Hello, Allpar Forums member or visitor! If you were a member, you would not see this ad!

Register or log in at the top right of the page...

  1. This site uses cookies. By continuing to use this site, you are agreeing to our use of cookies. Learn More.

AN: Alfa Romeo, Maserati production cut after China sales blow

Discussion in 'Fiat News & Rumors' started by aldo90731, Oct 18, 2017.

  1. aldo90731

    Level III Supporter

    Joined:
    Jul 6, 2010
    Messages:
    5,748
    Likes:
    9,228
    Marchionne's Alfa and Maserati global plans don't appear to be going as planned. Changes to China laws hit Alfa and Maserati production numbers.

    Autonews reports Alfa and Maserati sales had fallen by half even before the new rules. JATO speculates that FCA's sales targets may have been too high. However, this is a normal pattern of brands and products that launch with an over-emphasis on emotion (i.e., styling, performance, handling), without establishing the necessary rational foundation (i.e., quality, safety), required to help sustain consumer demand through the length of the product cycle.

    Alfa Romeo, Maserati production cut after China sales blow
     
    #1 aldo90731, Oct 18, 2017
    Last edited: Oct 18, 2017
    Erik Latranyi likes this.
  2. Lampredi

    Lampredi Active Member

    Joined:
    May 16, 2012
    Messages:
    949
    Likes:
    590
    Oh, well, as long as it's just the Chinese market. It's never a good idea to be too dependent on it in any case.
     
  3. AlfaCuda

    AlfaCuda Active Member

    Joined:
    May 18, 2012
    Messages:
    702
    Likes:
    601
    It's a bad hit. Even small volumes will count because the sales targets are small for both brands. Hence they drops would be a significant percentage of that and will definitely affect profit targets, investments and strategy. Looks like the Chinese will force FCA into a corner that would make local production the only option.
     
  4. jimboy

    jimboy Well-Known Member

    Joined:
    Dec 7, 2006
    Messages:
    911
    Likes:
    621
    Seriously? You don't think China was a large part of their sales targets/planning? Alfa was supposed to be selling 400,000 units a year by now, according to SM and friends. They haven't even made half their target. It's only real success has been Europe, so far, so "I guess as long as it's only the US market, it's never a good idea to be too dependant on it in any case"???
     
  5. KrisW

    KrisW Active Member

    Joined:
    Jan 8, 2015
    Messages:
    1,115
    Likes:
    1,896
    China was a big part of the sales projections, and these rules certainly will hurt those planned sales.

    However, this is a universal rule that will also hurt Alfa and Maserati's competitors, and those companies have longer presence in China, and will lose much more heavily..
     
    ScramFan likes this.
  6. Deckard_Cain

    Deckard_Cain Active Member

    Joined:
    Dec 20, 2016
    Messages:
    479
    Likes:
    747
    This will force them to shift plans for Alfa at least. They'll have to adjust the product plan to launch cars that are more suited for the european buyers (new Giulietta sooner probably).
    I don't know what this will mean for Maserati since they're in a niche that is too small.
     
  7. valiant67

    valiant67 Rich Corinthian Leather
    Level III Supporter

    Joined:
    Jan 7, 2003
    Messages:
    31,680
    Likes:
    10,956
    Are the other manufacturers having the issues FCA has? As I understand it, the problem is FCA is pushing stock to dealers? Are the other manufacturers using this type of system or something different that is not affected?

    I tried to search for this online but found no references other than to FCA.
     
  8. Lampredi

    Lampredi Active Member

    Joined:
    May 16, 2012
    Messages:
    949
    Likes:
    590
    Substituting "the Chinese market" with "the US market" in my statement makes little sense, as there are certain "peculiarities" about the Chinese market that makes it different from other markets (such as the US).
    ...and here's an indication of why that is.

    The question is how desperate FCA is to sell cars in China. In any case, FCA would be unwise to devise a strategy vulnerable to the whims of the Chinese government, so if that's what we're witnessing now, it means that the original strategy has been revealed to be flawed, which provides an excellent occasion to revise the strategy.
     
  9. 77 Monaco Brougham

    77 Monaco Brougham Active Member

    Joined:
    Jan 15, 2017
    Messages:
    683
    Likes:
    985
    This looks like the Chinese government (as usual).....is flexing its considerable muscle.....to force any and all auto manufacturers to produce ALL models "in-country".

    I wish the company hadn't bet so heavily on China as part of its global strategy. Worst case scenario is that this could be the beginning of a "house of cards collapsing" outcome.
     
    Lampredi likes this.
  10. AlfaCuda

    AlfaCuda Active Member

    Joined:
    May 18, 2012
    Messages:
    702
    Likes:
    601
    When they are the largest auto market in the world and still one of the fastest growing economies in the world, I would say it would be foolish to miss out. Especially when your competitors are creaming profits over there.
     
  11. AlfaCuda

    AlfaCuda Active Member

    Joined:
    May 18, 2012
    Messages:
    702
    Likes:
    601
    When they are the largest auto market in the world and still one of the fastest growing economies in the world, I would say it would be foolish to miss out. Especially when your competitors are creaming profits over there.
     
  12. Lampredi

    Lampredi Active Member

    Joined:
    May 16, 2012
    Messages:
    949
    Likes:
    590
    If only things were that simple...
     
  13. jimboy

    jimboy Well-Known Member

    Joined:
    Dec 7, 2006
    Messages:
    911
    Likes:
    621
    And FCA had better get desperate to sell car over there, especially since everyone around her is predicting another slowdown/downturn in western economies, wouldn't you agree?
     
    AlfaCuda likes this.
  14. Lampredi

    Lampredi Active Member

    Joined:
    May 16, 2012
    Messages:
    949
    Likes:
    590
    Ummm... really? So where are all the foreign automakers who are forced to set up joint 50-50 ventures with US automakers, share their intellectual property (without any significant protection, I might add) and build their cars in the US in order to be allowed to sell their cars in the US market? And where are the 20+ % import tariffs on cars built outside the US?

    Heck, how big a percentage of the purported "domestic" US automakers' vehicles are actually made in the US, with US parts?

    No, sorry, the results are not strikingly similar at all. The US is gradually losing its auto manufacturing industry, whereas China has become the world's biggest producer of automobiles.
     
  15. jimboy

    jimboy Well-Known Member

    Joined:
    Dec 7, 2006
    Messages:
    911
    Likes:
    621
    How do you think all those foreign plants got built in the US? Because they all had extra money to spend? It was because the US threatened tariffs on foreign automakers UNLESS they manufactured IN THE US!
    I'm not sure of your age or nationality, (I presume Italian by your name), but if you had lived through the 1970's or 80's you would know that the US threatened huge tariffs on ALL foreign made vehicles in order to protect it's domestic market, that's why virtually every manufacturer that sells in the US has assembly plants there, even with the high costs associated with US manufacturing.
    You are making statements unsupported by fact or history vis a vis both China and the USA, especially when it come to nations who take steps to protect their own national interests, the US is more aggressive than most in that regard. And if you believe there is no industrial theft in non-communist counties, you are especially naive.
    Look at Italy for instance, and the trouble FIAT has had with it's own work/production force in trying to effect some worthwhile change to it's industrial landscape.
    Whether you, I, or anyone else approve of the way China does business, the FACT remains that it will soon be the LARGEST automotive player on the landscape by several percentages. So either the rest of the world learns to work with them, (a choice that must be made considering all the negative and positive factors), or you lose access to that market, period, a decision I don't believe FCA has any choice about.
     
    #15 jimboy, Oct 21, 2017
    Last edited by a moderator: Oct 21, 2017
    AlfaCuda likes this.
  16. Lampredi

    Lampredi Active Member

    Joined:
    May 16, 2012
    Messages:
    949
    Likes:
    590
    I was, for whatever reason, not paying attention to US auto manufacturing and import policies at the time in the 1970s and 80s, but I was unaware of any other tariffs being imposed on automobiles back then than the chicken tax (affecting light trucks) and the "voluntary export agreement" of 1981 affecting the number of Japanese cars that could be imported to the US.

    Specifically, what other tariffs were you thinking of from the 1970s and 80s?
    Seemingly not at present, at least not as far as the auto industry is concerned. To wit: The next Ford Focus will be imported to the US from China.
    What makes you think I would believe that?
    It's all about the terms on which one "learns to work with them". The current terms are mostly favourable to China, and that needs to change IMO, regardless of whatever water there may or may not be under the bridge (cf. the tu quoque "the US is just as bad" argument).
     
  17. Christopher

    Christopher Socially Unacceptable
    Staff Member Level III Supporter

    Joined:
    Jul 8, 2002
    Messages:
    5,044
    Likes:
    745
    This discussion is bordering on entering the political realm. Be careful that it does not.
     
  18. Lampredi

    Lampredi Active Member

    Joined:
    May 16, 2012
    Messages:
    949
    Likes:
    590
    I think you're right, so I'll refrain from making further posts in this thread.
     
  19. Bob Lincoln

    Bob Lincoln "CHECK FAULT CODES"
    Level 2 Supporter

    Joined:
    Jul 10, 2002
    Messages:
    29,875
    Likes:
    3,255
    You overlook the fact that prior to having plants in this country, Japanese cars were largely rustbuckets within 5 years. Recall that many Toyota "Corrodas" and Datsun B210s had flapping fenders within a few years due to severe rust. They were shipped here on a 4-week voyage across a salt ocean with no shrink wrap. Once they started making them here, that exposure and that problem disappeared. Not discounting your reasons, but they had a very strong motivation to eliminate the rust issues, and that was done in large part by eliminating the sea voyage.
     
    jimboy likes this.
  20. 77 Monaco Brougham

    77 Monaco Brougham Active Member

    Joined:
    Jan 15, 2017
    Messages:
    683
    Likes:
    985
    Speaking of rust......

    If I'm not mistaken, the former Chrysler Corporation in the late 1950's......in an effort to cut costs ....(what else is new?).....used recycled Japanese steel for the infamous 1957 "Suddenly It's 1960" cars.....a quality blunder some say the company never quite recovered from.
     
    #20 77 Monaco Brougham, Oct 22, 2017
    Last edited: Oct 22, 2017

Share This Page

Loading...