Alfa Romeo and Lancia vulnerable: "the next CEO of Stellantis must be ready to take strong decisions".

John Elkann, President of Stellantis. Photo Italpassion

The search for a new general manager for Stellantis is much more than just a leadership transition, it could redefine the future of some of the Group's brands, including premium brands Alfa Romeo, DS and Lancia. While John Elkann, Chairman of Stellantis, is in discussions with candidates for this key position, many shareholders expect the future CEO to be able to determine which brands from Stellantis' extensive portfolio of 14 brands will be viable in the long term.

Stellantis, born of the merger of Fiat-Chrysler and PSA in 2021, has the largest portfolio of brands in the global automotive sector. However, this diversity raises a dilemma. While brands such as Jeep, Ram and Peugeot are well established, others, particularly in the premium segment, are struggling to stand out. Alfa Romeo, DS and Lancia are among the most vulnerable brands, particularly on the European market, where they hold derisory market shares. In 2024, Alfa Romeo and Lancia together accounted for just 0.6 % of the European market, a far cry from giants like Audi, Mercedes or BMW.

Advertising

Portfolio rationalization, as suggested by several analysts, is becoming an increasingly plausible option for simplifying Stellantis' operations. According to experts at Oliver Wyman, the Group's premium brands could be particularly exposed. Alfa Romeo, with models such as the Stelvio and Giulia, DS and Lancia, risk becoming niche brands. The heritage and strong identities of these brands are undeniable, but their current performance is no longer sufficient to guarantee their future.

Alfa Romeo: a niche brand

For Alfa RomeoYear after year, the brand has become a niche player. Despite the Tonale, a compact SUV designed to boost sales, launched in 2022, followed by a Junior in 2024, sales have plateaued at just over 60,000 units. A figure that declines year after year. The goal of selling more than 100,000 units a year seems remote.

Advertising
Alfa Romeo sales figures since 2010

The Junior finally gets off to a good start but it remains specific to the European market. Tonale sales are running out of steam (an update is scheduled for mid-2025), and the Stelvio and Giulia will be replaced in the short term by 100 % electric models, pending hybrid versions, which cannot guarantee their success.

Lancia: a difficult renaissance

Lanciawhich has long been the pride of the Italian automotive industry, faces similar challenges. The brand, which has never regained its former glory, remains a shadow of its former self. For years, it survived on a single model marketed mainly in Italy. With just 0.3 % market share in Europe, Lancia is struggling to make a place for itself in the face of fierce premium competition. However, interesting projects are underway. After the Ypsilon in 2024, Lancia plans to unveil a Ypsilon HF in 2025, followed by the Gamma in 2026, a key model that could restore the brand's lustre.

Advertising
Lancia Ypsilon HF

Yet even with these launches, Lancia's future remains uncertain. The challenge is immense, and Lancia risks becoming a symbol of the past, confined to very limited segments.

The future CEO's dilemma

John Elkann, President of Stellantis

John Elkann, President of Stellantis, is attached to Italian brands. And yet, for shareholders, the next CEO of Stellantis will have to make some tough decisions to ensure the Group's long-term future. A source privy to John Elkann's thinking told Reuters that any candidate for Stellantis CEO without a brand vision would not be "the right choice".

Advertising

The challenge is how to balance the rationalization of the portfolio while preserving brands that still have development potential. The future CEO will also have to address the transition to electrification. and how to reposition these brands to meet the requirements of each market.

27 Comments

Leave a Reply
  1. You can't simultaneously position Lancia as a premium brand (after years of low-cost), release a magnificent concept car and at the same time deny the brand specific investments to reflect this positioning (excluding marketing) and be surprised when the targeted clientele doesn't come back right away. The judgment on Lancia's potential is therefore unfair. The brand needs a flagship (including a niche one - it's important to make people want to see it, and in this case to offer the concept almost as it is to a few collectors, like the 500e and the Alfa Stradale 33), time, products in line with the slogan ("Pure"-"radical", which the new Spanish Ypsilon is not) would have been a good way to go. Making courageous decisions doesn't necessarily mean closing down brands; it can also mean explaining to shareholders that profit doesn't just fall from the sky and requires investment.

    • That last sentence sums up what I'm thinking.

      At some point, shareholders will have to stop wanting the maximum right away...

  2. Stellantis is a destroyer of Italian car brands. Lancia has been relaunched but its future is uncertain, DS is a useless brand, a fake premium that serves no purpose, and he dares to include Alfa Romeo in the list of vulnerable and uncertain brands, which is a disgrace.
    In recent years, Tavares has done everything he can to destroy anything that isn't original Peugeot.
    Who decided to create Stellantis?
    As for Johh Elkann, there's plenty to be disappointed about.

  3. If Elkann had done things right instead of leaving the group in the hands of a quality-killer for 4 years, under-investing in the Italian brands and failing to get DS off the ground for a decade, they wouldn't be where they are today... Just look at what the Koreans did with Genesis in the same time frame.

    The reality is that Elkann, Tavares at the time, Imparato and their shareholders want to sell at a premium while offering cars that are not as good as the competition, in order to make even more money. Like the decision to turn Alfa Romeo into an SUV brand: of course there's demand for a compact car, but an SUV is more profitable, so they're just doing it to the detriment of an identity that's being eroded further and further...

    If that's what it was all about, Agnelli should have agreed to sell Alfa Romeo to Volkswagen back then. It would have been a heartbreaker, but far less than this never-ending nightmare with PSA...

    FCA wasn't investing enough already, but under Stellantis it's been like a bummer, so who's surprised by these derisory sales?

    Sell Alfa Romeo to any group, and they'll make something better of it than these incompetent cheapskates...

  4. Il problema non sono i brand ma i modelli che non sono all'altezza. Lancia Y 23000 euro per un modello di segmento B è troppo. Si è passati da un modello che costava 15/17000 ed era un best seller del mercato italiano ad un modello che costa, come minimo, il 50% in più e non vende nulla. I motori non aiutano ma chi si compra un Pure TECH con tutti questi problemi e questi richiami. Alfa invece ha motori non adeguati ai modelli. Per la Junior mettere un motore francese e' da folli. Sarebbe da cacciarlo a calci solo per avrer pensato una cosa del genere pensa averla portata in produzione.

  5. Sometimes I wonder what kind of bubble some managers and/or shareholders are living in! Of course, planning and managing a heavy industry like the automotive sector is clearly no easy task... but in the case of Stellantis, how can you imagine that 3 brands like Alfa, Lancia and DSx can develop when they already have almost no customers, when the products are similar and often disconnected from the market (DS8?).

    • If Alfa Romeo sells powertrains and Lancia tractions, they are not the same products. Lancia is also supposed to offer GTs and other premium sedans - and SUVs - while Alfa has a sportier positioning. DS can't have a sporty positioning, it's all about comfort, and the DS 5 didn't stand a chance with its German-style suspension. In short, you need to understand the brands and differentiate them clearly.

  6. Good luck to the lucky one! 🙄
    Luca de Meo's name was bandied about for a while, but was finally dropped for various reasons.
    Today, Antonio Filosa, an Italian, is said to be in the running to succeed Tavares. An internal recruitment.
    To be continued...

  7. The answer is obvious. Lancia has been languishing for too long. DS is a creation from scratch. Only Alfa has a brand image that is still interesting, albeit in steep decline. Even on its own, Alfa can count on synergies with Jeep, Dodge and even Maserati to make its D and E segment projects profitable, and the European brands for the others.

    By reallocating the resources lost to DS and Lancia, it should be possible to offer a real range (3 SUVs and one or two crossovers with the current plans). At the very least, we'll also need a handsome sedan to enhance our sporty image, a compact car to increase volume, and possibly a coupé to assert our premium status.

  8. Ehrlich gesagt, gebe ich der Marke DS keine Zukunft.
    DS bleibt ein Modell von Citroen.
    Wer braucht ein Auto von DS mit frz. Designer Aus-
    Stattzugeben?

  9. Then it's easy to suggest that Abarth should once again become a sports label for Fiat models, that RAM and Dodge should be merged and that DS should once again become Citroën's premium division. That's already three brands down... But closing Lancia stores when you've just opened them wouldn't make any sense.

    • Unlike the RAM/Dodge and DS/Citroen pairs, an Abarth is never just a muscular version of a Fiat.
      Same body, same interior, so minimal investment. It costs nothing to keep this brand. It offers a premium image of certain Fiat models, almost free of charge.

    • The Ypsilon comes off the same production line as the 208 and Corsa, so it can't be that expensive to produce. It's sold at a slightly higher price than its siblings, but the difference is justified. So there's no point in abandoning it.

  10. The problem is that the group (Stellantis) wanted to create volume (which they didn't manage to do) with brands that fans dreamed of seeing come back as icons. Take Alfa, for example: the fan, the enthusiast, the Alfiste that I am, wants the exceptional, the top, etc... At the time they came out, there were ways (at lower cost) to compete with the Germans. ( I'm not talking about the QVs, which are extraordinary ) but in the group's bank, they could take the top-of-the-range diesel ( ex: Estrema that I had, to compete with the SQ5 Audi or other ), the Maserati V6 diesel, the Maserati V6 petrol in 350 or 430 hp. That's what Alfisti want, something that hums. I've been lucky enough to go to the USA 3 times, and you don't see them. European sedans and SUVs are BMW, Mercedes and Audi. BM is the mini 440i, Mercos the AMG and Audi the S or RS. What do you expect them to do with a 280 hp 2.0L 4-leg? In France, showrooms are non-existent (you'd think you were at Dacia) and after-sales service is at ...... Nothing works, even though they had the opportunity to do so. Marchionne had a better start. After twenty Alfa ( 156, GT, 147, Mito, 159, Giulia Lusso, Stelvio sport Edition, Giulia Estrema and Tonale PHEV Véloce , I think I'll take my leave with regret. My life expectancy isn't 200 years and I'm sick of waiting.

    • Ditto for me, as I told a Stellantis salesman (the guy comes from PSA but they put him in the little Alfa Romeo showroom): if I want to change my Giulietta and especially if I'm looking for a compact car with a bit more power, there's nothing on offer, and nothing to come either, apparently. I'm forced to look elsewhere...

  11. When I see how VAG manages its group, Stellantis has a lot to worry about. Lambo, which was in its death throes, has become more than profitable, Seat and Skoda, which were low-end brands, have become the group's flagships. The group has even created Cupra, which in just a few years has become a brand that young people love, etc...

    • Volkswagen has simply... invested.

      At Stellantis, managers and shareholders want money to fall from the sky: "Go ahead Jean-Philippe, take a Mokka, paint it red, put on telephone rims and it's creamy from 30K!

  12. Peugeot war einmal gut, aber seit letztens sind ihre Motoren nur noch Schrott z.b. Zahnriemenantrieb. VW CO. Piech wartete schon lange Zeit nach einer Gelegenheit Alfa Romeo zu übernehmen . Gott sei Dank hatte S.Maccione die Gefahr erkannt, sonst hätten die Alfa's die billigen Schalter und Armaturen vom Golf und Audi. AUDI hatte ja damals schon mal vorsichtshalber die halbe Designer Crew mit überhöhtem Gehalt abgeworben. Alfa Romeo wird wiederkommen es genügt Ihnen auch mit kleineren Stückzahlen zu überleben, das beweisen Sie ja schon seit längerer Zeit.

  13. There's a very big problem that we're only touching on at the margins, but which is nonetheless crucial.
    When will Alfa dealerships have an ounce of Premium to offer!?!!

    As a customer of theirs, and passionate about the brand, I'm appalled to see that the service is the same as at FIAT! Courtesy is non-existent, coffee is never offered (for an Italian brand, that's the last straw), there's no separation between the ALFA and FIAT areas, and it's the same for the workshop and spare parts... Even the signs for the different areas have a rainbow font and colors, kebab style. So imagine the average customer coming to Alfa to buy a Junior from Audi with a Q3. It's impossible for the customer to feel premiumized by his purchase! It's all very well to complain about Alfa's lack of sales, but there comes a time when you have to ask questions the right way round! And invest once and for all in showrooms, services, personnel... In short, what makes a Premium brand.
    Quite simply...

  14. The problem is that these brands all eat each other up... They want to be premium and offer more or less the same thing: all SUVs (with the Gamma coming soon) and very expensive... They're already niche brands... ideally, at least in the beginning, each one should have its own identity...
    This is just one example, but imagine Alfa with sporty coupes and convertibles, Lancia with chic, premium city and family cars, and DS with beautiful luxury SUVs. It's an idea, but for me it's important to target each brand rather than making SUVs everywhere with the same engines and platform and just a different design. And if it's come to that, it's clearly because there are too many brands within the group.

  15. There's already one brand whose uselessness is obvious: DS.
    Created out of nowhere, with no history (literally or figuratively), it's Stellantis' ball and chain. A plethora of models that have never succeeded commercially. When I think that in 2020 the Lancia Ypsilon (sold only in Italy) sold as much as the entire DS range on the European market!

    There's also too much overlap in LCVs. What is the Opel brand doing in commercial vehicles? Or even Peugeot?
    Only the Fiat and Citroen brands should be offered as LCVs, as it's more in keeping with their history.
    Another idea would be to offer only the RAM brand for LCVs, excluding all others.

  16. Alfa Romeo must become an Ultra Luxury brand.

    They should definitely stop mass production (whose figures have been catastrophic for the past 15 years) and concentrate on ultra-luxury cars like the Stradale 33 (2 million euros/unit....and all sold!).

    Alfa must continue to inspire by building works of art on the road...

    • The Alfa Romeo 33 Stradale is a sublime work of art, but who cares?
      33 people in the world who can afford to buy a car costing 1.5 or 2 million euros, so very few people.
      It's highly exclusive and won't be of interest to aficionados, who will have to be content with admiring it at car shows.
      Alfa Romeo is also about affordable cars.

  17. 私は日本人ですが、昔から欧州車は憧れの対象でした。特にイタリア車やフランス車は、デザインが洗練されており、外観を眺めているだけでも幸せな気分に浸れる素晴らしい存在でした。
    ただ、現在のイタリアやフランス車に以前のような輝きはあまり感じません。はっきり言ってドイツ車や日本車の影響を強く感じることが多く、独自性が薄らいでいます。ここで問題になっている、アルファ、ランチァ、DSは、デザインを全面的に見直し嘗ての輝きを取り戻して欲しいと思います。

Leave a Reply

Your email address will not be published. Required fields are marked *