Posted on Wednesday 5 March 2008
The spreading exchange rate differential between the strengthening euro and weakening U.S. dollar means importing European manufactured models to North America is now significantly more expensive than just a few years ago. Established import brands like Volkswagen and Audi are already finding it hard, so imagine the challenge Alfa Romeo has on its hands with trying to juggle launching the brand and dealing with unfavorable exchange rates.
Alfa Romeo plans to return to the U.S. sometime next year and to deal with the exchange rate issue officials are now considering building a plant in Mexico to supply vehicles to North America. Fiat boss Sergio Marchionne told Reuters that “it could be Mexico” during a recent interview, but Alfa CEO Luca De Meo quickly added that nothing had been confirmed.
The cost of setting up the new plant could be offset by the savings Alfa would make if it didn’t have to import cars but then there’s fears of quality control that also has to come into play. Alfa Romeo already suffers from a reputation of poor quality and reliability and sourcing cars from low-cost centers such as Mexico may not be the ideal solution for the Italian carmaker.
The car that will spearhead Alfa Romeo’s launch into the U.S. is the new 8C Competizione supercar and its Spider sibling, however, don’t expect cheaper versions of these to be built in Mexico.
Alfa Romeo 8C Competizione
i dont think its in the best interests of alfa to send over any other car than the 8C. they can ask what ever they want for it and it will sell. dont set up shop here, and dont try to sell cheaper cars here. its not going to work out. focus more on your core market. if you thinking of an american invasion, just reinvest that same capital into your existing operations.
Mexico? Really? What? Italian cars don’t have enough problems with electrical fires and general reliability issues?
I personally don’t fear the Mexican workers’ skills.
And please don’t forget the rest of the continent. Mexican cars can enter many Latin American markets with zero tariffs. The German trio would get seriously scared if Alfa manages to undercut their price tags by a fair amount.