This week I was asked how Alfa Romeo could increase their sales in the UK, it seems despite now having the Giulia and recently launched Stelvio, the Italian car makers sales have taken a dip and are not on course to hit expected targets.
The simple answer to this was not difficult to find, in fact Alfa Romeo has two problems in the UK.
First is it’s dealer network, it is quite frankly terrible. If you happen to live North of Birmingham, and people actually do (me included) finding an Alfa Romeo dealer is a bit like throwing a dart at a map. Sporadically positioned across the country might be a better way of putting it. In a word if you want to test drive an Alfa Romeo, the latest Stelvio for instance and I recommend you do, chances are you have to drive 45 minutes or more to find your nearest dealer. Why would I do that if I am looking for a new compact executive car, the likes of BMW, Mercedes and others are about 15 minutes away.
This is a big problem for Alfa Romeo, if you can’t get your product in front of people you can’t sell it, after all if I produced the finest single malt whiskey in the world but you had to come to my house to buy it because it wasn’t available at the local supermarket then how many am I going to sell, not very many! You go down to your local motor retail park in the UK and you have a raft of car dealers, Audi, BMW, Mercedes and others all within walking distance, because people are lazy, the convenience of these dealers in close proximity to each other means people will buy from them rather than drive further a field for a product they are not even sure of. What makes it worse is that these places often have a Fiat dealer, therefore sensible strategy should be that somewhere on that Fiat site should be Alfa Romeo.
Secondly Alfa Romeo has a loyalty problem, I am not referring to Alfa enthusiasts but people who buy cars on PCP, PCH, Business etc. Alfa Romeo has not had the product availability to build up product loyalty in the UK. AS I mentioned before, people are lazy and also want convenience, many people if they have been driving a particular car and it has been good for them will often stick with that brand when changing again. Why wouldn’t they? It has been reliable with no real issues, chances are they have got to know their local dealer through having it serviced and as long as that experience is also good then they pop along there next time they are changing their car.
Alfa Romeo doesn’t have this luxury because they have not had consistent products, with a gap in between the 159 and Giulia for example, anybody who might have owned a 159 when the time came to change their car, the chances are they have gone to another brand as Alfa did not offer a replacement model for sometime prior to the Giulia. Most company car owners who run say an Audi, will stay loyal to that brand, pending any car issues, when it’s time to change their company car, partly because of the convenience and partly because they know what they are buying into. Alfa Romeo does not have this yet, and getting this will not happen until the Giulia is into it’s third or fourth generation, when the product has proved to be good and people have owned one and when it’s time to change a newer version is available.
FCA must understand that bringing Alfa Romeo back into the mainstream as a premium brand will take time to establish itself and if it wants the product on the market today with a financial return today it will not get that. It took the likes of Audi 25 years to become the premium brand it is seen as today, FCA must accept this will be the case with Alfa Romeo and during that period it must invest in new products continually, not bring out a new car then no replacement for 8 years or indeed cease production then wait a few years until the next one arrives. If it wants to beat the Germans in the market, and they do after all set the precedence, then they must use their business plan as an example. This also means that strong investment in a new dealer network, if people can drive an Alfa Romeo you have every opportunity of moving them away from their existing car brand.
What are your thoughts on Alfa Romeos growth in the UK?