+++ Reid Bigland is the man tasked with taking ALFA ROMEO from niche player to global premium brand. The renaissance began with Giulia and continued with the new Stelvio crossover, unveiled at the 2016 LA motor show. Here’s how he plans to finish the job. It’s his 6-point plan to make Alfa Romeo great again: 1) Consider everything, even if that means a range of Alfa SUVs: The Stelvio is Alfa’s first SUV: it will not be its last. “We’re on track to have 8 products out by 2022: that is our commitment to relaunching Alfa Romeo as a premium brand”, says Bigland. “And if the consumer’s preference continues to gravitate toward SUVs of all shapes and sizes, compact and full-size, then we need to reflect that in the future Alfa product portfolio. Same with Maserati – Levante is going to be close to 50% of Maserati’s volume in 2017. If you’d predicted that 10 years ago people would have said you’re crazy. But with Maserati and Alfa it’s important that we build SUVs that drive and perform like a saloon”. 2) Aim high: Porsche’s Macan is an immensely capable car, one that somehow silences the contradiction most assumed was intrinsic in the concept of a performance SUV. With the Stelvio, Bigland has unashamedly targeted the Porsche. “If we can achieve just some of the success the Macan we’ll be in a good place – it’s a phenomenal vehicle, and you see that in the consumer reaction to it”, he says. “The Stelvio project was begun 6-9 months after we started on the Giulia and the timing of its release is particularly good: the mid-size SUV market is really hot. One of the strongest is the Macan. And we’re offering 65 more horsepower and a driving experience that’s a cut above in terms of acceleration and on-track performance. It’s key that we deliver on the performance characteristics of an Alfa Romeo. The Stelvio Q goes 0-100 km/h in 3,9 seconds, which is unique in the SUV segment, and from our simulations we anticipate it being the fastest SUV in the world around the Nordschleife, just as the Giulia is the fastest saloon. That combination of art, technology and incredible differentiates us”. 3) Get the cars right, sales will take care of themselves: “We’re not looking to smash any sales records with Alfa Romeo or with Maserati”, says Bigland. “The success of Alfa Romeo will be measured on the extent to which we meet our key attributes: performance, state-of-the-art technology and the gorgeous Italian design. If we can do that then sales success ad profitability will take care of themselves. I’m not fixated on sales targets. “This is not a brand we can resurrect, certainly in the US, in 12 or 18 months. We must focus on the product.  With Levante we did that and sales last month were up 52% globally last month (October 2016). Sales figures for the Stelvio? I’m not going to make any predictions, especially for the QV version. Up there, the air gets a little thinner. Not everybody is going to be driving a 510 hp SUV. It’s not everyone’s cup of tea – though I happen to like it…”. 4) Let the brand guide the thinking: Bigland talks a lot about being true to the Alfa brand. While some would argue that the Stelvio is a pretty good example of not doing that, there’s logic in letting Alfa’s values steer the marque’s course through this transformative era. Take autonomous systems, something the Stelvio is conspicuously light on. “They’re the polar opposite of what Alfa Romeo stands for”, counters Bigland. “In an Alfa, the driver is an integral part of the vehicle, and wants to be an integral part of the vehicle. If there is a threat from the autonomous driving movement then I think brands like Alfa Romeo, Ferrari and Maserati are not threatened. People are buying those cars to drive them. The mass-market segments – cars concerned with getting somebody from A to B – those are the ones that will be most affected if by this disrupter. Alfa is insulated”. 5) Keep Alfa sacred: The all-new Giorgio platform underpinning the Giulia and Stelvio is, in Bigland’s words, something of ‘a gem’. But rather than immediately roll it out across FCA’s portfolio, he’s keen to keep Alfa Romeo separate and special. “When you look at the infotainment and navigation, it’s unique to Alfa – it was part of the skunkworks process and we didn’t want to bring mass-market technology into the next generation of Alfa Romeo”, explains Bigland. “Alfa Romeo is hived off in terms of technology, sharing more with Ferrari and Maserati. But there could be trickle-down to other FCA products. “The Giorgio platform is class-leading from a driving dynamics perspective, and a significant competitive advantage for Alfa Romeo, so it is going to be difficult to keep that unique to Alfa: that’s the balance we’ve got strike. We need to be true to the premium values we’re looking to establish. But I can see components of that platform going onto other FCA products, upstream or downstream – it could go both ways”. 6) Don’t worry about racing just yet, stay focused: Alfa has a glorious competition history: F1 dominance in the 1950s, endurance racing success in the 1970s and an almost constant presence in production-based race series with cars like the original Giulia, the 155 and the 156. But Bigland’s focus for now at least is on the road. “We have our Alfa logo on the Ferrari F1 car but that’s about as close as we get at the moment – we’re there in spirit, though I’m not sure how much luck we’re bringing them this year (the cloverleaf logo was first used by superstitious Alfa pilot Ugo Sivocci to bring good luck). Everyone is familiar with Alfa’s history and its racing success but right now let’s focus on getting the Giulia and the Stelvio launched around the world”. +++

+++ AUDI dealers in China have threatened to take action against an agreement that paves the way for the country’s largest auto maker to build and sell Audi vehicles there, fearing it would dilute already thinning profits as sales slow. If the German auto maker doesn’t call off its agreement to explore a tie-up with SAIC Motor, China’s largest auto maker by sales, the dealers said they would demand “tens of billions of yuan” in compensation for potential lost sales. They have also threatened to not accept new Audi vehicles from December, some of the dealers told. Representatives from 15 dealer groups, which have a combined 150 Audi dealerships, met with Audi’s top executives in China, dealers participating in the talks said. The talks didn’t yield any outcome, they said. Audi and SAIC signed a memorandum of understanding on potential cooperation earlier this month. SAIC is also a partner of General Motors. “We take the interests of our dealers very seriously and will continue to address these interests in direct and open talks with our network partners”, said Audi China spokesman Martin Kühl in an emailed statement. Currently, Audi makes and sells cars in China through a three-party joint venture with Volkswagen and FAW Group. Dealers say an additional joint venture would add more dealerships to a network already struggling with slower sales and sliding profits. “We firmly oppose Audi’s tie-up with SAIC because it will seriously hurt our interests”, said one of the Audi dealers. Audi now has about 460 dealerships in China, with a third having opened in the past 3 years, said its dealers. “Our profits have dropped significantly. I couldn’t imagine where we will go if the company adds another 200 dealers”, said another Audi dealer who participated in the talk. Chinese regulations require foreign auto companies to team up with domestic manufacturers to build cars. Some foreign companies have 2 car-making partners in the country to tap demand for owning a car in China. For example, Volkswagen counts both FAW and SAIC as partners, and Ford, Toyota, Nissan and Honda each have 2 Chinese partners. However, analysts say luxury nameplates like Audi are in a weaker position to follow suit due to lower sales volumes. “Although Audi has expanded very fast, its volumes are still small by mass-market brand standards”, said Yale Zhang, managing director of consulting firm Automotive Foresight in Shanghai. Setting up a second joint venture will likely seriously divert sales from the current dealers, he said. Friction between car manufacturers and dealers has risen sharply in recent years because of slowing sales and rising inventories. BMW last year agreed to lower sales targets and pay 5.1 billion yuan, or $740 million, in subsidies to resolve a dispute with dealers. Audi’s new agreement with Shanghai-based SAIC comes as its share of China’s luxury-car market is falling as competition grows. Audi, which arrived in China in the mid-1980s and quickly gained a reputation as the maker of limousines favored by government officials, has long been the best-selling premium-car brand there. Audi currently sells about 15% more cars annually in China than rival BMW Group, and nearly 30% more than Daimler AG’s Mercedes, according to data from these companies. However, the gap has been narrowed amid growing competition from BMW, Mercedes and new entrants such as General Motors’ Cadillac and Ford’s Lincoln models. +++

+++ Volkswagen of America has admitted to being “a little bit surprised” by how many owners of DIESEL cars affected by the 2.0 TDI defeat device scandal intend to have their cars fixed rather than ask the company to buy them back. As part of a resolution agreed with the US legislators and approved last month, Volkswagen of America is offering approximately 475,000 affected customers a raft of compensation options including vehicle buybacks, lease terminations, emissions modifications and cash payments. Owners are currently in process of submitting claims for their affected cars to Volkswagen. If all owners participate and choose either a buyback or lease termination, the cost of the resolution will set Volkswagen back more than 10 billion dollar. According to Volkswagen of America boss Hinrich J. Woebcken, it seems that many owners are content to keep their cars. Speaking at the Los Angeles motor show, he said: “We have just passed 370,000 customers registering for the process. Uploading of their documents is the next step, so it is a little bit early to make solid predictions on this. What I can tell you is that compared to our own projections and estimations we were a little bit surprised how many more decided to get a fix. So it is interesting, I would even like to say good, to see that people love their TDI and want to have it fixed and get it back home”. Woebcken wouldn’t reveal when Volkswagen of America expected to have a more definitive picture of owners’ choices. The manufacturer is obliged to remedy or buy back at least 85% of the affected vehicles and the 370,000 who have already responded represents almost 78%. “We are very optimistic that we will reach this target”, he said. “We nearly have everybody in already”. Vehicles affected by the 2.0 TDI scandal in North America are the Volkswagen Beetle (model years 2013-15); Golf (2010-15); Jetta (2009-15); Passat (2012-15) and Audi A3 (2010-13; 2015). The settlement applies only to owners in the US with cars fitted with 2.0-litre TDI engines. Volkswagen is still working on a resolution for affected 3.0-litre vehicles. +++

+++ More details of the facelifted FORD Mustang update have been revealed by an unnamed dealer on an online forum, adding further fuel to previous rumours that the Blue Oval’s pony car will feature a 10-speed automatic transmission. The anonymous source who claims to be a dealership staff member lists numerous options and colours that they claim will be made available in the updated model. Some of these include a 10-speed automatic transmission, a ‘dual exhaust’ (though it’s unknown whether this means a bi-modal system) along with a ‘GT performance package 2’, a Carbon Sport package and adaptive MagneRide dampers that were previously exclusive to the Shelby GT350 variant. Other changes include the deletion of the 3.7-litre V6 model that is available in overseas markets, while some new colours, Orange Fury and Royal Crimson, will be offered on regular Mustangs along with a new Lead Foot Gray available on the Shelby GT350. This comes after reports earlier this year and last year that indicated the current 6-speed auto will be replaced by a 10-speed shifter co-developed with arch-rival General Motors, with the new transmission having already debuted in several new models including the Camaro ZL1 and Ford F-150 Raptor. Heavily camouflaged pre-production prototypes for the updated Mustang have also been spied in recent months, though it isn’t clear if there are any major changes to the sheet metal. Expect minor revisions to the head- and tail-lights, possibly the front and rear bumpers as well. The current-generation Mustang has been a sales hit for Ford. It’s believed the facelifted 2018 Mustang will be revealed sometime next year (possibly at the Detroit motor show in January) before rolling out gradually across global markets during the second half of 2017. +++

+++ A quiet HONDA Jazz update has rolled onto the market, bringing what proposes to be an improvement to the small hatch’s infotainment system. In all versions of the Jazz offered for the 2015 and 2016 model years, buyers had been treated to a large 7.1-inch touchscreen display, boasting Bluetooth connectivity, two USB ports and an HDMI input. A bug-bear for some, however, is that the system’s ‘home’ button and volume controls were both touch-sensitive points on the unit’s outer frame, demanding a level of hand-control tricky to achieve while on the move. In an effort to address that issue, Honda has swapped in a new unit with physical ‘home’ and ‘back’ buttons in place of the touch-sensitive home button and volume slider – along with covered ports for aux, USB and HDMI. As before, volume can still be controlled from the physical controls on the left side of the steering wheel. However, that is now the only way to control volume, with no physical or on-screen controls available. No problem for drivers, but perhaps an irritation for passengers (Here is where one might argue that a passenger should not help themselves to a vehicle’s controls, but try that point on with your partner…). Along with this update, Honda says the 2017 model’s infotainment system – which now also features a smaller 6.1-inch display – is faster to respond to input and quicker to load functions. The CD player has also been deleted, as is proving to be the trend across the industry. It should also be noted that while the new Civic come packing Apple CarPlay and Android Auto connectivity, the Jazz remains bereft of either. No other changes to the Jazz range have been made, and pricing remains unchanged. +++

+++ Although a recent report suggested that MERCEDES won’t ditch its diesel powerplants anytime soon, there might be a different story regarding the U.S. market. The German car manufacturer is waiting on EPA certification on a limited number of diesel models, but in the wake of VW’s Dieselgate scandal the government agency imposed more rigorous testing procedures – resulting in various delays. Meanwhile, Matthias Lührs, vice president of sales and product management for Mercedes-Benz Cars, said the company is conducting market research on diesel demand: “We have to look at that and see whether it makes sense to offer diesels in the future. We have not come to a conclusion but we obviously always tend to develop cars and offer vehicles according to customers’ demands”. In other words, it’s possible that by the time Mercedes will receive EPA certification for its engines, the company could drop the diesel line-up from its US range, with Lührs calling a “theoretical option”, especially as he noted that demand for diesel cars in North America is low and following a downslope. However, the results from Mercedes’ research will only be available early next year. The company’s current priority is securing EPA certification for the GLS’ diesel version, which will be powered by a V6 unit. +++

+++ VOLKSWAGEN aims to raise the profitability of its core Volkswagen brand, which lags those of major rivals, to above 6 percent after 2025, Volkswagen brand chief Herbert Diess told a news conference. Diess was spelling out details of his plans after the group announced a compromise with labor unions that will allow it to cut 30,000 jobs at the Volkswagen brand by 2025 in exchange for a commitment to avoid forced redundancies. “We want to make Volkswagen future-proof”, said Diess, who needs to burnish his credentials as a cost-cutter as the company struggles to restore its reputation and make deep savings to pay for the costs of its emissions-cheating scandal. The operating profitability of the Volkswagen brand, which accounts for almost half of group vehicle sales, is expected to reach just 2 percent this year and 4 percent in 2020. That compares with European rival PSA (Peugeot, Citroen, DS) target of an operating margin of 6 percent in 2021. +++

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