

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25 Comments on “Alfa-Bits: US Launch Delayed, Strategy Problems Arise...”

  • avatar

    Sad state of affairs for such a storied brand. Glad to see Marchionne hard at work. Maybe he’ll be able to prove his mettle once again.

    • 0 avatar

      There is no doubt that Marchionne is a smart guy, but he’s been running Fiat since 2004, and Alfa’s sales are still stuck in a rut after seven years.  How much time does he need to fix Alfa?

    • 0 avatar

      this rumor has just been denied by Sergio himself today. He confirmed that AR’s launch in the US is scheduled for 2012 as planned.

  • avatar

    I’d love an opportunity to buy a 159. Or a MiTo. Better looking than anything else in their segments, and the couldn’t be any worse than a Chrysler, could they?

    • 0 avatar

      “I’d love an opportunity to buy a 159. Or a MiTo.”

      Trust me, once you’ve driven a MiTo particularly in TCT dual clutch form you’ll never want to sit in an Alfa again. It is an horrible piece of turd. The dual clutch gearbox is truly woeful and the start -stop feature verges on the lethal (the car takes about 3 seconds to restart + time for the TCT to engage a gear). The ride is like an old horse cart with the rear end continuously skips about. The cabin ergonomics are just breathtakingly bad and the engine is just gutless. It is difficult to believe that a car like this could come out of a major vehicle manufacturer in this day and age.

      I have a four year old base model Ford Focus that is in every way a better sporting drive than this POS Alfa.

  • avatar

    Alfa strikes me the same way Saab does: a perpetual money loser with perpetual potential according to its enthusiasts.  Marchionne should take Piech’s money and never look back. 

    • 0 avatar

      Marchionne should take Piech’s money and never look back.

      It might be a good idea for the economy of Fiat Auto (at least in the short term), but for Alfisti it would be a tragedy, as a VW takeover of Alfa Romeo would be tantamount to the death of Alfa Romeo. Nobody who cares about Alfa would want that to happen.

      • 0 avatar

        As much of a death of Alfa Romeo as the Fiat takeover was considered to be in 1986?

        Note that both the 159 and the Brera were designed by Giugiaro’s Italdesign, which is now part of the VW Group.

    • 0 avatar
      Athos Nobile

      Key in the strategy would be keeping the “soul” (read engine) Alfa. Fiat pulled a nice trick during its GM partnership using GM shortblocks with an Alfa top end and calibration. Opinions are mixed however.
      I guess that in Piech’s machinations, Alfa would be more Audi-related than VW-related. If so, we could see the rebirth of a proper Alfa, i.e RWD. I would even venture to say that his idea would be to go after BMW’s 1 and 3, maybe 5, add some coupes and crossovers to attract buyers. I don’t see a full model line since it would still be a niche deal.
      He can do with this brand, which is powerful and respected, things he can’t with Audi or VW or any other brand in VAG’s portfolio.
      Although I prefer an Italian Alfa, it’s still interesting to know what are VW plans for it. IIRC they were after it along with Ford in the 80’s before Fiat took it.

  • avatar
    Dr Lemming

    A niche brand doesn’t need to compete model-for-model with the bigger players.  Look at Subaru, which has done quite well with a fairly limited range.  Compare Subaru’s success in the US with Mitsubishi, which for years vainly spread its resources across too many platforms and models.

    Why does Fiat need three D-segment offerings?  And how meaningful will an Alfa variant be if it is merely a reskinned Dodge?

  • avatar

    With Saab like size, Alfa won’t have the luxury to have all its own cars. Alfa isn’t such a premium car as BMW. The only way they can make a profit is by sharing models, which ovioulsy only works if they do it like VW, where it isn’t too obvious to the costumer. A Seat Ibiza, VW polo and Skoda Fabia are the same cars that look differently to the costumer.

    • 0 avatar

      Well, you forgot AUDI…and they seem just as premium as bmw ot me. BTW, some BMW in Europe share engines with Peugeot, and in the future there will be even more of that.

  • avatar
    Athos Nobile

    I like the style of the 159 better than the Giulietta or MiTo. Actually don’t see why killing the model if there’s no replacement in sight. The thing looks GORGEOUS.

  • avatar

    Perhaps I’m a bit slow on the uptake – and perhaps it’s not all that important – but I’ve yet to figure out the pecking order of the various Fiat-Chrysler brands.
    With Alfa Romeo and Lancia in the fold, it’s almost as though Chrysler (the marque, not the organization) has become redundant, even though Chrysler began moving decidedly down-market about 50 years ago.

    • 0 avatar

      Fiat – base, eco
      Dodge – unpretentious sporty
      Alfa – pretentious sporty
      Chrysler/Lancia – near luxury – even though they had very different historical approaches to that
      Jeep – SUVs
      Ram/Fiat Professional – trucks
      Ferrari/Maserati – Ferrari/Maserati

      • 0 avatar

        Thanks, Type57SC. If we were to draw a comparison to Chrysler of the 1950s, it’s almost as though Fiat is the new Plymouth, Alfa is the new DeSoto and Maserati is the new Imperial. I’m still not sure what Lancia is…

      • 0 avatar

        What is Lancia?  A faint shadow of its former self.  Three small rebadged Fiat hatchbacks and a rebadged Fiat minivan.  How does that match up to the Lancia tradition?
        “I knew the Lancia Delta Integrale, and you, sir, are no Delta …”

  • avatar

    The money in my Alfa Romeo fund is already starting to burn a major hole in my pocket.

  • avatar

    Call the Giulietta the “Chrysler 100 by Alfa Romeo” and the MiTo the “Chrysler 50 by Alfa Romeo”, and be done with it! Then, the Giulia will simply become the next 200.

    No need to set up a separate dealer network!

  • avatar

    I can wait another year or so.  Heck, we’ve been waiting since ’94.  The 164 is over 200K.  She’ll be good for 300K, providing I stock up on the spares.

  • avatar
    Sam P

    Alfa would be in much better hands as a VW Group brand than with Chrysler. VW has many issues, but it does know how to differentiate brands (except for that time in the early 2000s when luxo VWs like the Passat W8 and Phaeton were sitting squarely in Audi territory).

  • avatar

    This is al Bullcrap, Marchionne has just denied this rumor a few minutes ago, and confirmed the Alfa Romeo US launch is scheduled for 2012. Maybe PIech had something to do with this rumor :D

  • avatar

    Audi is a money loser for WV, in the way Piech is managin it. He bought our Lamborghini, and did ripped off the tech to build clones like the R8 (R8=Gallardo).
    I am 100% Alfista and personally owe a MiTo 1.4 Turbo 155hp (swiss-perfection engine and comfort) and my parents got a classic 156 2000cc (~10 years not a single malfunction, apart from replacing the exaust a couple of times, and oil refill), so you can call me an Alfa fanboy, but I must admit that Audi is killing us with their engines. Ok their design are choppy and very… square.. but if one wants to spend, can buy an A5 S5 with very powerful motors we can have only on maserati or ferrari.
    Can anyone remember Audi more than ten years ago? At the times of Audi 80 ? Those cars were horrible, kiddish, boilers on wheels, and now look at them. This denaturation of Audi is a black hole in WV budget for sure, and Piech is demanding Alfa Romeo at any cost to split the sport line on Alfa and Classy line to Audi, as it should logically be. Piech tried to match the success of MiTo and Mini with the A1 but since all this months, I’ve seen just an A1 so far, so I believe it had to be a failure. I mean, WV needs Alfa to learn to build powerful, quality and cheap cars.
    But as Top Gear’s Jeremy Clarksons says: buying an Alfa is a matter of hearth. Like iPhone stuff. They see that SGS is far better, but they insist pretending that their apple product is unbeatable. And is true. At least if you don’t buy a cheap entry-level MiTo as I read in this forum, you will fall in love almost instantly. Can’t say why. It’s not the pattriotism. It’s not the quality, it’s not the gorgeous look, not the known defects, it’s something you can feel just when turning the ignition on on an Alfa.
    Alfa isn’t something that you just drive, is something that you feel in your fingers! It’s strange, can’t describe it. Nor jeremy clarkson never was able to do even if he runs a tv program.
    BTW I believed Lancia was at a dead end, since the awful and shitty “Y” .. libra, musa, k, thesis… a failure next to each other. But strangely Marchionne pushes harder onto Lancia than into Alfa. We’ll see.
    But selling AlfaRomeo to foreigners would be far much worse than selling Ferrari! Marchionne knows this very very well and simply can’t do that. It’s a hard load to carry at the moment, but MiTo and Giulietta are selling quite good, and now it’s time to renew the police-car-segment, the 155->156->159->Giulia has to come very soon, also because the Giulietta chassis is modular and is ready to mount the trunk (in fact, the Giulia will be the Giulietta + a trunk, just like 147 and 156 in comparison). Probably marchinne isn’t satisfied with the interiors and electrionics or the engines that will be available. To make it a BMW-Audi competitor again it would need also >250HP engines, which alfa already has, but in loads of variants, while Alfa at the moment has plenty of choices between 100hp and 230hp… and the next step is 300HP. The leap is quite huge.

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