By on March 10, 2011

It’s been a good day for drama, what with GM losing its CFO, Saab’s principals turning on each other, Carlos Ghosn showing the first signs of losing his grip on his global empire, and Rs and Ds battling over GHGs. But what today was missing in the drama department was a spat between two legitimate stars, a throwdown featuring the hot young celebs of the automotive world. Well, thanks to ASCA.it [via Carscoop], we have it. Speaking to the Italian press, Ford CEO and industry darling Alan Mulally took on Fiat-Chrysler’s up-and-coming global starlet, the Fiat 500, bashing its chances of success in the US.

Mulally also talks of competing with Chrysler and about the market prospects of the Fiat 500 in the United States, provides: ”I do not see big market space for one car in the U.S. more ‘smaller Fiesta.” He added: ”Who has tried has failed.”

Presumably Mulally was comparing the 500 to Daimler’s Smart brand effort, in which an established automaker attempted to bring a new brand and a premium A-segment city car to the US and failed badly. And Mulally isn’t just idly speculating either: if he thought a sub-sub-compact car would sell profitably in America he’d bring Ford’s Ka, which is built on the same platform as the Cinquecento, here and make a fight of it (hell, it’s already appeared in a Bond movie). And with Chrysler’s plan to sell 55k Fiat 500s in the US this year already “a little bit behind,” it seems Mulally’s skepticism may be well-placed.

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31 Comments on “Quote Of The Day: Mulally Doubts The Cinquecento Edition...”


  • avatar
    Z71_Silvy

    Ignorance is bliss.
     
    Way to go airplane guy.  My guess, that little 500 will wipe the floor with the mediocre Fiesta….who’s sales have been far from ‘decent’.

    • 0 avatar
      Loser

      Ignorance is bliss.
      That would peg you as one happy guy.

    • 0 avatar
      MikeAR

      Silvy, you mean whose not who’s, who’s is a contraction for who is. And yep, you are pretty much blissed out.

    • 0 avatar
      Silvy_nonsense

      Based on FIAT’s (and Alfa Romeo’s and Lancia’s) track records for reliability (and I’m referring to cars currently on sale, not what Americans remember from the 70s), the only thing likely to be wiped off the floor will be fluids dripping out of the engines and transmissions of every 500 in every garage everywhere in America.

  • avatar
    parbuster

    Mullaly is a rock star. 

  • avatar
    Joss

    Well Mr Mulally your Fiesta has been a disappointment for you in NA. So you should know.. A big question mark for the Fiat 500 market here is the automatic. Unknown in europa & unproven here just like the Fiesta dual-clutch.

    • 0 avatar
      NulloModo

      The Fiesta has been far from a disappointment.  It isn’t the top selling vehicle in its class, but it also isn’t the worst by any stretch, and outsells many established competitors in both numbers and certainly average transaction price.  A car doesn’t have to sell 10,000 a month to be a success.  Also, Fiesta numbers have been up month on month for a while, and the Feb. results were very good.
       
      Perhaps more importantly than numbers, many Fiesta buyers are first time Ford owners.  People are looking at and buying the Fiesta that might not have considered any other Ford vehicle, and if they like their experience, are likely to come back to the brand when they are ready for a bigger car.
       
      Finally, the Fiesta’s biggest competitor has been in the same showroom – the Focus.  For those concerned only with price, it’s possible to get a nicely equipped Focus for less than an equivalently equipped Fiesta due to the larger incentives on the Focus.  Inventory levels on 2011 Focuses are very low however, and the 2012 model is about a month away from the showrooms, so, this won’t be a problem for much longer.

    • 0 avatar
      Silvy_nonsense

      “Perhaps more importantly than numbers, many Fiesta buyers are first time Ford owners.”
       
      That’s the best news of all. The Fiesta is a great car that will make a really good first impression on buyers who are presumably younger, are experiencing their first “brand spanking new” car and have many future car purchases ahead of them.
       
      Being the “best selling car” in a segment is as easy as dumping a bunch of low spec cars on the fleet market at bargain bin prices. That’s not very impressive – any dope at a car company can move metal by giving away the store. I’m really glad to hear that Ford has been successful in ramping up average transaction prices by moving lots of higher spec. (and therefore higher profit) cars, even in the entry level segment.

  • avatar
    JKC

    I doubt I know 1% of what Mr. Mulally knows about the car business. I would guess, though, that the reason that the Smart did so poorly was that it got miserable fuel economy for its Lilliputian dimensions. The fact that several larger cars beat its fuel economy numbers means the Smart never had a chance in the States.

    • 0 avatar
      Robert.Walter

      You are correct. Car sold on fashion, and ease of pkg in city scene … fuel econ good, but not in line with price, hence bad financial value if you are not into fashion in the city. If crude keeps rising ForTwo in US will get a bounce.

      Full disclosure: I live in europe, pay 7.00 bucks a gallon, and drive a Smart ForTwo; works ok here, but was also a market flop here only selling at about 50% of volume expectations.

    • 0 avatar
      Ron

      In Europe, at least, for $200 more you could buy a car with room for four and similar gas mileage. Aside from “style”, the only thing the Smart has going for it is the ability to park in really teeny spaces.

    • 0 avatar
      Silvy_nonsense

      The Smart forTwo is a great concept, but was very poorly executed. In addition to poor fuel mileage in comparison to other small cars, every review I’ve read has had nothing but bad things to say about the steering, brakes, ride, engine refinement, etc. Even if we take it’s small size out of the equation, the forTwo just isn’t a very good car.
       
      The comparably sized Toyota iQ (Scion iQ in the U.S.), on the other had, has gotten one good review after another. I don’t think we’ll really know how well a really small car can sell in the U.S. until we get one that’s well regarded like the iQ. Toyota’s image problems aside, if the iQ doesn’t sell then we won’t be able to blame it on anything other than large numbers of Americans not wanting a really small car.

  • avatar
    Loser

    Smart vs 500 doesn’t seem a valid comparison to me. IMHO, Smart is a city car while the 500 appears to be something you could feel safe driving at 75 MPH. Not to mention the 500 can seat 4 people. Wasn’t the Mini it’s target?

    • 0 avatar
      Russycle

      Agreed.  Smart really had nothing going for it besides being easy to park, not exactly a huge selling point outside of Manhattan.  I think Fiesta’s problem is it doesn’t have enough personality, won’t be an issue for the 500.  No guaranty it will succeed, but  500 doesn’t really compare to either Smart or Fiesta.
       
      With gas going up I suspect Fiestas will start moving, Chrysler needs to get in gear and catch that wave with the 500.

    • 0 avatar
      Robert.Walter

      I drive comfortably on the Autobahn in my Smart ForTwo at 150 kmh for hours on end.

    • 0 avatar
      snabster

      hmm.  Washington.  Boston.   SF.  Miami.
       
      I realize parking is a minority concern, but a bit larger than “manhattan”
       
      First number I look at for a car:   turning radius.  Second, back window visibility for street parking.

    • 0 avatar
      Silvy_nonsense

      You must live in the middle of a cornfield in Kansas if you think Manhattan is the only city in the U.S. with horrible parking problems. San Francisco, Seattle, Los Angeles, Boston, Washington D.C., etc, etc. – and its not just downtown. Lots of older residential neighborhoods in big cities have single family homes and apartment buildings with no garages causing massive on street parking hell. It’s not just the big cities themselves, it’s many of the communities that surround them. You wanna park on the street in Manhattan Beach, CA, for example? Good luck with that. Parking anywhere near a major university also isn’t usually a carefree experience.
       
      I’m tired of all the time I spend driving around looking for an open parking space and I don’t live downtown or in Manhattan. It’s a massive waste of my time that I’ll never get back and I’d be happy to buy a high quality small car if that will reduce the amount of time I spend circling around looking for a place to park.
       

  • avatar
    ExPatBrit

    Exactly Cinquecento is a lifestyle type vehicle just like the Mini, reasonable gas mileage might help but it’s not the be all and end all.
     
     
     
     
     

  • avatar
    MikeAR

    He is probably wrong about the 500. The Mini has done well and that is what the 500 is most comparable to rather than the Smart.

  • avatar
    Lorenzo

    Is there room for TWO upscale “Aw, it’s so cute” cars in NA? Mini is established and has some (modest) performance chops. The 500 has A-I-S-C and is reportedly fun to drive – with a stick.  I’m guessing Sergio thinks Italian style is the trump card. If I were Sergio, I’d be looking for a fallback position, maybe dropping a hemi behind the front seats and going for a mid-engine performance 2-seater.

  • avatar
    anchke

    Problem with the Smart Car was everytime I’d see one in traffic with fuul-size cars, trucks and buses, I’f think, anyone who would put their spouse/kids in that thing and send them into a hostile world is stupid.

    Or, I’d think, that nitwit coulda bought a Honda Civic.

    Plus there is a limited market for this size vehicle in NA, and it already seems glutted. As a transportation machine they’re — Fiestas, Minis, 500s – not the right tool for a lot of transportation jobs.  

  • avatar
    Ken Elias

    There are two problems with the Fiesta – it’s too small for many Americans (e.g., those with more than 150 lbs on their frames) and it’s over-priced relatively speaking to other larger vehicles like the Cruze or the Elantra.
    As far as the 500 goes, it’s going to miss its sales targets here by 50%.  Same problems as the Fiesta – you can buy a larger car for the same money with more space, power, and goodies.  While it’s certainly “cute,” that appeal has a limited demographic.

    • 0 avatar
      jimboy

      I agree with your estimate of sales for the 500. Depending on gas prices, it could sell a lot more if prices stay high. I would certainly look at one as a second/city vehicle if todays gas prices continue.

    • 0 avatar
      SV

      I’m 6’1 and far from svelte and I have absolutely no problem fitting comfortably in the front of the Fiesta. The back seat is more of a problem, and I can see that being a sticking point for some.
       
      Regardless of its packaging issues, though, the Fiesta’s sales are actually starting to pick up – more than 6000 units sold last month, ahead of every competitor apart from (of course) the Versa.
       
      I could see the Fiesta selling 55,000 units this year with relative ease, but that same performance from an even smaller car, with 2 fewer doors and worse fuel economy? As much as I like the 500, I have my doubts.

  • avatar
    Robert.Walter

    Keep in mind that the Ka is built by Fiat under contract to Ford for sale in Europe.

    It could very well be these things conspire to keep Ka out of US:
    1. Contract agreement that Ford can’t sell car outside of defined markets,
    2. For a car with limited market potential, a) cost to homologate Ka for US regs, b) cost to industrialize for US market, c) limited possibility that Fiat would license its platform for Ford to use, or buy from Fiat as in EU, lest Ford take some mkt share away from 500 in NAFTA mkt.

  • avatar
    Buckshot

    You don´t need the Ford Ka in the Usa.
    It doesn´t  have any weaknesses, but it´s as exciting as watching paint dry.
     

  • avatar
    windswords

    That Ka looks like it’s really hungry. Or in a very bad mood.

  • avatar
    Rod Panhard

    Yes, the Fiat is cute. Yes, it will appeal to fashionistas who want something that’s not a MINI and don’t or can’t afford lease payments on a 3-series. Yes, the Fiat is “new” so a lot of people won’t notice the baggage in the trunk. That baggage includes:
    - it’s a Fiat, which doesn’t bode well for reliability, according to European surveys.
    - That it’s also a Chrysler, which doesn’t bode well for reliability surveys.
    - That it’s made in Mexico, which doesn’t bode well during the raging Culture Wars. “We bailed out Chrysler so they can build cars in Mexico?” or “Why should I buy a car made in Mexico when I can buy a UAW built car in America?”
    It’s sales will have to rely on fashionistas, and those of us who describe ourselves as “Car guys” and don’t mind taking the risk on one of these because they have another car.
    Sounds like smart all over again.

  • avatar
    Junebug

    A good friend bought a Mini – I spent some time with it since I detail cars (second job) and kinda liked it, cute, fun to drive and got plenty of looks from people watching a 225 lb redneck try to get in&out of it. I asked them where the parade was and had anybody seen my fez hat?

    Anyway – my boy sold the car recently and I had to guess it was due to his wife expecting their first child, no, it was in his words – cause the damn thing is so friggin hard to work on, ask about changing the oil and you’re likely to need SPF50000.

  • avatar
    mjz

    Sorry, but I don’t think Mulally is right about his one. The comparison to the Smart is not valid, that is a two seater that is weird but not cute, like the 500. In reality, the Mini would be a better car to compare to. It’s got all the charisma for thousands less. Add in the fact that gas will probably be $4-5 per gallon soon and I think the 500 will be a big hit for Chrysler/Fiat.


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