Lancia Will Be No More image

Today, November 2nd, Marchionne announced in a teleconference the end of Lancia.

This is part of Marchionne’s restructuring plan and it includes a complete change of Fiat’s brand and model strategy. Besides the fact that he will give up on Lancia, Marchionne also plans to make Alfa Romeo and Maserati target the premium segment, Jeep will expand its global reach and product portfolio and Fiat will focus mostly on Fiat 500 and the Panda, building a number of derivates, similar to BMW’s strategy with Mini.

For 2012 and 2013 Fiat-Chrysler foresees a loss of $900 million and Marchionne announced he has no hope for profit before 2015 or 2016. Until now Lancia has been kept alive with rebadged Chrysler models, the last real new Lancia being the Ypsilon compact. A Chrysler spokesman told reports that ‘the Lancia brand will live on’, but that he doubts Fiat will made further investments in the brand.

Instead of closing plants in its home market, Fiat plans to export its expensive models to growing markets in Asia and the US. This will make Fiat more distinctive in the price-sensitive European market for smaller cars, where Fiat, Peugeot and Opel struggle to compete with VW, Toyota and Hyunday.