UPDATE 1-AUTOSHOW-Alfa Romeo could build cars in Mexico for U.S.
(Combines previous stories, adds quotes, details)
GENEVA, March 4 (Reuters) - Italy's Fiat SpA (FIA.MI) is considering Mexico as a base to build its Alfa Romeo sports cars for export to the United States, a huge market where it plans to return sometime after 2008.
Fiat has been thinking about building the cars somewhere in North America to avoid the cost of exporting them from Italy, given the euro's strength against the dollar.
"It could be Mexico," Chief Executive Sergio Marchionne told Reuters Tuesday at the Geneva auto show when asked whether that country could be a likely location for a plant.
Fiat should decide later this year what to do, he added.
The head of Alfa Romeo, Luca De Meo, told Reuters in an interview that he and his team have yet to decide on what models to sell in the United States.
Details including the kind of distribution network to use should be disclosed in the coming months, he said.
Although Marchionne had previously set 2009 as the year to enter the United States, De Meo declined to confirm it.
But he said he had already started thinking about other markets where Alfa Romeo is present by reputation only.
"The United States is fine but there are also other regions where Alfa Romeo can use its image (to its advantage)," he said, citing China, Russia and South America as possibilities.
De Meo spoke to Reuters after showing off a convertible version of the Alfa 8C, a special edition car. Like the hardtop 8C, only 500 units of the convertible version will be sold.
De Meo took charge of Alfa Romeo in December after succeeding in turning around the Fiat brand.
Alfa Romeo is seen by analysts as a bigger challenge for him, however.
Although it could generate the biggest profit margins among Fiat's three brands, it needs a lot of work.
Its sales are mediocre and it losses trunkloads of money.
Years of poor parts and service have given it a bad name, denying it the premium status enjoyed by rivals like Volkswagen AG's (VOWG.DE) Audi and BMW AG (BMWG.DE).
De Meo's predecessor, Antonio Baravalle, had focused on improving customer service and expanding the dealer network in Germany and United Kingdom, two key markets in which to expand.
The revival of the brand has included a refurbishment of its main plant at Pomigliano d'Arco in Italy; but the plant's closure for the last two months has led to a loss of sales.
De Meo said one of his priorities this year is to try to recover those sales.
Another priority is the launch of a compact car with the working name of the Junior. The car would mark Alfa Romeo's entry into a new segment with a younger clientele.
As he works towards the 2010 sales targets set by Marchionne for every division within the Fiat industrial group, De Meo said he hopes to restore Alfa Romeo's place among premium brands by the time of its 100th anniversary on June 25, 2010.
"We need to restore the values of Alfa Romeo," he said, adding that the brand's birthday could be marked by the launch of a new model apart from the 149 and 169 scheduled to come to market in the coming years. (Editing by Gerald E. McCormick)
