FCA’s CEO admits that the company made a mistake by having both Maserati and Alfa Romeo headed by the same leader and treating it as though it were a “mass market brand.”
Maserati is a luxury brand that’s in some serious trouble. Whereas most luxury marques have no trouble achieving sky-high profit margins thanks to six and sometimes even seven-figure price tags, Maserati’s profits are down in the dumps.
According to Automotive News, Maserati’s earnings are down 87% to just 15 million euros in the third quarter of 2018. New car shipments fell 19%, and the brand’s profit margin is hovering in the mid 2% range after falling from as high as 13.8% at the same time last year.
What’s causing all the trouble? New FCA CEO Mike Manley told investors during last month’s earnings call that he believes the issue comes down to how the brand was managed "as if it were a mass-market brand."
From late 2016, Alfa Romeo and Maserati were handled under the same umbrella as the two lost European brands under FCA’s umbrella. Alfa Romeo has historically been a more mass-market brand than Maserati, and so combining the two inevitably meant that attitude would rub off on the other.
"With hindsight, when we put Maserati and Alfa together, it did two things. Firstly, it reduced the focus on Maserati the brand. Secondly, Maserati was treated for a period of time almost as if it were a mass market brand, which it isn't and shouldn't be treated that way," said Manley.
Automotive News points out another problem with Maserati, and that’s a lack of new products. The last vehicle Maserati launched was the Levante SUV, and that was two years ago. Since then Maserati has announced plans to launch two new Alfieri cars, a new midsize SUV, and to electrify their lineup, but haven’t put dates on any of it.
However, Manley is convinced that Maserati can still be turned back from the brink. He’s put chief technology officer Harald Wester in charge of rebuilding the brand and hired a former Ferrari marketing exec to get that ball rolling.
Whether or not it will be enough is anybody’s guess. Manley himself said not to expect any big news until the second half of 2019.