After years of struggling to revive the ailing brand, Fiat/Chrysler CEO Sergio Marchionne appears ready to pull the Lancia brand off life support.
“The brand will be reduced or eliminated,” the executive revealed during a conference call discussing plans to improve the sagging fortunes of the entire Fiat Automotive Goup..
Even though the net profit of the Fiat Group in the third quarter came in at € 286, the maker’s debt increased to 6.7 billion. Lancia has been a significant part of Fiat’s woes in recent years, and Marchionne made clear that the focus has to be put on the group’s strongest brands, including Fiat, Alfa Romeo and Maserati.
Eliminating Lancia would not mean closing a plant in Italy, nevertheless the company’s shares saw a sharp decline on the stock market.
Marchionne expects the Fiat Group to not be able to reach break-even in Europe before 2016, because of the deep crisis in the Continental automobile market. He said the company has to regroup and to the surprise of many: “We have to be honest. Lancia will never be what is once was. The only model that is of any value in Europe is the Ypsilon, which will be saved. The rest of the range has no appeal.”