Fiat Chrysler Automobiles CEO Sergio Marchionne is counting on strong European demand for the new Alfa Romeo Giulia to spark a big comeback for FCA’s struggling subsidiary. He explained why the Giulia is “better than a German car” during an interview with Automotive News Publisher Jason Stein, Editor Rick Johnson and Staff Reporter Larry Vellequette.
You have called Jeep and Alfa Romeo the two biggest challenges in the relaunch of Fiat Chrysler Automobiles’ premium arm. Jeep is doing well. Will Alfa have the same success?
The big bet, and the one that’s by definition the riskiest, is the relaunch of Alfa. That’s why we went underground for as long as we did with the car to make sure that we had a technological proposition for the marketplace that was unassailable. This car [the Giulia midsize sedan] is better than a German car. I’ve been driving German cars all my life. The [Giulia] technically is better.
Is your goal to increase Alfa’s global sales to 400,000 by 2018 from 68,000 last year achievable?
Four hundred thousand is a big number. The fastest recovery by Alfa is going to be in Europe. Alfa’s got better pricing in Europe than it does in North America, so if I have to sell premium cars I would much prefer to sell them in Europe than North America [where the brand re-entered the market last November after a 20-year absence]. The relaunch of the Giulia within Italy and within Europe will catch on a lot faster.
Is the Alfa brand still strong despite its many lean years?
The brand is strong and it has a long heritage.
FCA is investing 5 billion euros to relaunch Alfa. This is your fourth attempt to make the brand a success. What’s different this time?
If you look at the history of our intervention as the owner of the brand, we have done nothing right with the exception of the last two models, the MiTo and Giulietta. [With these two cars] we did nothing great, but everything we did prior to those two cars was offensive to Alfa. We’re in the process of rebuilding and curing all those offenses, and it takes time. The only way to cure those ills is by proving the technical superiority of the car. The European response to the Giulia is that everybody is waiting for the car to be delivered.
When will Giulia deliveries begin?
At the end of the year. We will get traction, but it’s risky because a lot of good people have tried to do this stuff and not everybody’s going to be successful. I think we have put all the safeguards into that bet that we can, including the fact that I can stop the [5 billion euro] investment cycle if I want to. There are only two cars right now that are really done. The Giulia and the SUV, which is coming next year.
How flexible is Alfa’s new platform?
Technically, that platform will do everything from a 1-series to 5-series [sized vehicle] if you look at BMW [as a comparison] or an A3 to an A6 at Audi, but not an A8. The platform is rear- or all-wheel drive and hybrid capable.
How are you isolating Alfa’s engineering from FCA’s mass-market brands?
We are being incredibly careful not to team the development of Alfa with the stuff on the mass-market side. We are equally careful not to taint Maserati that way.
What challenges does this present?
To achieve that level of architecture and powertrain segregation within a big [company] you need a [high] level of discipline. When you look at the Alfa engine, 70 percent of the base engine development came from the greater FCA, the last 30 percent is from Alfa. That 30 percent is expensive and it’s pure Alfa. You need to be really smart and very disciplined to get it to the point where you take the highest possible synergistic value from the development of the engine and then you go sideways, which is what we’ve done with Ferrari. Three-quarters of the Giulia engine is from a Ferrari V-8, right? But if you look at that engine today and you compare it to Ferrari’s, there’s nothing in common other than the angle of the cylinders.
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