Fiat Chrysler Automobiles’ Italian luxury brand won’t turn a profit in 2018. The news rebukes previous FCA guidance suggesting the brand would be profitable by now as is expands through its Giulia and Stelvio models.
“The losses are shrinking, but we need more volumes,” FCA CEO Sergio Marchionne stated during the company’s fourth-quarter earnings call, as reported by Automotive News. The executive declined to detailed Alfa’s financial position in detail, but blamed a lack of China sales as part of the brand’s primary problem.
FCA is no longer providing a timetable for Alfa Romeo profitability.
Mums likely the word because targets at Alfa have been routinely missed. Back in 2014 FCA executives forecasted sales volumes of 400,000 units per year for Alfa by this year with eight new models. Obviously those forecasts did not pan out, so FCA revised them in 2016 by cutting them in half.
As recent as last April FCA was saying Alfa would turn a profit by the end of 2017.
Analysts estimate Alfa sold about 118,000 vehicles globally in 2017, still short of the 200,000 in the revised forecast from 2016. The underperformance is in part caused from a slower rollout of the brand’s new models, including the fact they have only three models versus a planned eight.
Marchionne seems confident Alfa Romeo will ultimately churn out vehicles profitably, but it sounds like no one really wants to say when that will happen.