Fiat 500: Yup, It's Flopping

Edward Niedermeyer
by Edward Niedermeyer

I was not the only person to predict that the Fit 500 would enjoy strong initial sales and then flop as the novelty wore off… and I was half right! Sales climbed early, peaking at around 3k units per month this summer before dropping precipitously in September and October. In August were still wondering if the 500 could become a classic, but as of November 1, Fiat 500 inventory stood at a staggering 184 days. Now, Automotive News [sub] quotes UAW officials as saying that

Chrysler Group has suspended production this month of the 1.4-liter FIRE engine that powers the Fiat 500 in North America because of slow U.S. sales of the subcompact

One in four workers at the Dundee plant where that engine is made has been laid off according to the report, which is a pity considering Fiat got five percent of Chrysler in return for those US jobs. And keep in mind, this is happening at a time when anecdotal reports of Fiat 500s in rental fleets are beginning to become more common… the 500’s retail sales number is likely quite a bit lower than the gross volume numbers cited here. Nor do we know what kind of incentives are being used to push the 500 out the door. But despite all this, and the fact that the 500 will not sell the hoped-for 50,000 units in North America, Chrysler is keeping a brave (or is that delusional?) face on the situation, telling AN that it is

very pleased with the progress we are making with the North American launch of the Fiat brand.

Really? Really? Wait, hold up a moment, I predicted that too! Way back in November of 2009, I wrote

Fiat wants to use the 500 to consolidate its strong presence in Latin America, where small, 100 hp vehicles are more accepted. The majority of 500 production at Toluca, Mexico will go to Brazil and other Latin American countries, as a halo for the Fiat brand’s success there.

Meanwhile, in the US market, the 500 will be little more than an overpriced fashion accessory… Nobody, from Sergio Marchionne on down, cares if this car succeeds in the US except for the fashionista fanatics who will pay nearly any price for one.

It just turns out that there are fewer of those people left than anyone thought…

Edward Niedermeyer
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  • Pja48142 Pja48142 on Dec 06, 2011

    Here in Toledo we have a ton of Chrysler employees because of the Jeep and Chrysler plants here. We had one of the first Fiat dealers in the country, because they must've thought employees would flock to it. They didn't. In fact, the dealer was slapping a $2000 ADM on each car at first. That helped keep them off the roads. Now the dealer is advertising them as a special employee lease at $99/month with $2995 down. In the Chrysler world there are often extra incentives for employees and family that are not available to the general public. That extra incentive plus $2995 must get the lease down to $99/month. We'll see if anymore hit the roads of NE Ohio....

  • Stevelovescars Stevelovescars on Dec 17, 2011

    This chart leaves a lot of room for interpretation. One could also argue from this data that for the past few months, Mini and Fiat have essentially split the market for small European coupes, though Fiat did it with a fraction of the dealers, no incentive cash/financing, and only one available base engine while Mini had turbos to sell. From this perspective, they are holding their own while the market waits for more dealers and the Abarth. Personally, I really wanted to love the 500. I was in the UK shortly after it was introduced there and accompanied a friend to a dealer when he was shopping for one. This guy is a big car nut, driving a collection of classic MGs and a Bentley, and he bought one with a 1.2 L multiair engine as his daily driver and he loves it. When the dealership finally opened here near me in Northern California I went to drive one. The salesman was enthusiastic about the car and seemed very knowledgeable. I was looking for a manual transmission and he lamented at the time that nearly all of his sales were manuals but his inventory was heavy on automatics (seems someone at Fiat listened to people at Chrysler who said that there is no market in the U.S. for stick shift cars). I drove a Sport model (the only one he had available with the manual) and thought it was OK but underwhelming. Other than the styling there just didn't seem to be much to the driving experience different from any small Japanese car. The engine, for all the hype, just didn't offer breathtaking fuel economy and just sounded like any droning 4-cylinder... I was hoping for a bit more character to make up for the performance... sort of like an older Miata that sounded tuned and fun despite a relative lack of oomph... but this just didn't feel or sound special in any way. From a pricing perspective, I actually think the base Pop model was a very fairly priced car. It included nearly all of the options one would really want, including power everything, USB for my iPhone, and the same engine as the other cars. Another $500 would add alloys for a total of $16k. This is but a small price premium over a Mazda2 or even a Hyundai. However, most of the cars on his lot were loaded Sports and Lounge models with sticker prices near or over $20k, and at this price point it just didn't seem like enough difference over the base Pop. Oh, and the sunroof was terribly designed. Where I live, Sacramento, it gets into the triple digits in the summer with no cloud cover and the sunroof had no fully opaque shade, the screen it comes with just let way too much heat into the car. Mini had the same design flaw, actually, what, it doesn't get sunny in Europe? England I can understand the oversight, but not Italy. If one lives in California or the Southwestern U.S. the sunroof is a no-go option.

  • 3-On-The-Tree I don’t think Toyotas going down.
  • ToolGuy Random thoughts (bulleted list because it should work on this page):• Carlos Tavares is a very smart individual.• I get the sense that the western hemisphere portion of Stellantis was even more messed up than he originally believed (I have no data), which is why the plan (old plan, original plan) has taken longer than expected (longer than I expected).• All the OEMs who have taken a serious look at what is happening with EVs in China have had to take a step back and reassess (oversimplification: they were thinking mostly business-as-usual with some tweaks here and there, and now realize they have bigger issues, much bigger, really big).• You (dear TTAC reader) aren't ready to hear this yet, but the EV thing is a tsunami (the thing has already done the thing, just hasn't reached you yet). I hesitate to even tell you, but it is the truth.
  • ToolGuy ¶ I have kicked around doing an engine rebuild at some point (I never have on an automobile); right now my interest level in that is pretty low, say 2/5.¶ It could be interesting to do an engine swap at some point (also haven't done that), call that 2/5 as well.¶ Building a kit car would be interesting but a big commitment, let's say 1/5 realistically.¶ Frame-up restoration, very little interest, 1/5.¶ I have repainted a vehicle (down to bare metal) and that was interesting/engaging (didn't have the right facilities, but made it work, sort of lol).¶ Taking a vehicle which I like where the ICE has given out and converting it to EV sounds engaging and appealing. Would not do it anytime soon, maybe 3 to 5 years out. Current interest level 4/5.¶ Building my own car (from scratch) would have some significant hurdles. Unless I started my own car company, which might involve other hurdles. 😉
  • Rover Sig "Value" is what people perceive as its worth. What is the worth or value of an EV somebody creates out of a used car? People value different things, but for a vehicle, people generally ascribe worth in terms of reliability, maintainability, safety, appearance and style, utility (payload, range, etc.), convenience, operating cost, projected life, support network, etc. "Value for money" means how much worth would people think it had compared to competing vehicles on the market, in other words, would it be a good deal to buy one, compared to other vehicles one could get? Consider what price you would have to ask for it, including the parts and labor you put into it, because that would affect the “for the money” part of the “value for money” calculation. An indicator of whether people think an EV-built-in-a-used-car would provide "value for money" is the current level of demand for used cars turned into EVs. Are there a lot of people looking for these on the market? Or would building one just be a hobby? Repairing an existing EV, bringing it back into spec, might create better value for the money. Although demand for EVs is reportedly down recently.
  • ToolGuy Those of you who aren't listening to the TTAC Podcast, you really don't know what you are missing.