Once again the Alfa Romeo’s possible sale issue. This time some ‘important’ analysts change the buyer name and add some more companies to the purchase. According to them, Alfa Romeo would be sold to Audi along with Pomigliano plant and maybe Magneti Marelli car component company. This would be part of VW’s plans to expand its business in Italy after the purchase of Ducatti, Italdesign and Lamborghini. Yes, Mr. Piech has repeatedly said he would love Alfa Romeo to be part of his empire but Mr. Marchionne has repeatedly said that it is a key brand for Fiat-Chrysler. Personally I am about 95% sure that under Marchionne’s administration, Fiat won’t sell Alfa Romeo to VW, just because as he says, Alfa Romeo may be generating loses now but it is one of the few promising brands of the group. Selling Alfa Romeo to VW would be like giving Jeep to GM: it is just not feasible. Still, many things can happen and current European situation is an alarm to Fiat to speed up with its plans for the Biscione brand.
Lets say that Fiat sells Alfa Romeo to Audi, just as it was said last week. I try to imagine how it would be positioned among VW Group’s brands. There are 4 main brands, Skoda, Seat, VW and Audi, which are strategically positioned and have their own personality. Seat is the ‘sporty-cheap’ brand with ‘latin roots’. Skoda is the ‘cheaper’ VW. Volkswagen brand is the core brand with the largest range of products and correctly positioned as the ‘quality for all’ brand. Then comes Audi, the entry premium brand (then comes Porsche, Bentley and Lamborghini), as the next step after having a Volkswagen. Based on sales registrations, anyone could say that this positioning has worked. Seat could be the only brand not to produce good results so far, as VW has failed to position it as a sporty brand. Anyhow, VW Group gets ready to occupy pole position as the best-selling car maker in the world. They deserve it after many years of hard work and good luck. But it seems the large quantity of brands they own is not enough for the success equation and Alfa Romeo is a target since many years ago.
How would it be positioned if it becomes part of the German group? between VW brand and Audi? there are no big differences between a Golf and an A3, a Passat and an A4. The other option would be to position Alfa Romeo just one step behind VW brand, but the history of the Italian brand indicates the it has much more pedigree than a Volkswagen (the car of the people). How would they position a Giulietta along with the Leon, Octavia, Golf and A3? Or what would be the future of a Giulia (D-Segment sedan) being part of the same family that produces the popular A4/A5? It has been said that VW wants Alfa Romeo to become its sporty premium brand as a direct rival of BMW, while Audi would focus on Mercedes field. So Germans would count on 2 premium brands with different approaches. It means that Alfa Romeo would be positioned at the same level of Audi, just as Marchionne wants. Personally, I don’t think this scenario would result in something good for the Italian brand, even if VW as a group has a brilliant future.
My skepticism is based on what currently happens with Audi, VW brand, Porsche and Lamborghini. Besides the problems with the positioning of the brand, Alfa Romeo would face the similar situation that is having Lamborghini. If you see carefully, Lamborghini has not had the same fast evolution that Porsche has experienced. Of course they have done awesome cars and keep working on the latest technologies in order to beat Ferrari. But when it is about sales forecasts and future projects, Lambo stays far behind Porsche. They are different brands and of course Lamborghini is not supposed to become a volume auto maker. But in terms of show, Porsche is always in the headlines, while Lambo will continue to be the craft sporty brand. I’m afraid the same could happen to Alfa Romeo with Audi. Audi is the pampered child of VW Group and a foreigner wouldn’t change that. It is my belief that Alfa Romeo would have the same future Lamborghini is having now: to become a symbol without big numbers. In total, the Italian brand would become the second one after Audi, with less importance than the one it will have under Fiat administration. If we consider tha fact that this possible deal would include selling Pomigliano plant it just doesn’t make sense. Fiat has just invested 850 million euros for the production of its best-selling car in Europe, and it is certainly not the right plant to get rid off (its best in Italy). Once again, a bad joke.