Don’t look down Sergio, because the analysts are revolting!
This afternoon’s reveal of the new Alfa Romeo Giulia will undoubtedly be the day’s big automotive story with the car’s styling and likely chance of success being foremost in commentator’s minds. But it’s worth pointing out this is not an announcement of a production-ready car; more a piece of theatre, aimed at a far more rarefied audience. But don’t take my word for it.
It’s inescapable now that FCA is in trouble. The €48bn Plan announced last year to turn around the former Fiat Group appears to be derailing. Having this year attempted to woo car giants into a super-merger and been rebuffed, Sergio is now attempting to get his way by force. Pivotal to this aim is the support of automotive financial analysts. Firms like IHS Automotive and Bernstein Research have grown massively in recent years. But like the movie columnists of the Hollywood era, their influence now risks outweighing their utility. Nevertheless, nobody appears to have told the be-jumpered one that you antagonise these people at your peril.
Having publicly berated them for failing to support his quest for a merger with General Motors – (a tie up GM have firmly set themselves against) – Marchionne has risked alienating the very people he desperately needs to bolster his hand. Just how far his star is fading is illustrated by Berstein Research’s Max Warburton, doyen of Automotive News’ industry analysis.
He minced few words on the Giulia’s announcement telling ANE yesterday he believes the Giulia’s announcement is aimed more at Global industry leaders than potential Alfa Romeo customers. He suggested the new car would undoubtedly “look great and boast huge power and performance.” But the omerta cracked open when he stated; “we think it is still developed on the cheap, far from production-ready and unlikely to sell in large quantities.” Not exactly a ringing endorsement then.
Warburton is not alone. Other figures within the automotive analytic community have expressed similarly worded misgivings; crucially nobody is prepared to believe Marchionne’s projections for growth. So with today’s announcement monopolising the bandwidth of the self-appointed, where does this leave those who might actually be minded to go out and buy one? No further than they were yesterday, to be honest. Because regardless of what you’ve been told, the Giulia doesn’t really exist and won’t do unless huge amounts of money are found to fund it. Even then, its chances of lasting success remain slim.
A lot can happen in four years, or in Marchionne’s case, despairingly little. Sergio must bitterly regret his haughty dismissal of Ferdinand Piëch’s overtures in 2011, because that tightrope walk’s starting to look awfully precarious.