Alfa Romeo's effort to recover its lost image as a maker of desirable - and reliable - sports cars takes greater shape on Thursday when it unveils a new model to widen its product range and appeal to younger drivers.
After posting images of the car on its web site (www.alfaromeo.com) in March, the brand within the Fiat group will show it off for the first time at an event in Milan.
Called the MiTo, the three-door compact is its first entry into the B segment of small cars where it will try to win over young drivers enamoured of BMW's popular Mini.
It will also give Alfa another chance to prove it can be taken seriously after years of disappointing drivers.
The move into the B segment could help Alfa given high fuel prices and concern about the environment that have pushed the trend towards smaller cars, even in the premium range, said a London analyst on condition of anonymity.
'It's a small car you can buy without shame,' he said, referring to well-to-do drivers who worry about their image by buying a smaller car. 'You're not down-sizing but fun-sizing.'
Most of Alfa's range is made up of bigger cars for older drivers like the A159 sedan.
Built on the platform of Fiat's Grande Punto hatchback, the MiTo will arrive in Italian showrooms in July and sell for a base price of about 16,000 euros ($24,750). It will reach dealers elsewhere in Europe by September.
Alfa aims to sell 40,000 units this year and double that number in subsequent years.
NOT AT THE TOP
Although Alfa is seen by car lovers as an icon of Italian style and speed, it acquired that image more than 40 years ago when it was at the top of its class.
Alfa has since gained a reputation for poor quality and service, leaving it to BMW and Audi to set the standard for premium sports cars.
The latest industry figures showed its market share in western Europe was less than 1 percent compared with more than 4 percent for each of the two other brands.
Even Lancia, Fiat's less well-known premium brand whose market is mostly in Italy, sells more cars. In the first five months of the year, it sold 53,868 against Alfa's 42,486, according to industry figures.
Fiat does not break out numbers for its brands, but analysts say Alfa Romeo loses a lot of money because of these paltry sales.
Fiat bought Alfa Romeo in 1986 and its latest efforts to turn it around began four years ago under the supervision of Sergio Marchionne, the chief executive officer who has won plaudits for overseeing the group's recovery from near bankruptcy.
Although Alfa Romeo is doing worse than the Fiat and Lancia brands, it has the potential of producing the biggest profit margins among them.
Even if the MiTo and subsequent new cars prove to be successful, analysts do not think that Alfa will meet an ambitious annual sales target of 300,000 units by 2010.
'The problem is that people aren't buying (the cars),' said one of them in Milan.
These doubts have not stopped Fiat from going ahead with plans to bring Alfa Romeo back to North America. It aims to decide in six months when and where it will build the cars in the region.
