Thursday, May 29, 2008

Fiat Considering Selling the 500 in the US

By Chris Haak


According to Automotive News, at the Automotive News Europe Congress in Turin last week, Fiat Group Sergio Marchionne said that his company is considering selling its iconic and wildly popular 500 minicar in the US. Further, the company wouldn't do so unless it actually built the car in the US, as importing a small, premium car from Europe would be extremely cost-prohibitive with the current weak dollar situation.

When Alfa Romeo, which is also owned by Fiat Group, finds a plant to build its vehicles to springboard its US relaunch in late 2009, that same facility could also produce the 500. By the company's own admission, they are speaking with anyone and everyone in North America about a potential production agreement; obviously, there is a lot of unused production capacity in the US right now, but some of the most flexible plants are the newer ones that haven't been mothballed. It sure would be neat to see an old Big Three facility get a new lease on life building Italian cars, though.

Fiat has seemingly mimicked key parts of the brand extension strategy of BMW's Mini brand with the 500; the three-door hatchback arrived first, in 2007. It will be followed by a convertible in 2009, then a long-wheelbase version in 2010 (that sounds very much the equivalent to the Mini Clubman from reading a description of it). Lastly, and again from the Mini playbook, Fiat is considering an SUV-like derivative that might include all wheel drive.

Assuming that the 500 can make the trans-Atlantic journey relatively unscathed (without being de-contented or diluted), it would be an instantly credible premium small car entry for a country that suddenly has found an appetite for them. Interestingly, Marchionne said that if Fiat does sell the 500 in the US (which at this point sounds pretty likely if the CEO is chatting about it with reporters), it would not mean that the Fiat brand will return to the United States. Mr. Marchionne, probably correctly, considers the 500 to be a brand by itself. With an expanded lineup of 500s, it would have the same number of models that Mini is likely to have.

An unanswered - and possibly un-asked - question is where the 500 will be sold. There are not US Fiat dealers; the company is going to re-launch Alfa Romeo with a six-figure flagship at select Maserati outlets (Maserati is also under the Fiat umbrella), and eventually there will be Alfa Romeo dealerships when the more pedestrian models are produced and sold in the US. I suppose that the 500 could be sold at the Alfa Romeo stores when they come online.

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