Alfa Romeo: to be or not to be

Alfa Romeo is perhaps Fiat’s most interesting brand. Its sportive soul and tradition have been always part of it, no matter its results in terms of sales and profits. A brand that is loved or hated, but does not generate indifference because of its particular history and the models it has offered up today, have placed it in the center of discussion. Today the question about it is if this great name will be able or not to continue with its glorious past in a really complicated future.

If the discussion takes place looking at today’s situation, certainly most of people would say there is nothing to do about. Alfa just offers 2 models, with only 1 body option, which are MiTo 3 doors and Giulietta 5 doors. None of them lack of beauty and sportiveness. But are not enough to reach big numbers. Only Giulietta had a good start which has been severely affected by new generation of 1 Series from BMW and will be even more when new Mercedes A Class, new Audi A3 and new Volvo V40 will be available. It means Alfa is moving slower and so its sales numbers: just in Italy (40% of total sales), its registrations have constantly decreased since July/11 and its market share dropped from 3.33% in 2011 to 3.12% in the first 4 months of 2012. In a market which is dramatically falling 20% (Jan-Apr/12), Giulietta’s registrations are 25% down, while MiTo’s 42%! And that’s only in Italy, but is happening in all Europe.

However, the discussion must be done taking into account future plans and the potential Alfa has. It is well known by everyone that VW is very interested in acquiring this company. They have said the potential it has worth it and there so many things to do with its good image. Something that Mr. Marchionne has always said: Alfa is a key player in the group because of what it means. Therefore, the analysis should look forward to coming years when more models will arrive and hopefully with a different approach. Alfa does not need only D and E segment cars but also a strong and unique SUV (or more). And the most important: positionate them in a different way in order to offer a sporty familiar car with great performance and handling and so, in a different subsegment from Germans. That is to become the new Abarth for upper segments, in which more clients would buy them because of unique driving sensations, exclusive design shapes and because it is an Alfa.

By doing so, Alfa could easily reach 500.000 units by the year 2016, specially if Fiat guys do it well in America, increase market share in Europe and Italy and explore interesting luxury car markets such as China, Middle East and Russia.

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