As an Alfista, the recent news about my beloved brand’s sales performances struck me hard, prompting some reflections about how FCA’s European arm could be ‘fixed‘.
The genuinely awful sales numbers posted by Alfa Romeo lately have once again placed the European side of FCA, best known as the one that burns the revenue generated in North America by Jeeps and trucks, under the spotlight. FCA’s current management seem somewhat unwilling to manage the clay-footed automotive giant created a decade ago, thanks to Sergio Marchionne’s opportunism and dealmaking ability.
The focus now seems to be mostly about maintaining the status quo until the sale of the whole shebang: Needless to say, such a non-strategy can last only so long, and mainly hangs upon Jeep and RAM sales in the USA: turmoil there would send the whole construction crashing down in no time.
The heart of the matter lies with the fact that FCA doesn’t generate nearly enough cash to appropriately fund and nurture the dizzying array of storied brands it owns. I believe it’s high time for someone to take some cold, hard decisions to right the ship and, possibly, let at least some of its European brands thrive.
First, we have Maserati, a name that every enthusiast loves, but that has been attached to compromised products for decades now. The decision to have Maserati competing with the best BMW, Mercedes, and Audi can offer proved misguided, at best. The harsh reality is that FCA can’t muster the technology, the quality, and the support to compete in that arena. Maserati has the recognition for being a proper high-end luxury brand, and it should let be one: a few thousand exotics to die for built at Modena each year, full stop.
Regarding Lancia, I hate to say it, but Sergio was right: I would leave the Ypsilon in production as long as enough Italians will buy it, then goodbye.
Fiat competes (well, it used to) in a mature, oversaturated European market that’s increasingly split between value and premium offerings, with little or no room in the middle. However, if there’s one thing that Fiat does well, it is cheap and cheerful, so I would fund the development of a new Panda and new B and C segment offerings to be built between Poland, Serbia, and Turkey to keep production costs as low as possible. This plan would spell the end of the former Alfasud plant near Naples once the current Panda goes.
Most of the available R&D resources for the European brands would of course be destined to beloved Alfa Romeo, to finally realize the marque’s revival initiated by Marchionne several years ago. Without the associated sales expectations though: Alfa Romeo will never be a volume brand, but it has shown remarkable resilience over the years: people want Alfas, but do not buy them, for two key reasons: lack of dealership support and lack of appealing models.
Let’s face it, the dealer shortage and the sub-par service standards the existing ones give cannot be solved rapidly enough. In Europe, I would imitate Tesla and initiate a direct sales model for Alfa Romeos; this way, the Company would expand its presence directly on premium locations and firmly control the performance of its sales and service staff.
The Giulia and Stelvio would get a refresh and hybrid variants before yesterday, together with the station wagon Giulia, European customers have been asking for since the model’s inception. The world-class Giulia Quadrifoglio would form the base of a stunning two-door, tire-shredder coupé to set the motoring press on fire, while the embarrassingly old Giulietta would be replaced with a hatchback made on the Giulia platform and designed to be pretty rather than practical, as those who wanted a Golf will buy the Golf regardless.
A sexy new coupé and spider Alfa Romeo, based on the still-modern Giulia platform, would be built in the small ex-Bertone Grugliasco factory that now builds the Maserati Ghibli and Quattroporte.
Last but not least, my salary as a CEO: one Euro, all expenses paid, just like the great Lee Iacocca did when he took on the task of saving Chrysler: you just can’t talk factory closures and layoffs with the unions when you get paid millions, right?