From Italy with luxe: Maserati tempts US drivers with new sedan
Home page > News

From Italy with luxe: Maserati tempts US drivers with new sedan

www.reuters.com   | 11.01.2013.

MILAN (Reuters) - When rap legend Eminem took a Chrysler sedan for a crawl through dark Detroit streets in a landmark 2011 TV commercial, the car he drove was defiantly "Imported from Detroit."
From Italy with luxe: Maserati tempts US drivers with new sedan

In 2013, with Chrysler back in the black, its Italian parent, Fiat SpA (FIA.MI), is trumpeting another new car - one that rockets from 0 to 60 miles per hour in under 5 seconds and is decidedly "Imported from Italy."

Fiat's luxury brand, Maserati, will unveil a newly redesigned Quattroporte sedan at the Detroit auto show, which begins on Sunday.

The contrast between the Quattroporte and Eminem's Chrysler sedan is apt. While it was U.S. factory workers who benefited from Chrysler's Fiat-led resurgence since 2009, this year it will be employees at Fiat's money-losing Italian plants watching to see if the Turin-made Maseratis will be able to increase the company's tiny U.S. market share.

To move into bigger volumes, Maserati must pry buyers away from German and British luxury competitors - a tough challenge given that many U.S. consumers have heard little about the brand in recent years.

Worldwide, Maserati wants to increase annual sales from about 5,000 cars at present to 50,000 in 2015 with the help of a smaller, less expensive "entry-level" Ghibli model due out later this year and the Levante SUV in 2014. The redesigned Quattroporte begins arriving at European dealers next month and in the United States in June.

Maserati has yet to announce a price tag for the Quattroporte in the U.S. market. In Europe, it will sell for between 100,000 and 150,000 euros. Maserati launched the original Quattroporte in Italy in 1963.

"Even if you take it as a given that the new car is a valid competitor for BMW (BMWG.DE) and Audi (VOWG_p.DE), it's not clear how Maserati plans to step up from 5,000 cars it sells now to the 50,000 they are targeting in 2015," said UBS analyst Philippe Houchois. "What's missing is an indication of their marketing and distribution strategy."

Fiat says it will increase Maserati dealerships worldwide to 425 by 2015 from 250 at the end of 2012.

Fiat is spending $1.6 billion between now and 2014 on product development and a new factory in Italy to build this hoped-for increase in sales for the three new models.

MASERATI A KEY PIECE

Building up Maserati volume is a key piece of Fiat's latest strategy to stem losses in Europe. With European car sales likely to shrink for a sixth year in a row in 2013, mass-market car makers have been cutting capacity, as did their U.S. counterparts back in 2009.

Rather than shut another factory, Fiat-Chrysler Chief Executive Sergio Marchionne's plan is to sell more Maserati, Alfa Romeo, Jeep and Fiat 500 cars in expanding markets such as the United States in order to return Fiat's money-losing operations to profit in Europe in 2015 and keep Italian workers in their jobs.

Marchionne's ambitious plan - which he admits is "not for the faint-hearted" - sent the stock tumbling after it was unveiled on October 30 on concerns about whether Fiat has the ability and sufficient cash to execute it.

Luxury brands are important to car makers because they are more profitable than mass-market ones. Fiat's Maserati and Ferrari brands combined sold about 10,000 cars globally in the first nine months of 2012, contributing 9.5 percent of Fiat's total earnings before interest and tax of 2.77 billion euros. Fiat said it earns a trading profit of 6.6 percent on each Maserati it sells, while it loses money on its mass-market brands in Europe.

Maserati aims to sell 7,000 to 8,000 of the new Quattroporte worldwide in 2013, and between 13,000 and 15,000 when the full range is available. By way of comparison, Jaguar sold 12,011 cars in the United States alone last year, Porsche about 35,000, and Maserati sold 2,730.

DIFFERENT THIS TIME?

While Fiat's previous attempts to build the Maserati and Alfa Romeo brands have fallen flat, Maserati CEO Harald Wester asserted at the Quattroporte launch last month that the pieces are in place this time.

"If I look back at 2005, the situation was difficult," he said. "We had quality issues at the time. We have no quality issues at this point."

Another difference is the partnership with Chrysler, which enables Fiat to save millions on development costs. Maserati can piggyback on Chrysler's dealer network. It can share platforms, cutting down on development costs. The Levante SUV could be built on a Jeep platform, while the Quattroporte shares underpinnings with the Chrysler 300.

That means the biggest challenge for Maserati will be to carve out its niche in a crowded field. Some reviewers have referred to the Quattroporte as a "four-door Ferrari" because of its speed, although it sells for tens of thousands of dollars less. Maserati will need to sharpen its brand focus and then use the dealer network to make a statement as it did with the Fiat 500, said Stephen Wunker, managing director of consultancy New Markets Advisors.

"One thing that the Fiat 500 experience has shown is how important it is to tailor your outlet to the product," said Wunker. "The downside is that it's costly and slow to get traction." (Editing by Matthew Lewis)



Comments (0) Add Your comment Add news < Previous news Next news >








  Add your news >>>