Bigger Car, Bigger Stakes As Fiat Unveils 500X At Paris Show – Forbes

Posted: Wednesday, October 01, 2014

As he introduces the Fiat 500X this week at the Paris auto show, Fiat brand CEO Olivier Francois will have a huge stake in the success of one of the largest modern Fiats. And as he worked on his speech recently in preparation for the unveiling, Francois didn’t back away from the importance of the vehicle that will share underpinnings with the new Jeep Renegade and will be built on the same production line in Italy.

“The name of the game is growth,” Francois told me at Fiat Chrysler U.S. headquarters in Auburn Hills, Mich., “and with this car, we grow in size and in ambition. Why? Because we want to grow in appeal of the Fiat brand — appeal to more people in the United States. We’ll be going from small cars and those that are ultra-small for the U.S. market to one that potentially appeals to lots of Americans.”

Indeed, it’s hard to understate the importance of the 500X to Fiat in the United States, where it will debut next spring after initial launch in Europe. Fiat sales have climbed resolutely if not spectacularly in the American market since the merged company reintroduced the once-sunny Italian brand to the United States in 2011. Sales of the new 500L somewhat have offset a slump in the basic 500 for the year to date through August, when total Fiat brand sales were up 9 percent compared with a year earlier.

As Francois observed, Fiat sales of about 60,000 units a year in North America already have given it about a 60-percent share of the tiny-car market that also includes Mini, Smart and others. After a year, he said, Fiat had achieved the same U.S. sales volume as Kia required five years to achieve and that Mini couldn’t reach until its seventh year in the market. Meanwhile, he said, Fiat already “over-indexes in share of mind and share of attention in the U.S. and totally over-indexes compared against its share of market, its share of advertising and share of voice.”

“But it still just occupies a niche,” Francois allowed. “We’re doing well but we’re clearly limited by the product concept and package.” The Fiat 500 and 500L “are never going to be the main car of a household, but will be a second, third or fourth car in a family.”

And Francois and his associates want so much more for the brand. Their goal is to transform Fiat gradually into a broader small-car brand in the United States just as it is a staple in the European market, to become a substantial and yet fun presence in that crucial segment in America while Chrysler expands into a more substantial middle-market force and Fiat Chrysler’s other brands crowd their own newly refined spaces. The 500X, a small crossover with a hatchback and offering 4×4 capabilities, is being counted on to start moving Fiat in that direction.

“The 500X is a potential main car,” Francois argued. “This is finally a Fiat that can be mainstream, with the roominess and space and powerful engine that is required. We just have to do this without losing the fun and the edge of Fiat. We can’t switch off the fun and sexy persona and go super-mainstream or boring.

“That’s the mission. We don’t want Fiat to lose its edge.”



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