FIAT’s Problems with the 500
First, the company was “naive,” as CEO Sergio Marchionne has admitted, in setting a first-year sales goal of 50,000 FIAT 500s. Big mistake, and utter hubris to think the company could beat MINI its first year out. Still, nearly 20,000 were sold—no mean accomplishment.
The second big error was to push its dealers to set up separate, FIAT-only showrooms to make the car more exclusive than it should be. And then fail to give them support.
Error number three was not the J-Lo ad campaign that everyone is so quick to criticize, but the positioning of the car as something cute, customizable and upscalable (i.e., the Gucci version). See the newest Abarth ad after the break.
So the company got mired in the perception of the 500 as a girly car—because most American males think that anything small, cleverly designed and fun to drive is a chickmobile. Old habits die hard.
Now, FIAT is trying to get itself unstuck from this mess by introducing—finally—the Abarth 500, which should have been brought to market immediately with a basic 500 and maybe one other fancier trim. The price/performance factor will give it some sales clout ($22,000 base).
Finally comes a city car with real performance.
And there is talk about a 500 wagon to debut in March at Geneva, maybe using the 1.4-liter MultiAir engine that powers the Abarth. It may look something like the pix shown here of the ElleZero, which certainly echoes the MINI Countryman roofline but is a lot better looking.
Castagna, a coachbuilder in Milan, has created three versions of a 500 limousine, shown here, that are crazy and wonderful.
The Abarth is built in Toluca, Mexico; the wagon will come from Serbia; the American version of the 500 is sold in China and Brazil. It is amazing to think that the global appeal of this car will stall out in America.
Can FIAT and its 500 recover in the U.S. from a bad product launch?