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Alfa Romeo & Lancia To Receive More Investment



Rueters Article

Alfa Romeo and Lancia are going to receive bigger investments as part of the Stellantis group, according to Chairman John Elkann.

During a TV interview with Italian state channel Rai, Elkann said that the two Italian brands will get greater opportunities under Stellantis than what was possible under Fiat Chrysler Automobiles.

When asked what role Turin, FCA’s hometown, would play in Stellantis, Elkann appeared adamant that being part of a bigger group is only good news for the Italian brands.

“We’ve seen it clearly with some brands like Alfa Romeo and Lancia, on which we could not invest or give resources as much as we wanted in recent years,” said Elkann, who was the chairman of FCA before the merger with PSA that formed Stellantis. “In this new group there will be much greater opportunities than in the past for these two brands, which are based in Turin.”

Stellantis has a total of 14 brands under its wings, making it the fourth-largest automaker in the world. The new group is going to pool brands like Alfa Romeo, Lancia, and DS, which will cooperate to grow their presence in the premium market.

Earlier this month, the group also confirmed that it’s ending plans to bring Peugeot to North America, saying that it will instead focus on existing brands in the region, including Alfa Romeo and Chrysler.

Related Topics: A Tale of Two Maserati's
Alfa Romeo To Shrink, Focus On Crossovers...
FCA Spending 1.1 Billion On New Fiat's and Alfa
 

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Yes, Lancia will sell DS in Italy. How unique will be the sheet metal is yet to be determined, but underneath expect extensive sharing. Interiors may be nearly identical.

Alfa and DS will divide the rest of EMEA between them with some overlap, more likely having unique sheet metal, but sharing powertrains and a great percentage of the interiors. Giulia/Stelvio will soldier forward with the new flavors, but if sales do not increase, expect those to be replaced as well.
 
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Yes, Lancia will sell DS in Italy. How unique will be the sheet metal is yet to be determined, but underneath expect extensive sharing. Interiors may be nearly identical.

Alfa and DS will divide the rest of EMEA between them with some overlap, more likely having unique sheet metal, but sharing powertrains and a great percentage of the interiors. Giulia/Stelvio will soldier forward with the new flavors, but if sales do not increase, expect those to be replaced as well.
Makes sense. Lancia still has name recognition in one or two countries. So Alfa Romeo will become a restyled DS... plus maybe Stelvio.

Giorgio’s success will likely be measured by its Jeep implementations. How's that for irony?
 

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I'm quite confident that we can imagine a mix of DS/Lancia.
Lower version on CMP and EMP2 platform, mainly made in France and finalized in Italy for Lancia and for the high-end, using the Giorgio platform and finalized in France for DS.
Now, how easily this can work, from an industrial/cultural point of view ?

But, my opinion (as someone from Europe) is that I'm not sure that there is a market for non-german premium brands.
The Guilia is an excellent car and sales are horrible, I can't really see what Stellantis can bring here.
 

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But, my opinion (as someone from Europe) is that I'm not sure that there is a market for non-german premium brands.
The Guilia is an excellent car and sales are horrible, I can't really see what Stellantis can bring here.
I think you may be right from a European standpoint. Outside of Europe, many luxury brands such as Lexus, Genesis, Lincoln, Cadillac, etc have been having growing success. But in Europe, it is purely German brands only. No one even comes close.

I worry that for many of us, nostalgia makes us elevate Lancia and Alfa, when really, maybe they shouldn't live up to their past and instead aim for something new.
 

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I suspect that the idea of having Alfa and Lancia competing with the German premium brands is at present a non starter. It is becoming evident that German car reliability and quality is not what it is peceived to be and that may be good for Stellantis in the long term. In the meantime, use Lancia as semi-premium like DS and aim Alfa purely at M series BMW, AMG Mercs and S type Audis utilising the economies of scale from platform sharing. Or, simply be revolutionary and reinvent both marques. Unlikely.
 

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Makes sense. Lancia still has name recognition in one or two countries. So Alfa Romeo will become a restyled DS... plus maybe Stelvio.

Giorgio’s success will likely be measured by its Jeep implementations. How's that for irony?
The company calls the architecture under the Grand Cherokee L as "all new". Which means it is not Giorgio.

Sure, lessons from Giorgio were used to make this "all new" architecture, but Goodyear uses lessons from the wooden wagon wheel when creating new tires.

The "all new" means an investment over the billions spent on Giorgio was required and very little of Giorgio was retained. So little that they are calling it "all new".

Giorgio will fade into the sunset having underpinned two great handling vehicles that were not a market success.

I truly hope for the Grand Cherokee and L's prosperity and every other vehicle on this "all new" architecture.
 
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I think you may be right from a European standpoint. Outside of Europe, many luxury brands such as Lexus, Genesis, Lincoln, Cadillac, etc have been having growing success. But in Europe, it is purely German brands only. No one even comes close.

I worry that for many of us, nostalgia makes us elevate Lancia and Alfa, when really, maybe they shouldn't live up to their past and instead aim for something new.
As you know, in the EU, the Germans own the fleet market.....companies leasing vehicles for employees.

Other brands have success because they do not directly go after BMW, Mercedes and Audi in this fleet market. Alfa tried and failed for various reasons. The only brand to make inroads against the Germans was Lexus....and Toyota is not interested in being the fleet vehicle in the EU.
 

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What i think is very encouraging is that Mr. Tavares has publicly stated that for instance buiding up DS to a World Class premium brand is a 30-year project.
Because Alfa Romeo allready has a serious history as a premium brand it might be able to get there a little faster than that but i would argue that this would at least be two generations of great product and 15 years of consistent development of the customer experience to get there for Alfa Romeo.
If you look at Audi for instance at least untill the early nineties they were not even close in perception to Mercedes and BMW. VAG has invested for twenty years to get anywhere close.
If you look at all the other players, Alfa Romeo, Volvo, Lancia, Jaguar, Infiniti, Lexus, Lincoln and Cadillac, in the past 40 years besides Audi only Lexus had the consistent investment for decades untill they reached a comparable level to Mercedes and BMW.
These brands have in common that their parent companies were very succesfull with mainstream brands and were able to take years of serious losses on their premium brand projects.
All the other ones had parents with serious financial issues along the way which resulted in inconsistent investment and ultimately never getting where they wanted to go.
I think GM and Hyundai right now have clearly been having a strong commitment to their premium brands and if they contiue to do so they will at least be succesfull in the US and China.

Stellantis finally gives Alfa Romeo (and hopefully DS and Lancia) a parent that should be financially sound enough to commit for a prolonged period of time to the development of their premium brands.
At least right now they seem to have a guy in charge that understands that this is not something done in 5 years.

Anyone who thought the Giulia and Stelvio could have done much better, in my opinion, was living in a fantasy world.
They had no immediate predeccesors, the 159 and 159 SW ended their life in 2012/2013. This was after their sales collapsed in the financial crisis. The did not sell or built them in significant numbers since 2010.
Giulia and Stelvio started their life not benefitting from an existing customer base. They had to win every sale from competing brands.
Further more they went from a pricing level competing with higher end VW's to pricing levels matching Audi and BMW (even though they gave additional value at the same price).
This was a very difficult starting place in a marketplace they at least had had a presence in the previous decades (Europe).
Their dealer network in Europe previously to the Giulia Launch was decimated. Their dealernetwork in the rest of the world was basically non-existent.

I think the good thing has been that the Giulia and Stelvio have been very competitive in the reviews with the premium German competitors. They are viewed as the benchmark as a driver's car in the premium midsize sedan and premium midsize SUV segment. In other areas they fall slightly short of the absolute best reviewed but they are at least competitive in the eyes of the professional reviewers. The issues they have are being adressed and for the next phase they should at least be a little bit better positioned with a little bit more of a dealer network with some existing customers and hopefully now a consistent level of additional models and replacement models that arrive regularly at those dealerships. I think it is a good thing they brought production levels down to match the lower sales and not choose to push more cars in to the market and destroy value for resale.

In my country, where the germans are king but Alfa Romeo has a certain popularity, i've looked at the used car prices. (In the late nineties and early 2000's Alfa Romeo as a brand was a permanent fixture in the Brand sales top 10 of my northern european country).
I've selected premium sedans from 2017/2018 with between 60000 and 100000 km with an automatic transmission.
Alfa Giulia: pricing from € 23495 up to € 38500 (all regular models with 4 cylinder engines, no Q's, 31 cars total)
Audi A4: pricing from € 21499 up to € 32949 (all regular models with 4 cylinder engines, 23 cars total. Besides the regular models there was one 6 cylinder diesel for € 33990 and one S4 for € 46440)
BMW 3 Series: pricing from € 18900 up to € 32950 (all regular models with 4 cylinder engines, 53 cars total. Besides the regular models there were 2 6 cylinder petrol for € 36900 and € 41895 and 3 M3's between € 60000 and €70000
Jaguar XE: pricing from € 20450 up to € 32900 (all regular models with 4 cylinder engines, 12 cars total)
Lexus IS: pricing from € 23900 up to € 33450 (all hybrids with 4 cylinder engines, 9 cars total)
Mercedes C-klasse: Pricing from € 23995 up to € 35999 (all regular models with 4 cylinder engines, 38 cars total. Besides the regular models there was one 6 cylinder petrol for € 36000 and 2 43 AMG's for € 42500 and € 44999 and 63 AMG's between € 59000 and €65000. Further more there were 3 C-klasse's available between € 12600 and € 19400 but they were outliers so i left them out)

As you see in my country at least the Giulia as an example retains it's value quite similarly as their premium competition if not a little better than some.
That would be another good starting point for the replacement coming next year.
 

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I agree.

It takes years to establish a premium brand. Those that scoff at DS do not understand that this is the long-game. They think overnight success is possible.....which is why Alfa failed.

Alfa does need more product and a commitment over the next decade before people start believing again.

But so do all the FCA brands. They need to show a commitment to quality, safety and reliability coming from friendly dealerships. That will not change in a year or two. That will take a decade.

I am happy to see Tavares look at the long-term in regards to branding instead of "the next merger" or the next quarterly financial report.
 

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The company calls the architecture under the Grand Cherokee L as "all new". Which means it is not Giorgio.
Which again shows that the FCA platform focus was impractical. They always ended up creating a new platform out of the old one. They would do better starting fresh each time and trying to share what they can share.

Quattroporte and Ghibli were based on LX platform, but deviated sharply from it (while still sharing some actual parts and assemblies).
Compass/Renegade/500X were based on Small platform, but deviated sharply from it.
Minivan was based on CUSW, but deviated sharply from it (while still sharing quite a bit of actual hard parts and assemblies).
CUSW was based on C-EVO, but deviated sharply from it.
Grand Commander was based on CUSW, but deviated sharply from it.

I wouldn't be too surprised if the Wagoneer made some serious changes to DT... but then, I wouldn't be surprised if it didn't... those Rams are pretty plush and ride nicely.

PS> Quality will be the making or breaking of the Wagoneer, long term, IMHO. If it succeeds, I think Renegade and Compass need to quietly vanish, or Compass needs to be substantially upgraded. Then having Chrysler versions would be handy.

PPS> I wonder about the viability if they did something like this in the USA:

CHEROKEE BASED
1) Jeep Cherokee: Trailhawk version only, best engine for off-road use only
2) Chrysler Saratoga (or whatever): FWD or AWD, choice of engines, luxury appointments, smooth ride, no off-road pretensions at all
3) Dodge Monaco (or whatever): sport-tuned AWD only, most powerful possible engine (e.g. 2.0 turbo hybrid), firm and sporty ride, no off-road pretensions at all

I think that's how Peugeot works in Europe, no? And it's how Chrysler used to work, only not quite as well differentiated, because they did it all with trim and sheet metal. I'm proposing the same basic platform and architecture and mostly the same parts, but tuned for brand strengths. There's some overlap but the Jeep is the only off-road-capable model, so the Saratoga and Monaco (names solely for illustration) would have different body panels and such to slash weight. No need for incredible torsional strength, it's not going off-road. Dodge is firm-riding and sporty in feel — tuning! springs, shift patterns, computer programming handles much of that. Chrysler is softer.... like Spirit R/T vs Acclaim.
 

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Which again shows that the FCA platform focus was impractical. They always ended up creating a new platform out of the old one. They would do better starting fresh each time and trying to share what they can share.

Quattroporte and Ghibli were based on LX platform, but deviated sharply from it (while still sharing some actual parts and assemblies).
Compass/Renegade/500X were based on Small platform, but deviated sharply from it.
Minivan was based on CUSW, but deviated sharply from it (while still sharing quite a bit of actual hard parts and assemblies).
CUSW was based on C-EVO, but deviated sharply from it.
Grand Commander was based on CUSW, but deviated sharply from it.

I wouldn't be too surprised if the Wagoneer made some serious changes to DT... but then, I wouldn't be surprised if it didn't... those Rams are pretty plush and ride nicely.

PS> Quality will be the making or breaking of the Wagoneer, long term, IMHO. If it succeeds, I think Renegade and Compass need to quietly vanish, or Compass needs to be substantially upgraded. Then having Chrysler versions would be handy.

PPS> I wonder about the viability if they did something like this in the USA:

CHEROKEE BASED
1) Jeep Cherokee: Trailhawk version only, best engine for off-road use only
2) Chrysler Saratoga (or whatever): FWD or AWD, choice of engines, luxury appointments, smooth ride, no off-road pretensions at all
3) Dodge Monaco (or whatever): sport-tuned AWD only, most powerful possible engine (e.g. 2.0 turbo hybrid), firm and sporty ride, no off-road pretensions at all

I think that's how Peugeot works in Europe, no? And it's how Chrysler used to work, only not quite as well differentiated, because they did it all with trim and sheet metal. I'm proposing the same basic platform and architecture and mostly the same parts, but tuned for brand strengths. There's some overlap but the Jeep is the only off-road-capable model, so the Saratoga and Monaco (names solely for illustration) would have different body panels and such to slash weight. No need for incredible torsional strength, it's not going off-road. Dodge is firm-riding and sporty in feel — tuning! springs, shift patterns, computer programming handles much of that. Chrysler is softer.... like Spirit R/T vs Acclaim.
I think your CHEROKEE BASED idea is exactly what is needed! Three models to cover the market instead of one with thousands of trims.

There is no performance trim of the Cherokee, which is based on a supposedly good handling Alfa platform! That is a waste, in my opinion. That performance trim should have been a Dodge. The Overland Trim should have been the Chrysler and the Trailhawk Trim should have been the only Jeep.

Belvidere would not be able to build enough of them.

But we will be getting this from Stellantis. It will take time (3-5 years) but I am confident that such can happen.

With the Bronco Sport beating the Compass Trailhawk, Stellantis needs to up its game and protect the Jeep brand.

It can be done.
 

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The Jeep Renegade and Compass are meant for non usa manufacture for sales targetting other 'very familiar with Jeep brand historically but no JEEP branded hitherto offered and if offered found to b junk' parts of the world. They are relative successes in europe, in latam, india+japan though less so in australia or china. As such it is important they be offered in the usa: as befitting the GLOBAL stature of the JEEP brand (inventor of the very genre suv and cuv....as of ww2 and following decade or 3!). All jeeps must b offered everywhere esp in their 'home' country: that adds to upwardly mobile AND authentic GLOBAL nature of the Jeep brand.

North American capacity dedicated increasingly to Jeep esp for new Wrangler and new gc, gc L, w and gw boosts the global aura of Jeep thereby ensurung assuredly increasing Jeep sales of all models globally into indefinite future (all else being equal)....autogenetic marketing as it were, and besides ensures sizeable export numbers made in us of a. It is so sad that America that used to export american branded cars and trucks in large numbers a few decades ago hardly does at all anymore: except for Jeep under fca/stellantis.

Allocating capacity to dodge and chrysler for desultory sales at low to negative margins with zero exportability to boot is, well...?!???

Maserati for a couple of years after the lx based new models was quite profitable because low but growing sales volumes but capable potentially of COMANDING high margins. Same is true for Guilia and Stelvio. Though new smaller Alfa s coming up would need lower cost via platitecture etc sharing with psa. Dodge and Chrysler need a much lower cost structure AND even then do not and cannot set their prices in the usa only marketplace (since there are no export volumes either.)
 

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The Jeep Renegade and Compass are meant for non usa manufacture for sales targetting other 'very familiar with Jeep brand historically but no JEEP branded hitherto offered and if offered found to b junk' parts of the world. They are relative successes in europe, in latam, india+japan though less so in australia or china. As such it is important they be offered in the usa: as befitting the GLOBAL stature of the JEEP brand (inventor of the very genre suv and cuv....as of ww2 and following decade or 3!). All jeeps must b offered everywhere esp in their 'home' country: that adds to upwardly mobile AND authentic GLOBAL nature of the Jeep brand.

North American capacity dedicated increasingly to Jeep esp for new Wrangler and new gc, gc L, w and gw boosts the global aura of Jeep thereby ensurung assuredly increasing Jeep sales of all models globally into indefinite future (all else being equal)....autogenetic marketing as it were, and besides ensures sizeable export numbers made in us of a. It is so sad that America that used to export american branded cars and trucks in large numbers a few decades ago hardly does at all anymore: except for Jeep under fca/stellantis.

Allocating capacity to dodge and chrysler for desultory sales at low to negative margins with zero exportability to boot is, well...?!???

Maserati for a couple of years after the lx based new models was quite profitable because low but growing sales volumes but capable potentially of COMANDING high margins. Same is true for Guilia and Stelvio. Though new smaller Alfa s coming up would need lower cost via platitecture etc sharing with psa. Dodge and Chrysler need a much lower cost structure AND even then do not and cannot set their prices in the usa only marketplace (since there are no export volumes either.)
This "hogwash" of the Renegade and Compass being necessary in the US falls apart with the Jeep Grand Commander. It became perfectly fine for the Jeep nameplate to mean different things in different markets.In fact, I believe that was in one of FCA's presentations (either directly or implied).

Dodge and Chrysler is only "negative" margin because that's how FCA treated them. Give them products not well suited for the marketplace and you end up with low margin vehicles.
But here's the problem. You give a potential car buyer nothing and they go to Toyota or Kia for that sedan. Then one of two bad things happen for FCA: 1) The buyer looks at the sedan and then a CUV. Most times, they won't run back to FCA. They buy the RAV4 instead (and boy are they buying the RAV4). 2) They go ahead and buy the Toyota or Kia sedan. They get a reliable vehicle. Their loyalty for their next, possibly more expensive vehicle is now with Toyota or Kia. Regaining that customer to a legacy FCA brands is now much harder.

There is absolutely no reason (other than the vehicles aren't as similar as we were led to believe) that a Dodge or Chrysler product could not have continued to make use of Belvidere's excess capacity.Cherokee NEVER met the capacity there, even with very strong incentives.

Much like Sergio, you are trying to define the US market without really understanding or experiencing it.
 

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Admittedly cherokee is a big failure, esp since large or at least significant export volumes to europe had been planned for it, since it was meant to also enable Jeep's reglobalization, given the high prices andor slight datedness of grand cherokee. But the pt holds: stellantis must prioritize Jeep models for usa capacity exRam, aiming to also export in sizeable volumes just as they will with new gc, gc l and somewhat also w/gw. It is a fool's errand to try and go head to head with the koreans and japanese in the commoditized sedan and cuv segments: they have much higher import content, persistent currency advantges...not that they've been making much money in these segments in usa lately!

So export volumes for nextgen cherokee are a must, and will boost further boost Jeep brand 'equity' globally? The Renegade Compass and Cherokee are de facto old pre fca segment entries/nameplates: there is no reason Jeep cannot out compete say the japanese cuv type vehicles: costs andor volumes have to kept in check: either through european or brazilian or mexican or indian manufacture andor....via exports outof us of a. American members of allpar do not appreciate the epic pure white space global potential of Jeep, including exports outof usa. Go for white spaces before u re dive back into usa only cut throat hyper commoditized segments. No?

Although hopefully Dodge has been repositioned through lots of expensive marketing to be a bit of a possible americana performance white space again?!
 

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Quoting this for emphasis:
"It is a fool's errand to try and go head to head with the koreans and japanese in the commoditized sedan and cuv segments: they have much higher import content, persistent currency advantges...not that they've been making much money in these segments in usa lately!"

You can't praise FCA for dropping sedans from the North American market this reason then praise FCA for offering uncompetitive small Jeeps in the North American CUV commodity market.
Plus there are HUGE opportunity costs to leaving commodity markets. Making yourself a niche manufacturer tends to results in having to further redefine yourself to smaller and smaller niches - and these niches are often more vulnerable than commodity markets in poor economic times.

"The Renegade Compass and Cherokee are de facto old pre fca segment entries/nameplates."

The names may have preexisted before FCA (thought Renegade was only a trim package) but the products are definitely FCA. I don't think I understand the point here. Keep in mind Cherokee was limited to the 3.2 engine because it was to be popular worldwide where the 3.6 was a hinderance. So FCA has already failed once (and again with the refresh) with Cherokee being a world product. We can't pretend any failures on these products lie before FCA.

Admittedly cherokee is a big failure, esp since large or at least significant export volumes to europe had been planned for it, since it was meant to also enable Jeep's reglobalization, given the high prices andor slight datedness of grand cherokee. But the pt holds: stellantis must prioritize Jeep models for usa capacity exRam, aiming to also export in sizeable volumes just as they will with new gc, gc l and somewhat also w/gw. It is a fool's errand to try and go head to head with the koreans and japanese in the commoditized sedan and cuv segments: they have much higher import content, persistent currency advantges...not that they've been making much money in these segments in usa lately!

So export volumes for nextgen cherokee are a must, and will boost further boost Jeep brand 'equity' globally? The Renegade Compass and Cherokee are de facto old pre fca segment entries/nameplates: there is no reason Jeep cannot out compete say the japanese cuv type vehicles: costs andor volumes have to kept in check: either through european or brazilian or mexican or indian manufacture andor....via exports outof us of a. American members of allpar do not appreciate the epic pure white space global potential of Jeep, including exports outof usa. Go for white spaces before u re dive back into usa only cut throat hyper commoditized segments. No?

Although hopefully Dodge has been repositioned through lots of expensive marketing to be a bit of a possible americana performance white space again?!
 

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You can't praise FCA for dropping sedans from the North American market this reason then praise FCA for offering uncompetitive small Jeeps in the North American CUV commodity market.
I think the sedans became a commodity a generation earlier than the crossovers. It will be very interesting to see where Jeep goes with the next generation Renegade/Compass/Cherokee, just as it will be where Ford goes with the Escape, which has been declining for years now. GM's small crossovers still seem to be doing well. From reading the Ford forums, it appears Ford will move the Escape/Edge/Explorer to EV's by the end of the decade and will soon discontinue the EcoSport in the U.S..
 

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I think the sedans became a commodity a generation earlier than the crossovers. It will be very interesting to see where Jeep goes with the next generation Renegade/Compass/Cherokee, just as it will be where Ford goes with the Escape, which has been declining for years now. GM's small crossovers still seem to be doing well. From reading the Ford forums, it appears Ford will move the Escape/Edge/Explorer to EV's by the end of the decade and will soon discontinue the EcoSport in the U.S..
Ford has also taken the Escape and developed a Bronco Sport and an upcoming small truck off it. That means Escape can be offered as a commodity vehicle, even at lower volumes one would suspect.
 
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