Analysts seem skeptical of Alfa Romeo’s ambitious targets image

The experts that might swing potential investors one direction or the other are voicing concern that Fiat Chrysler Automobiles chief executive officer Sergio Marchionne would reach his high sales threshold for the revived Alfa Romeo brand.

Last week the automaker, the seventh largest in the world and the third biggest in the US, presented the first Alfa Romeo model in a planned turnaround strategy that would see another seven follow in the near future and the company investing 5 billion euro ($5.6 billion) through 2018. Various sources have only confirmed so far three models actually: the Giulia, a big SUV sometimes late next year and a flagship sedan model in 2017. “Despite our love of Alfa’s past, we’re unconvinced by its future,” comments 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,” he added. According to the industry watcher, the product introduction will eat up massive capital and would not yield any profit during the first production cycle.

Consultancy firm IHS Automotive forecasts worldwide Alfa Romeo sales would still go down this year, to 67,500 units from last year’s 68,300 autos as the current state of the lineup shows one thing: “neglect.” Low investments during the course of a decade have turned Alfa into a two model brand – the subcompact MiTo and compact Giulietta – mostly sold in Europe. Meanwhile, the global lineup uses a niche model – the 4C in coupe and spider versions. “5 billion euros and nostalgia doesn’t equal 400,000 units in 2018,” adds George Galliers, an auto analyst at the Evercore ISI brokerage house in London, talking about the ambitious sales goal set for the brand under the five-year business strategy of FCA.

Via Automotive News Europe