Can Alfa Romeo appeal to US 'graduates' once more?

The BBC's Michelle Fleury has a look around the Alfa Romeo 4C

On the floor of this year's New York International Auto Show, a curious thing happened.

The stand-out stars - sparkling Bugattis and sleek Maseratis - were completely ignored, as packs of journalists descended on a tiny booth that could barely fit two small cars.

It was like seeing the football star and head cheerleader sidelined on the dance floor at a prom, in favour of a member of the class of, well, 1992.

Alfa Romeo, Italian maker of the iconic Spider coupe immortalised by Dustin Hoffman in the classic 1967 film The Graduate, was making its return to US shores after a near 20-year absence.

Now controlled by Fiat Chrysler, the firm is planning on dipping its toe into the US market once more, with its two-seater 4C sports car - which has been available in Europe since earlier this year.

Sleek and low to the ground, Alfa Romeo's 4C is meant to compete against Porsche's Boxster and Audi's TT. With a mostly carbon fibre shell, it can go from zero to 60 miles per hour in just over four seconds.

Alfa Romeo car at NY Auto show Alfa Romeo's return to the US was a big draw at this year's NY Auto Show

But in a car show - and car market - already full with nostalgia, can Alfa Romeo's attempt to capitalise on its brand history work in the US?

Start Quote

It's difficult to call yourself a legitimate luxury brand and not be playing in the US market”

End Quote Bill Visnic Edmunds.com
Long time coming

Alfa Romeo left the US in the mid-1990s, after it struggled to compete with just a few luxury models in a market filled with big players that could offer a range of cars to consumers.

Owned by Fiat since 1986, its return to the US market has been discussed since 2000, but it is only under Fiat Chrysler chief executive Sergio Marchionne that those discussions gained real traction.

It's a return that some say the brand badly needs.

"Alfa needs to play here - they really need to expand their volumes and begin to payoff the product development that's come from Fiat," says senior analyst Bill Visnic, from automotive information site Edmunds.com.

"It's difficult to call yourself a legitimate luxury brand and not be playing in the US market."

Mr Visnic added that the merger between Fiat and Chrysler could benefit Alfa Romeo, because it gives the brand access to Fiat and Chrysler car dealerships throughout the US.

Start Quote

It's a car that attracts attention for the right reasons - it's subtle and unique”

End Quote Dino Pappous NY Alfa Romeo Owners Club
Muted launch

Yet despite the large degree of interest - both from analysts and fans of the brand who have been clamouring for a return - the launch here was decidedly low key.

Alfa Romeo only introduced one car - even though most industry watchers agree it will need more than one model to make an impact.

Jiyan Cadiz, a spokesperson for Alfa Romeo, told the BBC that only 500 4C Launch Edition cars would be available to buyers over the summer, priced at about $70,000 (£42,000). The company says it expects to sell just under a thousand regular 4C models, at a base price of $54,000, by the end of this year.

However, Mr Cadiz added: "We do have more products to come - know that we wouldn't start now unless we were truly ready."

All in the Alfamiglia

Many would-be buyers are desperate to find out more.

4c car at ny auto show The 4C will be available by the fall of 2014 in the US market

Dino Pappous is the president of the New York chapter of Alfa Romeo owners in the US. He owns two Alfas and loves the brand so much that he's busy organising the 2015 gathering of US Alfa owners (dubbed "Alfamiglia Nord Est").

"It's a car that attracts attention for the right reasons - it's subtle and unique - I would never buy a Porsche because it's like you're following the herd," he says.

He says he'd like to buy another Alfa - if he knew where to get one.

"It's not well advertised where to go to put a deposit or even where they are being sold," he says, adding that lack of customer service conjured up memories from Alfa's earlier US incarnation.

"Their commitment from a customer service level was brutal [in the 1990s] - if they don't get it right this time they're going to have a bad outcome again," he says.

Dino Pappous in front of Alfa Romeo car Dino Pappous is the president of the New York chapter of the Alfa Romeo owners club
Nostalgia saturation

Alfa Romeo faces another challenge too.

While the rebounding US economy has made it more attractive for brands like Alfa to re-enter the US market, it also has lured big players to once again invest in burnishing their so-called "halo cars", meant to build a brand following.

Ford celebrated the 50th anniversary of the release of its iconic Mustang "pony" car by re-creating a stunt it pulled in 1964 - putting it on the top of New York's Empire State building - and releasing 1,964 limited edition models.

Even Mazda, not a brand known for its long US lineage, got in on the nostalgia game by celebrating the 25th anniversary of its tiny MX-5 Miata convertible.

"It does seem like this year in particular it's a little heavy on heritage," said Mr Visnic.

Mustang on roof of Empire State Building The theme of this NY auto show was nostalgia, with heritage cars like Ford's Mustang

But, he adds, there's a reason for that: "People know what a Mustang is - you can't buy that [brand recognition]," he says.

"It's what all car companies hope to establish but for the vast majority of products, it never really quite happens - nothing gets legendary anymore, so when you do catch the lightning in a bottle it means a lot to a brand."

But lightning rarely strikes the same place twice.

Alfa Romeo hopes to be the exception.

More on This Story

Global Car Industry

The BBC is not responsible for the content of external Internet sites

More Business stories

RSS

BBC Business Live

  1.  
    GOOGLE ROW 08:05: BBC Radio 4
    The Google logo

    Is Rupert Murdoch's accusation that Google is a "platform for piracy" timed to coincide with an European investigation into the search engine giant? Rory Cellan-Jones tells the Today programme big media owners such as Mr Murdoch may "sense an opportunity" to cause mischief after the European Commission, which had concluded its investigation into Google, reopened it under pressure from Germany and France.

     
  2.  
    BRIT IN BRUSSELS 07:55: BBC Radio 4

    "There is a real sense of scepticism," over the appointment of Lord Hill as the European Commissioner in charge of Financial Services across the European Union, BBC European correspondent Chris Morris tells the Today programme. Green MEP Philippe Lamberts tells the BBC: "When I first heard about this I thought it was a joke". He thinks Lord Hill will face a difficult confirmation hearing on 1 October. Lord Hill needs to prove he is "not just the personal envoy of David Cameron", another MEP tells the BBC.

     
  3.  
    PHONES 4U RESCUE 07:44: BBC Radio 4

    Bondholders of Phones 4U are offering to take losses on their debt, in return for saving the firm. To do that they will have to negotiate with the suppliers of network services like EE and Vodafone. This "calls the bluff of the networks" says BBC Business Editor Kamal Ahmed. It will test whether the networks really want to sell through independent retailers like Phones 4U, Kamal says.

     
  4.  
    EASYJET DIVIDEND 07:32:
    Easyjet

    Easyjet is raising its dividend from a third of profit to 40% of profit for its financial year, which runs to the end of September this year. It has also confirmed an option to buy 27 of the Airbus A320 aircraft. It expects to take delivery of the jets between 2015 and 2018.

     
  5.  
    Via Twitter Adam Parsons Business Correspondent

    tweets: "French Connection shares were 335p a decade ago. Now 70p"

     
  6.  
    FRENCH CONNECTION 07:21:
    A French Connection store front

    French Connection has reported a half year pre-tax loss of £3.9m, compared with a pre-tax loss of £6.1m for the same period a year earlier. Revenue for the period was £84m, down from £89m a year earlier. The company says it is remains "cautious" about the second half of the year and reminds investors it is "dependent" on the Christmas trading period.

     
  7.  
    ALIBABA SHARE SALE 07:09: BBC Radio 4

    Alibaba prices its shares after the close of trading in the US later today. Steven Hartley practice leader at Ovum Telecoms tells the Today programme the tech firm has about 80% of the e-commerce retail market in China. But he adds "only about half of the Chinese population has access to the internet" so the potential of a company with this kind of hold on the Chinese market is huge and that's why it is attracting so much investor attention.

     
  8.  
    'HAIRY HIPSTERS' 06:58:
    Hipster olympics Berlin

    Wake Up to Money speaks to some "hairy hipsters" in London's trendy Shoreditch. One claims to spend "as little as possible" on grooming. Martin Wood, from IRI says there has been a decline in the sales of razor blades. Those who do shave are doing it less frequently, perhaps because they work from home and the expense is an issue too, Mr Wood says.

     
  9.  
    END OF QE 06:52: BBC Radio 4

    Andrew Wilson of Goldman Sachs Asset Management tells the Today programme Wednesdays US Federal Reserve announcement on interest rates was "largely as expected". It reiterated that it will raise interest rates once a "considerable time" has passed after its stimulus programme ends in October. "Essentially it looks like 1.5% interest rates by the end of next year," he says.

     
  10.  
    ALIBABA SHARE SALE 06:30: Radio 5 live

    "You are getting a taste of the future," says Gordon Barber, from the centre for digital business at the University of Salford on Wake Up to Money. He browses the Alibaba website in his spare time. He says it can give an insight into where high street technology products will be in one or two years time.

     
  11.  
    ALIBABA SHARE SALE 06:16: Radio 5 live

    "Investors are punch drunk with new issues," says Justin Urquhart Stewart, co-founder and senior partner of Seven Investment Management on Wake Up to Money. He says that recent shares sales have been "overpriced" and "oversold". He adds investors want to wait until shares settle down before investing in firms like Alibaba.

     
  12.  
    ALIBABA SHARE SALE 06:10: Radio 5 live
    Alibaba HQ

    The BBC's Ali Moore in Singapore explains the extent of Alibaba on Wake Up to Money. It owns China's biggest online shopping site. It has an online payment system. It owns 35% of a department store chain and it wants a banking licence. But she says the firm does not face massive competition in its home market, so it's not clear how it will do outside China. Its shares are expected to be priced after the US markets close on Thursday.

     
  13.  
    PHONES 4U RESCUE 06:02: Radio 5 live
    Phones 4U store

    Bondholders "were extremely angry over what happened," says Justin Urquhart Stewart, co-founder of Seven Investment Management Wake Up to Money. He's referring to the collapse of Phones 4U. Its private equity owners took more than £200m out of the firm by loading it with debt. Now those holders of debt are offering to take a loss to keep the business going.

     
  14.  
    06:01: Matthew West Business Reporter

    Morning folks. As always feel free to get in touch either on email bizlivepage@bbc.co.uk or on twitter @bbcbusiness.

     
  15.  
    06:00: Ben Morris Business Reporter

    A group of Phones 4U creditors are offering a deal to help revive the firm, and find out why you should care about Alibaba. Stay with the Business live page.

     

Features

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.