Alfa to add 8 models as part of 5 billion euro relaunch

TURIN -- Fiat Chrysler CEO Sergio Marchionne hopes that investing 5 billion euros ($7 billion) in Alfa Romeo will reverse a decade of losses and seven years of collapsing sales at the sporty brand.

Fiat will add eight new Alfas with the goal of boosting the brand's global sales to 400,000 vehicles in 2018 from 74,000 last year.

Alfa's entire future lineup will be underpinned by a new rear-wheel-/all-wheel-drive architecture called Giorgio, Fiat Chrysler said today while presenting the company's new five-year business and product plan.

Alfa Romeo CEO Harald Wester said this "best-in-class" architecture is capable of underpinning vehicles from the compact segment to the large segment, both for cars and SUVs. This means Alfa will not replace the slow-selling MiTo subcompact and that the replacement for the Giulietta compact will switch to rwd from the the Giulietta's fwd layout.

Alfa will be "entering new territories and segments we’ve never been in," Wester said. "We needed to reset all and simply go back to the Alfa Romeo that people admired,” he said.

Disrespected DNA

Wester cited examples of when, he said, Alfa Romeo lost its way, both before and after Fiat gained control of it in 1987, including rebadged versions of the Nissan Pulsar and Fiat Croma.

"Alfa Romeo had completely lost its DNA back in those days, and it morphed into whoever it partnered with," he said. "With the exception of style, the DNA of Alfa Romeo had not been respected."

Alfa often won on the track in Grand Prix races, but failed to execute the old automaker adage of "Win on Sunday, sell on Monday," Wester said.

In his presentation, Wester did not give a precise timing for Alfa's eight new models underpinned by Giorgio, saying only that the first one -– a mid-sized model -- will debut in the final quarter of 2015, while the other seven will come between 2016 and 2018.

This could be the new Alfa range, according to Automotive News Europe sources:

• Compact: Two body styles are planned for the Giulietta replacement, which will get a new name. One will be a sporty four-door model similar in concept to the Mercedes CLA and the second will be a variant with extra luggage space similar to the Audi A3 Sportback.
• Mid-sized: A mid-sized sedan will be the first of Alfa's new models and is set to debut in Europe in late 2015 and in the United States in 2016. Originally due in 2014 badged as the Giulia, the four-door sedan possibly will get a different name. It is a successor to the Europe-only 159 sedan discontinued in 2011. Alfa will add a second body style a year after the sedan is launched, most likely a sporty variant with extra luggage space. This model could take inspiration from the sloping tail of the Mercedes CLS rather than being styled as a traditional wagon like the 159 Sportwagon.
• Large: Alfa will get a flagship model. The project was started in late 2012 as a derivative of the Maserati Ghibli and was intended to launch by the end of this year. Last summer, Alfa shelved the idea of using Maserati’s underpinnings -– regarded as too expensive for Alfa –- in favor of the Giorgio architecture.
• Specialty: Alfa's presentation on Tuesday referenced a "specialty" model without giving any details. Most likely it will be a rival to BMW’s 6-series range and will become Alfa's halo model. Alfa was supposed to get a roadster built by Mazda next year as a halo car, but this vehicle will now be sold by the Fiat brand.
• Compact/mid-sized SUV: The high flexibility of the Giorgio architecture will allow Alfa to build a crossover positioned between the BMW X3 and X5.
• Large SUV: Alfa has long planned a large SUV, mainly for the U.S. market. Born as a derivative of the Jeep Grand Cherokee and then planned as a sibling to the Maserati Levante, the SUV will now be based on the Giorgio architecture.

Shared architecture

A team of about 200 engineers based near Maserati’s headquarters in Modena, Italy, is developing the Giorgio architecture. Heading the team is Philippe Krief. He reports directly to Wester, who is also chief technical officer at Alfa's parent, Fiat Chrysler.

Wester said Alfa must "institute the rigor, the discipline and the measurements to meet the target of the first start of (new-model) production in the second half of 2015 and launch eight products."

The Giorgio architecture is flexible enough to be used by the Chrysler and Dodge brands because Alfa alone cannot generate sufficient volume to achieve worthwhile economies of scale.

Alfa will focus on developing premium vehicles to be exported worldwide from Italy, just like sister brand Maserati.

An effective Alfa relaunch is a crucial element in Marchionne’s broader strategy to return Fiat’s automotive division to profitability in Europe by 2016. Fiat's European unit lost 2.1 billion euros in the last three years and so far Alfa has yet to make a profit under Marchionne’s 10-year watch.

Neil Bunkley and Reuters contributed to this report