Might Alfa Romeo finally get a true savior in Carlos Tavares? Since 2014, the Portuguese executive has guided the nearly bankrupt PSA Group back into the black, and after taking over Opel/Vauxhall he quickly ended chronic losses at the former General Motors subsidiary.
If PSA and Fiat Chrysler Automobiles merge, Tavares would have the chance to attempt what might be his toughest turnaround yet.
The storied Italian sports car brand has humbled more than one powerful executive. Under former FCA CEO Sergio Marchionne, three attempts to put Alfa on the right track flopped. Mike Manley, who succeeded the late Marchionne in July 2018, needed fewer than 18 months to realize that Marchionne's final relaunch plan for Alfa was unachievable.
Manley showed this on October 31 when he announced Alfa Romeo would grow to four models by 2022 instead of expanding to seven vehicles by then, which is what was promised in the 2018 plan.
Alfa's current cars -- the Giulia midsize sedan, Stelvio midsize SUV and the Giulietta compact hatchback -- cover three different segments, but only one is an SUV and none of the models offers electrification.
By 2022, the four-car lineup is expected to include the Giulia, Stelvio, a new compact SUV and a new small SUV. Both of the new SUVs are expected to be electrified.
The first-generation Giulia and Stelvio have underperformed, resulting in Alfa Romeo's 42 percent sales decline through September in Europe, where the Italian marque has been passed by Tesla, Jaguar, Porsche and Lexus so far this year.
Alfa Romeo's deliveries were also down 27 percent in the U.S. These double-digit declines likely contributed to FCA's decision to scale back Alfa's product plans, a move that will also help the Italian-American automaker reduce capital spending.
Brands are safe
Alfa Romeo received a bit of good news last month when Tavares, the designated future CEO of the combined automakers, said no brand would be discontinued if the companies merge. The sobering reality is that even if the merger goes through, Alfa Romeo will have to compete with a small, aging product range for the next two to three years, likely resulting in a further deterioration of its market share.
Other positive notes for Alfa are that Tavares is a true "car guy" who races in his spare time and he successfully resurrected the Alpine low-volume performance brand while he was the No. 2 at Renault. He also could leverage PSA's platforms to strengthen Alfa Romeo's future lineup, ensuring a more regular stream of new products than it has had for the last 15 years.