Re: Alfa & Fiat future

[Nicky Avery <nicky@domain.elided>]

Leo,

> italians need a car
> which can be compared, also in mechanical layout, to
> the Mercedes and BMW, not to the Peugeot.

That's already been tried - Lexus, Infiniti. The difference between them
and GM/FIAT/ALFA is that the Japanese had a real labor cost/productivity
advantage when they did it and the ability to beat the Germans on their
own
turf of quality. GM/FIAT/ALFA has neither and so it has to compete on
differences: it has to be on the Italianness of the "feel" and design.

BMW and M-B had the same postwar strategy as Alfa and Lancia: build more
cars at a cheaper price to make money. As you point out, BMW was
going nowhere very fast from the '50s right into the '70s. However,
better quality combined with superb big-budget marketing allowed both
BMW and M-B to succeed where Alfa and Lancia failed.

GM will help FIAT as much as it can but it isn't about to buy Alfa and
then find, like Ford with Jaguar and BMW with Austin Rover, that it has
only bought the right to spend $billions more and divert some of its
best
people to cleaning up the mess. The deal is an insurance policy: if it
works then GM happily takes Alfa; if it fails, GM still has 20% of FIAT
which today is a better balanced risk than 100% of Alfa and, anyway,
was paid for with stock. For FIAT it was the chance of a reasonable sale
price plus an opportunity to learn from GM. My reading is that Lancia is
now being given its last chance and will be shut down if it doesn't
start
making money. ALFA has about 5 years until the GM option expires and, if
it
doesn't make money by then, FIAT will likely be unable to afford to do
anything else than shut it down too.

The challenge for GM & FIAT now is not to produce another BMW at all but
something which will eat BMW's (and the Japanese's) lunch. To do that,
that
soemthing will need to be in the same class but different enough to
excite
customers. Otherwise Alfa will be back to competing on price - "the poor
man's BMW" - and, Leo, you still won't want one.

Nicky

--
to be removed from alfa, see /bin/digest-subs.cgi
or email "unsubscribe alfa" to majordomo@domain.elided