Board Thread:Questions and Answers/@comment-24577079-20150113025115/@comment-3428312-20150511221933

Most of Italy's problems in the war were due to crappy equipment and an extremely poor officer corps. Outside of that, they were rated as fairly decent troops by the Germans, especially in terms of their artillery units and logisitics abilities. Rommel basically summed up their situation with "Good soldiers, bad officers". With that in mind, a good PoD is Mussolini dying in early 1940 before Italy joins the war (Insert another PoD if applicable). Let's say they remain neutral until early 1942, which gives them time to requip their forces but probably won't solve their officer troubles.

The main effect of this is to allow Barbarossa to start in May of 1941, and without any force committments in North Africa and much reduced ones in the Balkans. The extra time, forces, and most importantly supplies will probably allow for Moscow to fall by late October or early November. Once that settles, the Germans will most likely have several weeks to ready up for the Soviet counterattack, and possibly carry out some effective assaults upon the power stations of the Upper Volga and to the east of Moscow. Soviet production of things from electronics, aero-engines, tanks, etc would have been seriously crippled. 1942 opens, and the Finns cut off the Murmansk railroad while the now ready Italians join in. Alt-Case Blue achieves its goals, taking the oil fields and shutting off the Iran supply route. 1943 will essentially consist of mop up operations up to the Urals, where the Wehrmact will establish a firm defensive line while continuing Anti-Partisan actions to the West.

Japan will still likely get crushed by the USA, but presuming Hitler doesn't declare war, the Americans won't do much against the Germans except Lend Lease to the Anglo-Soviets.