Fiat plans new European attack

Fiat will split its line-up into Emotional and Rational families

Fiat range to be divided into 'Emotional' and 'Rational' arms, with a new 124 Spider planned to join 500s in Emotional family

Fiat Chrysler Automobiles will split its Fiat brand into two distinct arms as it plots to revive the company in the competitive western European car market.

Fiat’s product planners have decided to exploit two areas in the European car market that are showing strong signs of growth: near-premium small and compact cars and high-value budget cars.

Fiat’s Luca Napolitano, who is head of the Fiat brand for Europe, the Middle East and Russia, has been quoted as saying that the two new arms are known as ‘Rational’ and ‘Emotional’.

The Emotional family covers the expanding 500 range and the upcoming Mazda MX-5-based Fiat 124 Spider. The significant addition to the 500 range will be a larger five-door hatchback model, which will be based on the same platform as the 500X crossover.

This new car is expected next year and Fiat will pitch it as a direct Mini rival that offers more space. All-wheel drive and powerful turbocharged versions are also under development.

Napolitano said Fiat’s Rational  line would be “based on functionality and value for money”. The Panda (which will be replaced in 2018) will make up the entry-level models. They will be joined by a new B-segment supermini — in effect, a reborn Uno — and a new family hatchback and estate that are based on the Aegea budget saloon.

Fiat’s own internal presentation says the new Rational B-segment model will be launched next year.

There’s no news yet on what the bigger models will be called, but Grande Panda or Grande Punto are thought to be in contention.

Although Fiat will reveal more about this new line-up at the Geneva motor show next March, it’s understood that the C-segment hatch and estate will not be as cheap as Dacia models but will undercut mainstream rivals from the likes of Skoda and Hyundai-Kia.

The Aegea platform has been developed in Turkey over the past three years, mirroring Dacia’s approach of completing much of the engineering in a low-cost country, Romania in Dacia’s case.

According to an official investors’ presentation by the company, Rational Fiats will be built in just one trim level, with the choice of two engines and just four exterior colours.

This suggests that luxury upgrades such as sat-nav or a higher-quality audio system will be installed by the dealer. Showroom prices will also be fixed and Fiat may opt to retail these cars online.

Such moves look to leverage Fiat’s historic advantages of being a brand built on a reputation for characterful and highly regarded small cars such as the Uno, Brava, Punto and Panda - all of which became European Cars of the Year.

This new plan should boost the Fiat brand, which has suffered a collapse in its sales and market share during the past two decades.

In 1997, when the first-generation Punto was at the top of the sales charts, the company sold 1.272 million cars in western and central Europe and achieved a market share of 9.44%.

For almost 10 years from 2001 on, sales hovered approximately 100,000 either side of the 900,000 mark. However, after achieving 837,000 sales in 2010, Fiat sales collapsed to just 583,000 and a 4.5% market share.

The good news for the Italian firm is that 2015 is proving to be something of a turnaround year for the brand, even before the new two-family plan has been established.

At the end of June, the 500 and Panda accounted for a near-28% share of the A-segment between them and the 500L was number one in the small MPV segment, with a market share of 24%. The 500X has also had a strong start to the year, with around 37,000 units sold during the first six months.

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