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Alfa Coming to U.S.? Don't Bother
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As I read the morning RSS feeds for this blog, I rarely have to clean up after a spit take. But here I am, swabbing down after the latest Automotive News story about Alfa Romeo's return to the U.S.
I refuse to believe Alfa's coming to the U.S., because I was around when they left in 1995, and things haven't gotten better.
There's so much wrong with the logic behind the News story - not the reporting, but if it's true, Fiat's logic behind bringing Alfa back -- that you have to laugh. The idea to get into the U.S. market is to either buy an old Big Three plant and retool, or to expand one of the company's Case New Holland factories. Sales would start in 2011 or 2012, and Alfa would expect to build about 150,000 vehicles a year for the U.S. and some for export to Europe.
Now, building for Europe I can see, since the U.S. is now a low-cost country. But everything else sounds like the Italian version of Punked!, in which some desperate state tries to get manufacturing jobs and gets stuck with Alfa instead.
Start from the premise. Buying an old factory and retooling might make financial sense, but the former employees of that plant will inevitably ask for jobs at the newly reopened plant, making a union work force more likely than not. That's not how any transplant has succeeded in the U.S., with the exception of Toyota at NUMMI. The rule is go greenfield - build your own factory and your own workforce far from existing plants and the UAW. It's sad, but true.
Second goof: in case you haven't read, Fiat, the U.S. car market is shrinking, not growing. Where are those 150,000 sales going to come from?
Third false premise: reliability. Even the lowliest Korean car has a higher quality perception and gets more red circles in Consumer Reports than the best Italian car. Given Alfa's past reputation, isn't it likely that not only will the cars have quality issues, but that shoppers will think they have more issues -- and report back to J.D. Power thusly?
Fourth, let's go back to sales. Fiat CEO Sergio Marchionne wants to build 150,000 Alfas and sell most of them in the U.S. Where will those buyers come from when Saab can't break 40,000 units a year?
What kind of folly makes second-tier automakers from Europe, China, and even Japan think that selling cars in the U.S. is a good idea? Is it Piechian vanity, or just a raw number sitting out there that has to be fulfilled for an up and coming capitalist to take the next step to becoming Prime Minister?
The thirst for Italian cars here may be roughly equal to the thirst for Italian-made coffee makers. I want one of those Francis Francis espresso machines desperately because they're stylish, technically fascinating and come in hot colors. And even though I'd pay $1000 for it, I don't think car shoppers are ready to pay $200,000 -- the equivalent markup -- for a 35-mpg hatchback with an iffy reliability history.
Call it a reverse DeLorean. It's not quite the swindle that China's MG suckered in the state of Oklahoma with, but it's bound for failure. Any elected state official that puts up tax dollars to play Alfa's game of doom should be deposed and forced to drive a Milano with a broken connecting rod as punishment.
Buyer beware.
Responses (19 total)
By Gary | Posted: Apr 17th 2008, 07:08:28 AM
Have to agree with Frasers comments and the use of a picture of an Alfa 147 in your article that was designed nearly 10 years ago and at the end of it's model life is indicative to the amount of though being put into this blog. The USA will not be getting the Alfa 147......
By Fraser | Posted: Apr 16th 2008, 07:51:44 AM
This is the sort of uninformed ignorant drivel that perpertuates the myth that Alfa Romeos are poorly built and unreliable cars. The new range is solid, beautiful to look at and be in, and are as reliable as VAG products, which are unimpeachably bland. The only downside in Europe has been the dealership network and even that's improving - not a problem for the US because you will have a new network from scratch.
Relax guys, look at the cars with an open mind and decide for yourself.
By Fred Marconi | Posted: Apr 1st 2008, 10:44:16 AM
"Buying an old factory and retooling might make financial sense, but the former employees of that plant will inevitably ask for jobs at the newly reopened plant, making a union work force more likely than not."
Yup, isn't that what happened to VW when they bought a former auto plant in Pennsylvania ?
On the other hand, IF they do go ahead, who's to say the considerably less dinosaur UAW of 2008 won't agree to a different tier of compensation for this start-up, as they agreed with Detroit last year for some (non-production) new hires?
Alfa quality is slowly on the up but word on the street here in Europe suggests dealer attitudes still need work.
By Wayne K | Posted: Apr 1st 2008, 12:12:04 AM
Wow, and here I was kind of looking forward to Alfa's comeback in the US. Silly me I guess. I mean I've only read about how much better their product has been getting. I mean I know they pulled out of the US in '95 and I was 19. Yes they made HORRIBLE cars then, but can't they change their image and products? Hell Ford, GM, and Chrysler are all making better cars today than they were in '95.....As far as the sales goals of 150k, yeah that is a tough one and I think that it will be tough to do, but I'm also not an expert there and haven't gone over the numbers or market research data.
Guess we'll have to wait and see.
By brian | Posted: Apr 1st 2008, 12:07:04 AM
"...and I think Maserati’s about 148,000 cars short of 150,000 units annually. "
When did Maserati ever state a 150,000 unit/year sales goal for the US?
Last I read, they sold 2600 cars in the US alone last year - a 20 percent increase since 2006 making 2007 it's best year ever.
I think I read that they have a goal for 2012 of 12,000 unit sales worldwide...
By Ed | Posted: Mar 31st 2008, 09:05:06 PM
"Remember when the idiots at GM lost 2 billion $ in attempting an alliance with Fiat? (they may even have bought the POS company)."
The damned fools at GM paid an arm and a leg to aquire Fiat, and then had to pay an extra $ 2 billion to get rid of it.
And then you compare the market value of Fiat to that of ... GM?
NEITHER of the two clowns has any respect in serious automitive cycles, esp. their products. of the two, I have to say that GM has made the most progress recently and may be the only US maker that will survive.
As for Maserati's alleged success in the US, I have some personal experience from good friends to tell:
First of, Maseratis are priced so cheap, some cost HALF of what the top mercedes costs, hardly an exotic, and 1/4th what a Mercedes McLaren costs.
Second, two friends of mine had the (lack of) wisdom to buy Maserati Quartroportes recently. ONE of them is incorrigible, because he had elased a jaguar XJ before, and it was an UTTER piece of JUNK, he told me it well deserved its reputation.
With the Maserati, of course, he did much worse. The brand new car was SUCH A LEMON, that the dealer had to accept its return and give him another new one.
By Sausca | Posted: Mar 31st 2008, 08:51:10 PM
Very poor response. To say Maserati is 148,000 short of 150,000 is a meaningless statement. Why don't say offer that Ferrari is 145,000 short of 150,000. BTW, did you in fact predict Maserati's success either in the US or Worldwide markets?
By Ed | Posted: Mar 31st 2008, 08:40:52 PM
Alfas are inferior POS unreliable cars, in Europe they are far cheaper than BMWs and therefore affordable. Market capitalization proves LITTLE, as TOYOTA has market cap 6 or 13 TIMES that of all Big 3 put together.
The undeniable fact is that, apart from the italian EXOTICS, NO Euiropean cars in the midpriced segment got what it takes to succeed in the USA, and those who tried have all failed miserably (Alfa in the past, Peugeot, Renault etc). Even the luxo makers, except for the big 3 in germany, did dismally and have either sold to third world nations (Jag, Land Rover) or still belong to Ford and GM with utterly inferior products and results. (Volvo, Saab).
The US market is TOUGH. It is NOT like in Europe, where a friend had to shell 17,000 EUROS for a lousy 1.4 lt (!) COROLLA. That's more than $27,000 US! For that kind of $ you can buy a V6 CAMRy or Accord here!
By Marty Padgett | Posted: Mar 31st 2008, 08:17:32 PM
I'm the adult who wrote it - and I think Maserati's about 148,000 cars short of 150,000 units annually. Also, "xenophobic" is spelled with an "x."
By Richard | Posted: Mar 31st 2008, 07:49:24 PM
Sorry I hit the wrong key and misspelled the CEO's name, it is Marchionne.
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