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Fiat needs more than the 500 to revive core brand
Agnieszka Flak
October 5, 2014

PARIS (Reuters) -- While rivals rolled out new models and concept cars, Fiat had little to display at the Paris auto show besides the 500X in what is starting to look like a worrying trend for the carmaker's namesake brand.

Following the full takeover of U.S. unit Chrysler, the newly-named Fiat Chrysler Automobiles (FCA) has set out an ambitious growth plan focused on its upmarket Alfa Romeo, Maserati and Jeep brands.

Analysts say it makes sense to concentrate on higher-margin premium vehicles that are selling strongly in the United States and emerging markets, but are concerned the group is neglecting a Fiat brand which still accounts for a large chunk of sales.

FCA sold 1.5 million Fiats last year, with deliveries of the mass-market brand accounting for 34 percent of the group total.

"The 500 is getting older and older, the success of its variants has been limited and they lack a competitive offering at a time when Volkswagen, Peugeot and Renault continue to launch new cars," said Sascha Gommel, an analyst at Commerzbank. "Even if the European recovery was gaining momentum, Fiat would definitely lose out."
"Mini did the classic rollout of keeping sales steady over the years by slowly and steadily introducing product variations, but Fiat is not that disciplined," said Jane Nakagawa, managing director at Portia Consulting. "To the average consumer, the variations they have come out with were relatively invisible."
FCA said during its strategy announcement it recognized the need to purify the DNA of the Fiat brand, and that it would develop products that are either "functional" or "aspirational."

It also said it would leverage the 500 family to expand in the upper segment of the mainstream market.

"That entire brand has lots of magic sprinkled on their product," said Portia's Nakagawa, referring to the 500’s past successes and the new Panda, which has been selling well. "But they also need to make some hard choices about which models fit the idea of functional or aspirational, and which need to go."
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Article makes some great points. The 500 is a great product, but it's getting old and it's hard to follow up a hit with a successful replacement. Meanwhile, the rest of the lineup is starting to look old. Outside of the new Panda, the best performing Fiat in Europe seems to be the Freemont.
Meanwhile, Fiat dealers say the 500 revamp has failed to rub off on other cars within the brand, some of which are looking tired. Fiat's Punto subcompact hatchback is already nine years old.
That's true. The Punto used to be their bread n' butter. They've revised it for markets like India, but haven't done the same in Europe. That's really curious and shortsighted.

If the lineup is split between "aspirational" (the 500 family) and "function" (everything else), they'll have to tread carefully. I wish them well, but can't help but feel they are going to "paint themselves into a corner" with the way they're handling the portfolio.
 

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Sascha Gommel, an analyst at Commerzbank
Commerzbank? Really? Those guys didn't foresee the crisis, even the was already there. We should let you go bankrupt instead of pumping tax money into your bank to rescue you. /rant
 

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This was a good article, and the author is right. The 500 family won't support the whole Fiat brand, especially here in the US. I'm kind of wondering at this point why FCA even bothers with the Fiat brand here in the US.
 

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We wont know how the 500 Family will work untill the 500X is on lots. In the US there isnt a need for the Punto or Panda, we have other alternatives.
 

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We wont know how the 500 Family will work untill the 500X is on lots. In the US there isnt a need for the Punto or Panda, we have other alternatives.
Well, considering the Jeep Renegade is the more American version of the 500X, I doubt the real 500X will do too well.
 

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Well, considering the Jeep Renegade is the more American version of the 500X, I doubt the real 500X will do too well.
Yes but the 500x is more of a Crossover than the Renegade which is more of a SUV because of its Drivetrain features and Seating position.
 

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Yes but the 500x is more of a Crossover than the Renegade which is more of a SUV because of its Drivetrain features and Seating position.
The 500X is more of a hatch in my mind. The Renegade is the crossover.
 

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Fiat isn't going to be a big brand in the US, and FCA has made that pretty clear in just about every press gathering where the subject is about product planning...... so I'm not sure what the news here is, or why there's much discussion about it.

Chrysler will be the volume brand here, with Fiat carving out a niche market (ie: BMW's Mini). Alfa Romero will grow into a luxury brand (if they ever get it off the ground), Maserati is the step above (which IMHO is already positioned as a luxury brand, making AR relatively pointless) and Ferrari will be.... Ferrari.

As huge as FCA is globally, they don't need to make Fiat a big brand.

No news here.
 

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We wont know how the 500 Family will work untill the 500X is on lots. In the US there isnt a need for the Punto or Panda, we have other alternatives.
We don't really have anything like the Panda on our market. The Punto is Fiesta/Sonic-sized. The closest the Panda gets would be the Spark and maybe Mirage. But it's nicer than both.

And we REALLY don't have anything on our market like the Panda 4x4.
 

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Fiat isn't going to be a big brand in the US, and FCA has made that pretty clear in just about every press gathering where the subject is about product planning...... so I'm not sure what the news here is, or why there's much discussion about it.

Chrysler will be the volume brand here, with Fiat carving out a niche market (ie: BMW's Mini). Alfa Romero will grow into a luxury brand (if they ever get it off the ground), Maserati is the step above (which IMHO is already positioned as a luxury brand, making AR relatively pointless) and Ferrari will be.... Ferrari.

As huge as FCA is globally, they don't need to make Fiat a big brand.

No news here.
So youll want a Maserati "3 Series fighter" with a 1.??L I4 making 170hp?? Cause thats whats Alfa Romeo is going after.
 

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We don't really have anything like the Panda on our market. The Punto is Fiesta/Sonic-sized. The closest the Panda gets would be the Spark and maybe Mirage. But it's nicer than both.

And we REALLY don't have anything on our market like the Panda 4x4.
The only thing closest to the Panda is the 500x and Renegade which is a Segment above than the Panda, Dodge is getting the Fiesta/Sonic sized car so a B Segment Fiat isnt needed. with Dodge getting the B Segment. They will be able to sell in larger volumes than Fiat because of the Larger Network. Afterall, C and D Segments are the largest market in the US. Fiats wasn't ment to sell like Toyota's
 

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Mostly a range of co-developed Dodge-Fiat products should work. European variations like wagons and such should be good too. At least point -and as the article says- Fiat just needs a wider range of vehicles. Most everything that they have right now is a 5D hatch.
 

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The only thing closest to the Panda is the 500x and Renegade which is a Segment above than the Panda, Dodge is getting the Fiesta/Sonic sized car so a B Segment Fiat isnt needed. with Dodge getting the B Segment. They will be able to sell in larger volumes than Fiat because of the Larger Network. Afterall, C and D Segments are the largest market in the US. Fiats wasn't ment to sell like Toyota's
The Panda is A-segment. And Fiat can sell A, B, and C-segment vehicles as long as they're distinctively Fiat and Italian. They should not do mainstream. And the 500 franchise is only good for so many variants. Stretching the 500's cues to the L an XL seems silly to me.
 

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The Panda is A-segment. And Fiat can sell A, B, and C-segment vehicles as long as they're distinctively Fiat and Italian. They should not do mainstream. And the 500 franchise is only good for so many variants. Stretching the 500's cues to the L an XL seems silly to me.
Is it really??
Fiat 600 Mutilpa



Yet Mini Gets a pass offering a B Segment Crossover, Coupe, Convertible, 3 Door, 5 Door...Did we all forget that the 500 family Comes in almost every configuration? The 500L is basically a C Segment in a B Segment world. A C Segment Fiat would not sell. Why dont you see Scion with a C Segment sedan.
 

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Not on the ground in Europe, but Fiat's lineup looks pretty pathetic compared to VW et al. Cute city cars only carry you so far.

Would I have been interested in a midsize Fiat over my Accord if offered here? Probably not, if it looked like a 500.

Question... what's FCA going to do for a volume brand in Europe if Fiat is... I don't know what, and Chrysler is their volume brand here?

What about South America? China? Everywhere else?
 

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Is it really??
Fiat 600 Mutilpa


Yet Mini Gets a pass offering a B Segment Crossover, Coupe, Convertible, 3 Door, 5 Door...Did we all forget that the 500 family Comes in almost every configuration? The 500L is basically a C Segment in a B Segment world. A C Segment Fiat would not sell. Why dont you see Scion with a C Segment sedan.
Wow.

1) The 600 Multipla didn't carry the 500's styling cues. It came out a year before the smaller 500. And those were simply the styling cues of a small, cheap rear engine vehicle of the day.

2) The 600 Multipla is 0.6" shorter, 7.1" narrower, and 3.6" lower than the current Fiat 500. Not the 500L. It's smaller than the regular 500 3-door hatch.

3) Fiat and Scion are not the same thing. But even so, I agree that Fiat doesn't need a C-segment sedan. I never said they did. That's what the Dodge Dart is for. I said Fiat can do A, B, and C-segment vehicles as long as they're distinctly Fiat. The 500L is in the B-segment as it pertains to size. The only dimension in which it is significantly bigger than the Chevy Sonic is roof height. A C-segment replacement for the lovely Bravo would do quite nicely in America, I'd think. See below:





4) I find it bizarre that you think the Mini brand has more flexibility than Fiat. The entire Mini brand is based around one car from 1959. Fiat is a very old brand with lots more heritage and variety to draw from.
 

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Not on the ground in Europe, but Fiat's lineup looks pretty pathetic compared to VW et al. Cute city cars only carry you so far.

Would I have been interested in a midsize Fiat over my Accord if offered here? Probably not, if it looked like a 500.

Question... what's FCA going to do for a volume brand in Europe if Fiat is... I don't know what, and Chrysler is their volume brand here?

What about South America? China? Everywhere else?
Fiat is a volume brand in South America and everywhere else. That's why the Dart gets rebadged and sold in China as a Fiat Viaggio instead of a Dodge Dart.



No, they're not as successful as VW in Europe. No one is. And mainstream midsize sedan sales are drying up in Europe anyway. They've been giving way to crossover and premium luxury compacts like the 3-Series, which Fiat attempted to combat with the Lancia Lybra and Alfa 156 and 159. Fiat hasn't offered a Passat competitor in Europe since the Croma of the 1990s. I do agree that the Fiat line has been scaled back too far over the last few years. Two separate near bankruptcies in 7 years will do that to a company. They put their development dollars into what they've always done best - small cars - and rode the storm out.

How the brands and lineups play out at this point is still to be seen. But I guarantee you that Fiat will lead FCA's charge in Europe and Chrysler will here in NA.
 

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I thought the idea was to shared Fiat - Alfa dealerships. Each brands only needs 2-3 models. They'll both be pretty limited but that's fine. Focus is good.
 
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