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Old 09-15-2011, 12:42 PM   #1
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Post Frankfurt 2011: Alfa U.S. Return Delayed Again

For those of you looking forward to the impending return to the U.S. of Alfa Romeo, you may want to stop reading this now.

Due to the current debt crisis in Europe, it looks as though Alfa has decided to hold off on its return to the United States and has gone so far as to cancel a planned SUV build.

The story from AutoNews:

Originally Posted by Luca Ciferr & Bradford Wernle - Automotive News, 9/14/11

Alfa delays U.S. return again as European debt crisis deepens

FRANKFURT -- Alfa Romeo has delayed the U.S. introduction of several key models by at least another year and has cancelled plans to build a mid-sized SUV at Chrysler Group's factory in Toledo, Ohio.

Alfa Romeo CEO Harald Wester, in a presentation to financial analysts here today in connection with the Frankfurt auto show, said Alfa Romeo was scaling back its global expansion plans.

Wester's announcement marks the latest in a series of delays of the U.S. return of Alfa Romeo, the sporty brand of*Fiat S.p.A.*His remarks came one day after Fiat-Chrysler CEO Sergio Marchionne offered a gloomy assessment of Europe's debt crisis, saying the European common currency could come off the rails if political leaders don't resolve the lingering crisis soon.

Marchionne said the debt crisis has forced Fiat and Chrysler to examine the timing of new-vehicle introductions.

"We are reviewing volumes and the timing of new products to see when it is really necessary to launch them," Marchionne said.

In its global plan, unveiled in April 2010, Alfa Romeo planned to return to the United States in late 2012. Under the revised schedule, the first car won't come to the United States until mid-2013, when the 4C, a low-volume coupe arrives. The MiTo, a five-door hatchback, is scheduled to follow in the second half of 2013.

The Alfa Romeo brand is to be sold by a network of 130 Fiat dealerships, more than 100 of which are now open. The rest are to open by the end of this year.

Dealers must wait
Fiat dealers have pinned high hopes for Alfa, which would give them a range of larger, sporty vehicles to augment the Fiat 500 small car, the only model they currently are selling.

Those dealers now will have to get by with their Fiat models a while longer. The Alfa Romeo Giulietta, a compact hatchback, was scheduled to arrive in 2013 but now has been moved back to 2014. The crucial Giulia, a mid-sized sedan and wagon that were to have kicked off Alfa's return next year, will not arrive until 2014, under the current plan.

In the past 18 months Marchionne has rejected three rounds of styling proposals for the Giulia sedan and wagon, pushing its launch back.

At the end of July, Alfa had already postponed the two Giulia models until 2013.

Alfa also canceled plans for a mid-sized SUV, originally due in 2014. The vehicle was to have been built in Toledo on a shared platform with the Jeep Liberty. The new plan now calls for a large rear-drive sedan -- derived from the next generation of the Maserati Quattroporte -- to appear beyond 2014.

Subcompact first
In the revised plan, the five-door MiTo subcompact is the only Alfa model to keep the original timing for a 2013 launch.

The new delays led Alfa to trim its global 2014 target of 500,000 unit sales to just 400,000 units.

Alfa had been planning its return to the United States since it signed a strategic alliance with General Motors in March 2000. So the brand's return had been delayed for a decade -- so far. Alfa left the United States in 1995.

According to Wester's presentation, Alfa plans on selling about 155,000 units worldwide this year, compared with 115,000 it sold in both 2009 and 2010.
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This is an unfortunate bit of news coming from a proud company such as Alfa, though things are at least looking positive for them with their projected short-term sales estimates (even though long-term is being slimmed).

Hopefully when the dust settles on the current debt crisis, there will be a better idea on when a return the U.S will be appropriate.

I can't help but feel like the cancellations and postponed models is going to hurt interest in the future, however. I hope this is not the case, but with continued delays, interest may be dwindling with the thought of things never coming to fruition.

Still, when it comes to the current economic climate, doing things in haste is likely the last thing the company wants to do if they want to stay solvent.

We'll see how things go from here.

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