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Last Updated: Monday, 8 March, 2004, 06:29 GMT
Fiat Auto's delicate recovery
By Jorn Madslien
BBC News Online business reporter at the Geneva Motor Show

Lancia Musa
A car for trendy fathers to bundle bambinos into?

The launch of Alfa Romeo's Crosswagon marked the start of a high visibility strategy that will involve a string of new models from this sporty Italian over the next few years.

The car makes it clear that Alfa is gunning for the upmarket sports utility vehicle segment which traditionally has been dominated by butch Americans, Brits and Germans.

Its approach, though, is different.

During the launch, Alfa executive and engineer Paolo Massai insisted that the Crosswagon was "beautiful and delicate on the outside", leaving the impression that it would be devilish in bed with its "perfect balance between oversteering and understeering".

Executive challenge

It is a performance the new chief executive of Alfa's parent company Fiat Auto, Herbert Demel, must seek to match as he walks the tightrope towards what has to be a profitable future.

Paolo Massai launches the Alfa Romeo Crosswagon
Mr Massai: A bespoke chap surrounded by scantily clad women?

Or else.

Fiat needs sorting out, and fast, having seen a sharp fall in customer loyalty in its key home market.

And it is not only the Italians who are deserting Fiat, Lancia and Alfa Romeo.

Across Europe, the company's market share has been on the slide for years.

Last year alone, sales fell almost 9% from the previous year which had also been very disappointing.

Action

It would be extreme to suggest that Italy's entire automotive industry is on the line, though clearly there is more at stake than Mr Demel's career.

Fiat Trepiuno
Fiat Trepiuno: Art on wheels?

Mr Demel was not even the first choice for the job.

Mr Demel replaced Giancarlo Boschetti in the top job after former Ford executive Martin Leach was prevented from doing so due to an anti competition clause in his contract with the US car maker.

But he quickly went to work, reining in Fiat's European operations and ditching a string of national executives in the process.

Germany and France were the first to feel the pinch, with Spain and the UK expected to be next on his list as Mr Demel tightened the grip.

And judging by some of the latest models from Fiat Auto, it seems he is being effective on the car front too.

Sex appeal

Take Fiat's retro styled Trepiuno concept car which lovingly recreates the image of the 500 bubble car.

Herbert Demel
Mr Demel: Cautiously optimistic

This is art on wheels that brings high hopes for the car maker's future.

And then there is Lancia's new Musa people carrier which with its elegance should go a long way to win back the hearts and minds of the Italian people.

Lancia is aiming for 30,000 sales per year as it targets the high-end MPV market that has been carved out by German car makers, according to managing director Fabrizio Longo.

And it might just work, given that Musa's flamboyance should appeal to Italian men in tailored suits who youthfully sport slightly long hair.

Never before has it been this trendy to be a middle aged father with bundles of bambinos in the back of a small bus.

It seems even the comment made by Miss Switzerland 2003, Bianca Sissing - who had been hired by Lancia to bring glamour to their marque - failed to dent their confidence. (She told journalists during press day that her favourite car was a Jaguar.)

Gloomy

But the confidence displayed by the executive posturing at the show - where bespoke chaps were surrounded by scantily clad, drowsy eyed women - is far from matched at corporate level.

A slew of new models should indeed bring about a rise in sales, though not a massive one, predicted a somewhat sombre Mr Demel.

Sales would rise "less than 10%" this year, Mr Demel said in an unusual display of modesty, and certainly not one that is expected at a show where everyone else are banging their drums as best as they can.

Surely, if you cannot sex up your message at a motor show, then when can you step up on the soap box?




SEE ALSO:
New Panda raises hopes at Fiat
11 Sep 03  |  Business
Fiat reveals record loss
28 Feb 03  |  Business


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