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China-FCA merger could be a win-win for everyone but politicians

NEW YORK — Fiat Chrysler boss Sergio Marchionne has said the car industry needs to come together, cut costs and stop incinerating capital. So far, his words have mostly fallen on deaf ears among competitors in Europe and North America. But it appears Marchionne has finally found a receptive audience — in China. FCA shares soared Monday after trade publication Automotive News reported the $18 billion Italian-American conglomerate controlled by the Agnelli family rebuffed a takeover from an unidentified carmaker from the Chinese mainland. As ugly as the politics of such a combination may appear at first blush, a transaction could stack up industrially, and perhaps even financially. A Sino-U.S.-European merger would create the first truly global auto group. That could push consolidation to the next level elsewhere. Moreover, China is the world's top market for the SUVs that Jeep effectively invented, so it might benefit FCA financially. A combo would certainly help upgrade the domestic manufacturer; Chinese carmakers have gotten better at making cars, but struggle to build global brands, and they need to develop export markets. Though frivolous overseas shopping excursions by Chinese enterprises are being reined in by Beijing, acquisitions that support the modernization and transformation of strategic industries still receive support, and the government considers the automotive industry to be strategic. A purchase of FCA by Guangzhou Automobile, Great Wall or Dongfeng Motors would probably get the same stamp of approval ChemChina was given for its $43 billion takeover of Syngenta. What's standing in the way? Apart from price (Automotive News said FCA's board deemed the offer insufficient) there's the not-insignificant matter of politics. Even as FCA shares soared, President Donald Trump interrupted his vacation to instruct the U.S. Trade Representative to look into whether to investigate China's trade policies on intellectual property. Seeing storied Detroit brands like Jeep, Chrysler, Ram and Dodge handed off to a Chinese company would provoke howls among Trump's economic-nationalist supporters. It might not play well in Italy, either, to see Alfa Romeo and Maserati answering to Wuhan instead of Turin — though Automotive News said they might be spun off separately. Yet, as Morgan Stanley observes, "cars don't ship across oceans easily," and political considerations increasingly demand local manufacture of valuable products.

Alfa Romeo C43 is ready for the 2023 Formula One season

Following rival Red Bull's lead, Alfa Romeo has become the second team to unveil the car it will race in the 2023 season of Formula One. (Haas has revealed its livery, but so far not the new season's car.) Called C43, the single-seater Alfa stands out from its predecessor with a new aerodynamic profile and a redesigned livery, among other changes. The C43's red and black livery is the work of the Alfa Romeo Centro Stile, which is the same design center that draws the storied Italian company's road cars. Alfa Romeo describes the C43 as an evolution of the C42, its predecessor, and it notes that a technical team led by Jan Monchaux developed it around a new, Ferrari-sourced power unit. It features several updates and numerous new parts, though full details haven't been released, and Alfa Romeo hopes the changes made to the C43 will allow its team to improve during the 2023 season. "This car is an evolution of last year's, reflecting the new regulations and introducing major changes in the areas where we found improvements to be needed. I hope it's going to be quicker than the successful car we had last year, that's what matters most, and more reliable as well: We have put a lot of effort in this direction," said Monchaux, the technical director of Alfa Romeo's Formula One team. Alfa Romeo will begin testing the C43 in Barcelona, Spain, in February, and it will then send the car to Bahrain for more testing ahead of the 2023 F1 season's first race. Valtteri Bottas and Zhou Guanyu will drive for Alfa Romeo during the upcoming season. And while the odds of non-professional drivers taking the C43 for a spin are low, anyone with or without a license will be able to drive it in the F1 2022 video game.

Italy forces Alfa Romeo Milano name change — call it Junior now

The Alfa Romeo Milano is no more, and in its place lies the Alfa Romeo Junior. This tiny Alfa crossover – that wonÂ’t be sold in the U.S. – was only revealed just last week, but Alfa has already been forced to change the name at the request of the Italian government. WhyÂ’s Italy telling its beloved Alfa Romeo brand it canÂ’t use the “Milano” name? It comes down to where the car is being built, and the Milano/Junior will be built at AlfaÂ’s plant in Tychy, Poland. According to ItalyÂ’s Industry Minister, Adolfo Urso, “A car called Milano cannot be produced in Poland. This is against the law.” Said law aims to stop the sale of products that have Italian-sounding names but are not actually produced in Italy. "This law stipulates that you cannot give indications that mislead consumers,” Urso continued. “So a car called Milano must be produced in Italy. Otherwise, it gives a misleading indication which is not allowed under Italian law." Alfa Romeo sent out a press release today in response to the government criticism, agreeing to change the MilanoÂ’s name to Junior. That said, Alfa had plenty to say and still believes the Milano name to be a lawful one. “Despite Alfa Romeo believing that the name met all legal requirements and that there are issues much more important than the name of a new car, Alfa Romeo has decided to change it from “Milano” to “Alfa Romeo Junior” in the spirit of promoting mutual understanding,” the companyÂ’s statement reads. “The Alfa Romeo team would like to thank the public for the positive feedback, the Italian dealer network for their support, journalists for the enormous media attention given to the new car, and the government for the free publicity brought on by this debate." The name Milano was actually chosen through feedback from the public, as Alfa polled ItalyÂ’s citizens on what it believed the little SUV should be called. “Milano” was the winning name, and it makes a whole lot of sense considering AlfaÂ’s history began in Milan, Italy. Of course, “Junior” speaks to AlfaÂ’s history, as well, harkening back to 1966 with the Alfa Romeo GT 1300 Junior. Course, none of this has much of an impact for what weÂ’ll see on Alfa Romeo lots in the U.S., as the Junior wonÂ’t be sold here. ItÂ’s an entertaining turn of events, though, and if youÂ’re curious to read AlfaÂ’s response in its entirety, you can find it here.