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Back on topic, of course a small dispalcement V8 will be better, but it will have to be build from ground up, what would be too expensive.
However, a possibily would be to build the 1.6l I4 engine into a 3.2l V8 engine, buy putting the two blocks together in a 90° V8 form. The 1.6l I4 making up to 220 PS, as a V8 it would make 440 PS, all this from a light 3.2l V8. There were rumors of Alfa Romeo working on a 3.0l V8 for their falgship 169, but I guess it is no more in the works as the 169 is cancelled.
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