VENICE - Fiat Auto is counting on the new upper-medium range Lybra to lead the recovery of its Lancia brand.
The Lybra replaces the 10-year-old Dedra. It will go on sale in Italy in early September and will reach the rest of the Continent by the end of October.
Prices will range from L41 million-L54 million (euro 21,150-27,860, $22,145-$29,170). Standard features include antilock brakes, air conditioning and four airbags.
The segment is an important one for Lancia. Upper-medium cars like the Volkswagen Passat and Ford Mondeo accounted for 3.2 million sales in Europe last year - 22 percent of total sales. The Lybra is being positioned as a premium offering in the segment.
Lancia sold 181,750 units in 1997 and 178,000 last year. Sales in 1999 are expected to be between 160,000 and 170,000 units. But the brand is heavily dependent on its Ypsilon supermini and needs to do better selling premium sedans and station wagons.
Meanwhile the turnaround at Alfa Romeo, Fiat's other premium brand, is in full progress following the successful launches of the 156 and 166 models.
'Alfa's troubles were only caused by the lack of suitable models, while Lancia had much deeper image problems,' said Roberto Testore, Fiat Auto's president and chief executive, at the Lybra launch here. 'Therefore, we had to decide on two different recovery programs for both brands: one short-term for Alfa Romeo and a long-term restructuring for Lancia.
'Lancia's image was confusing,' Testore added. 'It had won six world championships for rallying, although it was never a sports brand. Outside Italy, where Lancia is not so well known, it was not understood.
'Therefore, we had to restore Lancia's brand identity and explain its values in markets outside Italy.'
Traditionally, the Lancia brand has stood for technical innovation, comfort, elegance and refinement. Alfa Romeo is primarily considered a sports brand. Fiat's own mainstream models are seen as popular and functional.
Giuseppe Perlo, head of product management for the Fiat group, said the company will not 'allow overlap between the three brands, which should be complementary.'
Television commercials for the Lybra will star actor Harrison Ford. In the advertisements, Ford 'plays a person who is attracted to beautiful things and who loves history and culture,' Perlo said.
Styling was changed
The Dedra was launched in 1989 and was successful early in its life cycle. But it only sold 8,824 units last year. It stayed in Lancia's lineup longer than expected because the Lybra was delayed by over a year. Adverse dealer reactions during clinics forced Lancia to redesign the car's front end and remodel the interior.
'The platform also needed re-engineering, since we wanted the Lybra to have comfort-focused rear suspension,' said Duilio Falcione, head of Lybra product development.
The Lybra is based on the latest evolution of Fiat Auto's D-platform - also used for the Alfa Romeo 156.
For the first time in its history, Fiat Auto will launch a station wagon version of the Lybra at the same time as a sedan. The station wagon is expected to account for about 60 percent of the new car's total sales in Italy, and about 50 percent of sales in the rest of Europe.
Turbodiesel versions are expected to make up half the demand in Europe and over 60 percent in Italy. The Lybra will be offered with a choice of 1.9-liter four-cylinder or 2.4-liter five-cylinder common-rail turbodiesel units.
Fiat invested L800 billion (euro 413 million, $432 million) to develop the car, including L200 billion in research and development, said Testore.
The Lybra will be built in the Rivalta plant, near Turin. The plant specializes in manufacturing Fiat's upscale models. It currently makes the group's two flagships, the Alfa 166 and the Lancia Kappa. Capacity for the Lybra is 350 cars a day with two shifts, for a potential output of 77,000 units a year. But Testore announced a more conservative target for the Lybra - 55,000-60,000 units a year for a planned life cycle of six years.
For the first full year, sales of the Lybra are expected to reach 40,000 in Italy, 12,000 in Germany, 8,000 in France, 4,000 in Spain and 7,800 in other countries. But it won't be available in right-hand-drive versions.
'Right-hand drive is not an option for the Lybra,' Testore said. 'We are not considering right-hand drive for the forthcoming Kappa replacement either.'