BMW and the Fiat Group recently announced the signing of a Memorandum of Understanding (more here) to share future vehicle platforms for the next-generation Mini and Alfa Romeo Mito -- but don't expect to see future Alfas underpinned by BMW 3 Series architecture.
"This tie-up is about Mini, not BMW cars," a well-placed source told the Carsales network. "The swap would appear to be to provide a joint small car platform -- front wheel drive -- so Mini can cut costs. It's not about engines at all, or rear-wheel drive."
"The Premium platform that Alfa currently has can also be configured as rear-wheel drive and they have the Maserati platform for larger cars, if they need it, but the Premium platform can meet all Alfa's large-car needs," according to our source.
The source also confirmed the proposed BMW-Fiat tie-up will have no bearing on the latter's current co-operative ventures with Suzuki and Ford -- and the BMW-PSA engine sharing arrangement (whereby the two manufacturers jointly produce the 1.6-litre unit used by the Mini and Peugeot 207/308) will also be unaffected.
"This (new tie-up) is about platforms and USA dealers," the source told Carsales, as the partnership will also pave the way for Alfa Romeo's return to the potentially lucrative US market, which it's shunned since 1995 as a reputation for poor build quality and plummeting resale values sounded the death knell for it.
However, this time around the venerable Italian marque aims to fare better, and our source said Alfa's US return was being planned to coincide with the brand's 100th birthday (in 2010).
"Alfa Romeo is a nice fit for American Mini dealers, to give them something to sell up into when a Mini buyer needs a bigger car," the source told Carsales.
"Mini buyers are quite different from, say, BMW 1 Series buyers, and in many respects Alfa is a better fit for them."
Fiat Group CEO Sergio Marchionne isn't overselling the concept, saying, "The US market is very large, and we're not looking to occupy a premier position. But I think we do have a couple of brands and products that we can sell successfully there."
The BMW-Fiat tie-up doesn't have huge implications for Australian buyers, but our source suggests the two companies may be able to offer keener pricing for the next-gen Mini and Mito respectively, owing to the amortised development/production costs.
However, he adds, "as both cars are very new (in their current guise), you are looking at something seven to eight years away."
The proposed BMW-Fiat tie-up is a symptom of the dire economic predicament currently faced by car manufacturers, particularly those who churn out baby cars, which offer meagre profit returns.
"Everything is going in the wrong direction for the industry: adverse currency effects, higher raw materials prices, which have so far been impossible to pass on to customers, and now a much weaker European market," Deutsche Bank analyst Gaetan Toulemonde was quoted as saying in a Reuters report.
While the Fiat Group has entertained several joint ventures over the years, the tie-up represents a departure for BMW, which has opted to go it alone thus far -- with the exception of its engine-sourcing deals for the Mini.
The previous-generation Mini used a Chrysler-built powerplant, while the current model's engine was jointly developed with PSA. BMW is also currently working with Daimler AG (read: Mercedes-Benz) to develop eco-friendly hybrid engines.
Meanwhile, Fiat boss Marchionne recently confirmed Fiat's fiscal targets for the year, which include a higher trading profit of between $5.6 billion and $5.9 billion.
"We are about to close the quarter and the results are all in line with the targets," Marchionne said. "We don't see anything coming up for the rest of the year, barring any disastrous events in the next six months," he said. "What's important is to see how the third and fourth quarters will go."
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