Italian automaker Fiat (NASDAQOTH:FIATY) is trying hard to turn its collection of brands into a cohesive global automotive empire. That's a tougher challenge than you'd think for the automaker that controls brands ranging from Dodge to Ferrari: There's a lot of work to do, and it all needs to be done in a hurry.
Fiat CEO Sergio Marchionne has been known to talk big -- but he has sometimes been able to back up that talk. Look at what Fiat has done with Chrysler: Left for dead in bankruptcy court in 2009, Chrysler is thriving and profitable. thanks to a high-speed overhaul of its product line that was masterminded by Marchionne.
That overhaul had analysts snickering when it was first announced: How could Fiat possibly turn Chrysler's uncompetitive products into well-regarded sales successes on the cheap? But it has turned out to be wildly successful.
Not all of Marchionne's plans have worked out as well, but that kind of success is worth taking seriously.
Now, Marchionne says that he will soon reveal a plan for one of Fiat's crown jewels: the storied Alfa Romeo brand. Marchionne sees Alfa as a global luxury-car brand, on par with the likes of BMW (NASDAQOTH:BAMXF).
That's not wildly implausible. Alfa has long been seen as a brand with tremendous potential. But in recent times, its products have been small and mostly uninspiring -- and not available here in the United States. That should change soon: The 2014 Alfa Romeo 4C is expected here next year. But much more will be needed to realize Alfa's potential.
We've been hearing for years that Alfa would soon have a dramatic global renaissance. So far, it hasn't happened -- but Chrysler's revival has taught us that sometimes, Marchionne's hare-brained-sounding schemes can produce great results. In this video, Fool contributor John Rosevear looks at what Marchionne probably has in mind for Alfa -- and at the cold hard reality that could cause this plan to crash hard.
Fool contributor John Rosevear owns shares of General Motors. You can connect with him on Twitter at @jrosevear. The Motley Fool recommends BMW and General Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.