ARESE, Italy — A walk back in time through Alfa Romeo's museum here northwest of Milan reveals a company history as twisted as the country mountain roads on which its performance cars gained their reputation.
One of Europe's most storied brands, Alfa was born in 1910. It achieved the pinnacle of motorsport in 1925 with its first world championship, and was taken over by the Italian government in 1933 to save its coach-building business and the jobs it represented. The company transitioned to building aircraft engines during World War II, then emerged from Italy's ashes to produce compelling vehicles for sale around the world.
The 2020s bring another dramatic turn in Alfa's business model: a switch to battery power. Under the ownership of the Italian-French-U.S. conglomerate Stellantis NV, the Italian brand is relaunching itself into the U.S. market for the third time — call it Alfa 3.0 — since its debut in the mid-1950s.
The brand gained notoriety in North America with the iconic Duetto Spider (made famous by the hit 1967 movie "The Graduate") then again in 2014 with the introduction of a stable of athletic chariots including the 4C, Giulia and Stelvio. It's racing now for a hat trick.
With sharp handling and soaring gas engines, they polished Alfa's reputation for making emotionally-satisfying vehicles — however marred with nagging quality problems. Now, with the gas-electric, plug-in hybrid Tonale SUV — Alfa's first new model in five years — the brand joins other legacy premium brands like Cadillac and Jaguar that are going all-electric to take on Tesla amid a government push for zero-emissions automobiles.
"I feel . . . big pressure on my shoulders as we go all-electric," CEO Jean-Philippe Imparato said at Tonale's media test-drive at Alfa's Balocco Proving Grounds northeast of Turin. "We could have stayed in the internal-combustion engine space, but we decided to move to zero-emission by 2027. At the same time, we don't want to lose our sportiness as a brand."
Imparato and his team admit the challenges of meeting onerous government regulations in coming years — particularly in California and so-called ZEV (Zero Emission Vehicle) states where 50% of Alfas are sold in the United States — but he also said the consumer market has been fundamentally changed by Tesla.
"The premium consumer demands electric power," he told a roundtable just feet away from the hybrid, winged Formula One car that Alfa sponsors in the international open-wheel series. "They see internal combustion engines as old-fashioned, as a thing of the past."
The plug-in hybrid Tonale, which has been on sale in Europe for five months, goes head-to-head against the Audi Q3, BMW X1 and segment-leading Volvo XC40. It serves as a bridge to an Alfa lineup that will be fully electric by 2027.
It's a move that gives Alfa, which has struggled to gain traction in the United States, a chance to reboot its image with American consumers, said veteran auto analyst Karl Brauer of iSeeCars.com.
"Large auto conglomerates like Stellantis have decided to commit a brand to go full EV that will help them meet their (regulatory) mandates," he said. "Struggling legacy brands like Alfa, Cadillac, Jaguar and Mini have been quick to go all-EV as a way to tell a new story."
Alfa plans a handful of new EVs in the next six years covering 85% of the luxury market, said Imparato. That plan includes a midsize, E-segment sedan later this decade to compete with the BMW 5-series and Mercedes E-class. Alfa plans a small "Mini Countryman killer, a perfect urban EV" — likely for the European market — in 2024, but the first EV out of the chute for the United States may be a battery-powered sedan carrying the iconic Giulia badge.
"Electrification means the sedan is back due to its aerodynamics and light weight. You will have an all-electric Giulia," said Imparato, a speed freak who will pilot a ferocious, 330-horsepower Opel Astra TCR at the 24 Hours of Nürburgring race with Stellantis CEO Carlos Tavares later this month.
Imparato said the Giulia EV would gain a 1,000-horsepower variant (think Quadrifoglio performance model). He also indicated to U.S. media that "we want to build a car in your country" — following in the footsteps of European plants from BMW, Mercedes and Volkswagen that have sprung up across the South. That commitment has gained urgency as U.S. government subsidies for electrics favor models Made in the USA.
The Alfa team didn't shy from the R-word — reliability. Issues with that have plagued Italian brands in the U.S. market.
Alfa North America chief Larry Dominique said the U.S. dealer body is "part of the family" and that quality is on the table. "We aren't acting like a premium brand, and you aren't acting like a premium brand," Dominique said he told dealers when he took the helm two years ago.
The result has been marked improvement. Alfa jumped to the top of J.D. Power's 2022 U.S. Sales Satisfaction Index (SSI) — a climb of eight places. And Alfa was the biggest brand mover in JD Power's Consumer Satisfaction Index (CSI) this March — to 29th from 42nd.
Still, the brand's U.S. sales went in the opposite direction in 2022, dropping 30%.
"That's the kind of attitude they will need to have," said analyst Brauer. "Alfa has delivered cool products with looks, dynamic, and power — but they got left behind in a crowded U.S. market. Part of that has always been a question of reliability. They're tackling that head-on."
As if to underscore the EV challenge ahead for all automakers, the CSI study also recorded the first year-over-year satisfaction decline in 28 years as electric models led a wave of recalls. EV service satisfaction was 42 points lower than for gas-engine owners.
"I don't want to make any trade-offs on any items related to quality. In your country Alfa is Latin guys, emotional guys. . . you know what I mean . . . (who) are coming to our country with a (expletive) car,'" said the charismatic Imparato. "I want to demonstrate to the world that this brand is above that."
Imparato says that his marching orders from Stellantis CEO Tavares are not to obsess over market share: "I am not interested in getting into a price war," he said, alluding to Tesla EV price cuts that have lately roiled the electric segment. "My focus is on quality, value, margin."
Still, as regulations forcing EVs drive up new-vehicle transaction costs (averaging nearly $50,000 this year) into luxury territory, premium brands like Alfa could be crucial to corporate parents' profit plans.
Models stickering for more than $60,000 in the U.S. market leapt to 94 this year from 76 in 2021. Dominique said Stellantis projects the premium segment to grow by 34% in coming years compared to just 13% for mainstream models, with premium share growing from 17% to 20% of the pie.
Alfa awareness also has been helped by its Formula One team that has ridden the international sport's wave of interest among U.S. fans. F1 now fields three Grand Prix in the United States — the most of any country — including the U.S. Grand Prix in Austin that was the most-attended F1 race in the world last year with 440,000 fans.
"Motorsports is the best return on investment in Stellantis," said Imparato, reaching back to Alfa's racing roots to help write the new chapter ahead.
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