Skip to main content
Sister Publication Links
  • Automotive News
  • Automobilwoche
  • Automotive News Canada
  • Automotive News China
Subscribe
  • Subscribe
  • Newsletters
  • Login
  • HOME
    • Latest news
    • Automakers
    • Suppliers
    • New Product
    • Environment/Emissions
    • Sales By Market
    • On The Move
    • Auto Shows
    • Munich Auto Show
    • Geneva Auto Show
    • Paris Auto Show
    • Beijing Auto Show
    • Shanghai Auto Show
  • Features
    • Long Read
    • Interview of the Month
    • Focus on Electrification
    • Focus on Technology
    • Segment Analysis
    • Cars & Concepts
    • Supplier Spotlight
    • Europe By The Numbers
  • Opinion
    • Blogs
    • Commentary
    • Guest columnists
  • Photos
    • Photo Galleries
    • Geneva Photo Gallery
    • Beijing Photo Gallery
    • Frankfurt Photo Gallery
    • Paris Photo Gallery
    • Shanghai Photo Gallery
  • Podcasts
  • Car Cutaways
  • EVENTS
    • ANE Congress
    • ANE Rising Stars
    • ANE Eurostars
    • Meet the 2021 winners
    • Browse photos from the 2021 awards ceremony
  • More
    • Publishing Partners
    • Social Media
    • Contact Us
    • Media Kit
    • About Us
    • Capgemini: Securing the industry's future through a radical rethink
    • Capgemini: Succeeding with the automated driving journey through AI
    • HEXAGON: Plugging into data is the only way to make winning EVs
    • TUV Rheinland: Battery testing center for large battery packs and more
    • TUV Rheinland: Ideas, services and certifications for smart mobility
    • TUV Rheinland: Testing of automated and autonomous vehicles on test tracks
    • Toyota Europe
    • UFI Filters
    • Facebook
    • Instagram
    • LinkedIn
    • Twitter
MENU
Breadcrumb
  1. Home
  2. Automotive News Europe
June 29, 2015 01:00 AM

Alfa Romeo's high goals doubted by analysts

Luca Ciferri
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    The Giulia is the first model in FCA's revival plan for Alfa.

    TURIN -- Analysts are skeptical that Fiat Chrysler Automobiles CEO Sergio Marchionne can achieve his ambitious sales goals for Alfa Romeo.

    "Despite our love of Alfa's past, we're unconvinced by its future," said Max Warburton, an analyst at Sanford C. Bernstein.

    "While it has history, turning it into a credible premium player will be like launching a new company. It took Audi 20 years or more," Warburton added.

    In his view, Alfa's product revival will swallow a significant sum of capital and has no chance of posting profits in its first product cycle.

    The Giulia is the first model in FCA's 5 billion euro ($5.6 billion) plan for Alfa. Confirmed by sources so far are three models: the Giulia, a large SUV in late 2016 and a flagship sedan in 2017.

    Max WarburtonSanford C. Bernstein Ltd.

    "Despite our love of Alfa's past, we're unconvinced by its future."

    Thin lineup?

    Consultant IHS expects global Alfa sales of 67,500 this year, down from 68,300 last year, with the current, neglected lineup. Minimal investment in the past decade reduced Alfa to just two mainstream models -- the MiTo subcompact and the Giulietta compact, sold mainly in Europe -- and just the low-volume models for global markets, the 4C coupe and Spider.

    In May 2014, FCA unveiled a plan for Alfa that envisioned eight new models from 2015 through 2018. The lineup would generate 400,000 global sales by 2018 -- about 150,000 from North America.

    Marchionne at last week reconfirmed the 400,000 Alfa sales target by 2018, adding only that a second model will debut six months after the Giulia. 

    Warburton estimates that 130,000 of these North American sales should come from the U.S. -- if it were to achieve that 150,000-unit goal. However, he does not see an Alfa range broad enough to reach such a volume. 

    "It is clear that in the U.S., car sales grow pretty much in proportion to how many models OEMs offer. Audi sells 180,000 units in the U.S. with over 20 models [on various nameplates], Infiniti 120,000 with about 10 models. It seems inconceivable Alfa could hit its North America target with just two or three cars," Warburton said.

    Nostalgia isn't enough

    George Galliers, an auto analyst at the Evercore ISI brokerage house in London, said, "5 billion euros and nostalgia doesn't equal 400,000 units in 2018."

    In his view, Alfa Romeo is a niche brand favored by enthusiasts who tend to be ruled by their heart over their head.

    "Such brands' unit sales growth tends to be strong at first, given low bases and the rush of enthusiasts to the product, but plateaus very quickly as mainstream buyers stay away," he added.

    Galliers noted that similar sales patterns are prevalent at other niche brands, such as Maserati and Jaguar.

    Galliers called for a "blue sky" scenario where Alfa sales could reach 330,000 units by 2018, while IHS forecasts just 216,000, slightly more than half of the 400,000 target. LMC Automotive predicts 251,000 units in 2018.

    "If the Giulia doesn't meet expectations, then Marchionne could finally let it lie" with the brand, said Ian Fletcher, an analyst at IHS in London.

    RECOMMENDED FOR YOU
    Hyundai Europe boss Michael Cole to speak at Automotive News Europe Congress
    Related Articles
    Alfa's high-power reboot
    Alfa Romeo Giulia
    Recommended for You
    Mike_Cole_Hyundai_2020
    Hyundai Europe boss Michael Cole to speak at Automotive News Europe Congress
    Aldo Kamper Leoni 2022
    CEO of wiring systems supplier Leoni to speak at Automotive News Europe Congress
    Wolfgang Bremm von Kleinsorgen Mercedes web
    Mercedes Central, Eastern Europe boss von Kleinsorgen to speak at Automotive News Europe Congress
    Sign up for free newsletters
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    You can unsubscribe at any time through links in these emails. For more information, see our Privacy Policy.

    Get Free Newsletters

    Sign up and get the best of Automotive News Europe delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    You can unsubscribe at any time through links in these emails. For more information, see our Privacy Policy.

    SUBSCRIBE TODAY

    Get 24/7 access to in-depth, authoritative coverage of the auto industry from a global team of reporters and editors covering the news that’s vital to your business.

    SUBSCRIBE NOW
    Connect with Us
    • Twitter
    • Facebook
    • LinkedIn
    • Instagram

    Founded in 1996, Automotive News Europe is the preferred information source for decision-makers and opinion leaders operating in Europe.

    Contact Us

    1155 Gratiot Avenue
    Detroit MI  48207-2997
    Tel: +1 877-812-1584

    Email Us

    ISSN 2643-6590 (print)
    ISSN 2643-6604 (online)

     

    Resources
    • About us
    • Contact Us
    • Advertise with us
    • Advertise with Us
    • Ad Choices Ad Choices
    • Sitemap
    Awards
    • Rising Stars
    • Eurostars
    • Leading Women
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Automotive News Europe
    Copyright © 1996-2022. Crain Communications, Inc. All Rights Reserved.
    • HOME
      • Latest news
      • Automakers
      • Suppliers
      • New Product
      • Environment/Emissions
      • Sales By Market
      • On The Move
      • Auto Shows
        • Munich Auto Show
        • Geneva Auto Show
        • Paris Auto Show
        • Beijing Auto Show
        • Shanghai Auto Show
    • Features
      • Long Read
      • Interview of the Month
      • Focus on Electrification
      • Focus on Technology
      • Segment Analysis
      • Cars & Concepts
      • Supplier Spotlight
      • Europe By The Numbers
    • Opinion
      • Blogs
      • Commentary
      • Guest columnists
    • Photos
      • Photo Galleries
      • Geneva Photo Gallery
      • Beijing Photo Gallery
      • Frankfurt Photo Gallery
      • Paris Photo Gallery
      • Shanghai Photo Gallery
    • Podcasts
    • Car Cutaways
    • EVENTS
      • ANE Congress
      • ANE Rising Stars
        • Meet the 2021 winners
      • ANE Eurostars
        • Browse photos from the 2021 awards ceremony
    • More
      • Publishing Partners
        • Capgemini: Securing the industry's future through a radical rethink
        • Capgemini: Succeeding with the automated driving journey through AI
        • HEXAGON: Plugging into data is the only way to make winning EVs
        • TUV Rheinland: Battery testing center for large battery packs and more
        • TUV Rheinland: Ideas, services and certifications for smart mobility
        • TUV Rheinland: Testing of automated and autonomous vehicles on test tracks
        • Toyota Europe
        • UFI Filters
      • Social Media
        • Facebook
        • Instagram
        • LinkedIn
        • Twitter
      • Contact Us
      • Media Kit
      • About Us