Summary
- Alfa Romeo abandons its 2027 all-electric goal, adopting a “multi-energy” strategy with gas, electric, and hybrid options.
- The brand is simplifying its lineup by eliminating trim levels for the Giulia, Stelvio, and Tonale, offering single “core” versions with optional packages.
- Alfa Romeo faces significant sales declines, with a 19% drop in 2024, and struggles with high inventory levels relative to sales.
- The automaker is considering bringing the subcompact Junior crossover to the US market to expand its offerings.
- Alfa Romeo’s future in the US is uncertain, with 2025 being a pivotal year as it navigates industry challenges and implements new strategies.
The path of the automotive industry is rarely linear. Too many factors including changes in consumer behavior, regulations, and leadership mismanagement affect how manufacturers’ strategies evolve. And a clear example of this is Alfa Romeo. The Italian automaker is the latest manufacturer to review its EV strategy. Alfa’s North American CEO, Chris Feuell, announced they no longer plan to offer only electric vehicles by 2027.
The change in plans includes offering an assortment of electrified (all-electric and hybrid) and gasoline models. They are also updating their lineup for this year so that Giulia, Stelvio, and Tonale no longer have different trim levels. But what’s behind these changes? Why has Alfa become another example of ambitious EV goals collapsing across the automotive industry?
Alfa Romeo Is Striving for Survival
Reeling Back on EVs
The decision to backtrack on its original plan to abandon combustion engines towards 2030 isn’t unique to Alfa Romeo. We’re seeing a broader trend across the automotive industry. Many automakers, such as Porsche, Mercedes-Benz which had a rough 2024, and Volvo, among others, are faced with flattening EV sales and are reassessing their electrification timelines.
Alfa Romeo North America chief Chris Feuell even pointed to the challenges faced by their dealerships, stating that forcing them to sell only EVs in just a couple of years would be too restrictive for their network of 110 dealers. This pragmatism is understandable. While the allure of an all-electric future is strong, the current market realities demand a more flexible approach. Alfa’s parent company, Stellantis, has designed its STLA platforms with this flexibility in mind.
A Shift to “Multi-Energy”
These platforms can accommodate a range of powertrains, from traditional internal combustion engines to fully electric systems and everything in between. This gives Alfa Romeo the option to offer a diverse lineup, catering to different customer preferences and market demands. This also paves the way for the development of potential ICE versions of the upcoming Giulia and Stelvio, which will be constructed on the STLA Large platform, akin to the Dodge Charger, which will also provide both EV and ICE options.
While the initial 2027 all-electric target was set for North America, enlarged Europe, and China, it’s now unclear if that target remains in place for those other regions. Former CEO Jean-Philippe Imparato hinted at this shift toward flexibility, suggesting Alfa could continue to use gas engines in the long term if that’s what customers prefer. The new CEO, Santo Ficili, seems to share this view, which gives Alfa Romeo a certain “flexibility” in deciding which powertrains to offer on the new Giulia and Stelvio.
Ditching Trim Levels And Expanding Its Lineup
Beyond the EV strategy shift, Alfa Romeo is also making some significant changes to its 2025 lineup. They’re ditching the traditional trim levels—no more Ti, Sprint, or Veloce. Instead, each model (Giulia, Stelvio, and Tonale) will be offered in a single “core” version. Customers can then personalize their vehicles by adding various packages and individual options. Want the sporty look and feel of the Veloce? There’s a package for that. Need advanced tech features? Opt for the Assist package.
This simplification of the lineup likely serves a couple of purposes. First, it could help streamline production and potentially reduce costs. Second, and perhaps more importantly, it comes at a time when Alfa Romeo is grappling with very poor sales. This sales slump, combined with the elimination of trim levels, raises some serious questions about the future of these models.
It’s not uncommon for automakers to simplify trim levels as a prelude to canceling a model or at least ending a generation. While Stellantis has pledged not to kill off any brands, the combination of poor sales and this trim-level simplification certainly has us wondering about Alfa Romeo’s long-term prospects.
In addition to the simplification of its current lineup, Alfa Romeo is seriously considering bringing its new subcompact crossover currently available, the Junior, to the US market. North American CEO Chris Feuell has been gauging dealer interest in the vehicle. The Junior, already available in Europe in both electric and gas versions
They’re Stocking More Cars Than They Sell
Sales Slump
But the problems with Alfa Romeo go far beyond its EV strategy and trim levels. The brand is in deep dives on sales compared to the number it was able to post just a few years ago. The Italian automaker faced a challenging 2024 with sales declining by 19% to 8,865 vehicles compared to 10,898 in 2023. The Stelvio and Giulia models experienced significant drops, with sales decreasing by 41% and 33%, respectively.
Despite the introduction of the new Tonale compact SUV, which sold 3,383 units in its first year, the brand was unable to offset the overall sales slump. This steep decline raises serious questions about Alfa’s future in the U.S. The numbers tell the story.
Inventory Issues
According to CarEdge, Alfa Romeo has one of the lowest total inventories in the US but has the third-highest days of supply with 193 days just below Ram and Mini. The national average is 113 days. This means they have a lot of cars sitting on dealer lots relative to how many they’re selling.
That oversupply issue is compounded, as even the Tonale, which was initially seen as the brightest spot for the brand, faces its own set of challenges, including a massive recall of almost 80% of Tonales sold in the US. The recall over the possibility of a brake pedal failure certainly did little to help Alfa’s image or its sales figures last year.
While Stellantis has taken steps to rectify the problem of over inventory and to push sales of all its brands, including Alfa Romeo, the severity of the situation for the Italian automaker is undeniable. The coming years will tell if Alfa Romeo weathers this storm and cements its place in the US or not.
2025 and Beyond
Alfa Romeo’s future, at least in the United States, is not secure. 2025 will be a pivotal year for the Italian automaker, and with a new CEO of its parent company, Stellantis, along with new strategies in its lineup and EV plans, it may move the needle for the Italian automaker. The potential introduction of a new model and simplified purchasing processes will be the main cards Alfa Romeo plans to play. Meanwhile, Alfa Romeo will need to navigate a constantly changing industry to overcome this series of challenges.
