Is the 500L the hit Fiat needs to boost sales?

FIAT IS IN BAD need of a big hit. Hmm. I seem to have written those words before, five years ago, just before the Italians launched the little 500, the sales of which pulled the company back from the financial abyss.

Now, though, while the abyss is not so deep and Fiat is not teetering on the edge of it, sales are falling in its European heartlands, and, with investment being reduced and factories being shut down, Turin needs a new sprinkling of the 500’s magic.

And the 500L is the car Fiat hopes will revive its European fortunes. Although it carries the 500 name it’s only distantly mechanically related to the chic city car. It’s a 4.15m-long MPV, styled to look closer to an SUV and with a huge cabin for stuffing your family into. When they said the L stands for “large”, they really weren’t kidding. The 500L towers over a tiny 500 hatch, and there’s enough space for a six-footer to do some genuine lounging in the back seats.

That the cabin also looks and feels of very high quality indicates that Fiat is still pushing well along the road to eradicating its old reputation for fragility, however difficult it may be to unstick that impression from Irish minds. All the interior surfaces have a pleasingly hefty yet silky feel, and, as long as you specify some of the brighter colour options, it feels like a warm, welcoming place to be.

Irish specs have yet to be decided (and a price of about €22,000 for the 1.3 MultiJet diesel model has still to be agreed), but there will be an awful lot of high-end optional extras, including a city safety self-braking setup, a 1.5m-long glass roof, a stereo designed by the hip-hop legend Dr Dre (ask your kids . . .) and even an in-car Lavazza espresso maker that slots into one of the cupholders.

Standard features include a 5in touchscreen infotainment system with Bluetooth connection for your phone and music player and an EcoDrive Live function that monitors your driving and admonishes you for being too profligate – and that Fiat claims, somewhat implausibly, can save you up to 1,200l of fuel over the life of the car.

The rear seats fold and tumble with a quick flick of a button, and the 400l boot has an adjustable floor that allows you to segregate the shopping from the peat briquettes, or perhaps the laundry from the wet dog.

Our test car has the 85bhp 1.3 MultiJet diesel, which has a 110g/km CO2 figure and better than 62mpg on average. But with only 200Nm of torque to haul around 1,300kg of 500 (and that’s an empty kerb weight) it struggles to do anything to excite.

It’s a decent engine, with good refinement but little verve, and a rubbery five-speed manual gearbox doesn’t help either. When the 500L arrives in Irish dealers at the end of the year a 105bhp 1.6l diesel should be available, and that will doubtless prove a better match. Petrolheads, if any remain in Ireland, might be enticed by the 105bhp two-cylinder 112g/km TwinAir engine.

To drive, the 500L feels fine, but it lacks the quiet stolidness of a Skoda Yeti or the pin-sharp steering of a Mini Countryman. It’s competent, capable and has nicely weighted steering and a good if occasionally bobbly ride quality, but there are few causes for complaint here. Like the engine, it’s safe but not really engaging.

Stylewise it tries to take 500 design cues and inflate them to a much bigger size, which, as Porsche found trying to translate a 911 coupé into a Cayenne SUV, isn’t entirely successful. It looks good in certain colours, odd in others (beige is an especially bad choice) but is certainly distinctive and different.

It’s the cavernous cabin that really sells the 500L. Families will love it for its space, brightness and adaptability. Fold the front seat flat and you can fill the 500L with Ikea flatpacks and still have space left for a driver and rear-seat passenger, and kids will have no trouble at all in filling the 22 interior pockets and cubbies. That it seems on this encounter to be robustly built will mollify the worries of their parents.

The 500L’s sales prospects in Ireland depend entirely on whether enough Irish buyers are willing to look past their old prejudices about the brand. Nissan proved with the Qashqai that this was a serious possibility, and who, a few years ago, took Hyundai or Kia seriously? Those willing to suspend disbelief long enough to try a 500L will find it an engaging proposal.

PRICE €22,000 (TBC)

OUR RATING 6/10

A convincing expansion of the 500 family, but doubts remain that it’s sufficient to bring buyers back to Fiat

FACTFILE

ENGINE1,248cc four-cylinder diesel engine; 85bhp @ 3,500rpm; 200Nm of torque @ 1,500rpm

PERFORMANCE0-100km/h 14.9 seconds

ECONOMY4.2l/100km (67.2mpg)

EMISSIONS110g/km (€160 motor tax)

FEATURESStandard features include 5in touchscreen, Bluetooth, stability control with hill holder and rollover mitigation, three-tier boot floor, fold-and-tumble rear seats

RIVALSSkoda Yeti 1.6 TDI Active – €24,274; Nissan Juke 15 dCi Sport – €22,845; Citroen C3 Picasso 1.6 HDI VTR+ – €20,850; Kia Soul 1.6 EX Diesel – €19,820

Fiat faces European plant closures as buyers turn to Germany and Korea

While the 500L is generating hoopla and solid reviews, Europe is becoming a big headache. Sales in almost all European markets are either flat or declining, and Fiat’s sales in particular are suffering. With 5,000 mostly white-collar Fiat employees facing temporary layoffs, Fiat boss Sergio Marchionne is warning that another of Fiat’s European plants may have to be shuttered.

Last year Fiat closed its plant in Sicily, even as it expanded its (former Yugo) factory in Serbia to build the 500L. Now, says Marchionne, unless cars can be exported to Fiat’s newfound US markets, another European plant is under threat.

“If that is the demand in Europe, there is at least one extra car plant in Italy,” Marchionne told Bloomberg. “If we manage to utilise the capacity to export to the US, this issue will disappear.” Part of this is doubtless posturing to put pressure on Fiat’s unions, with which Marchionne is negotiating to get better work-practice deals, but with the European car market showing no signs of recovery, the future looks ominous.

One Fiat insider said: “Fiat and Chrysler are now, effectively, one unit, so the fact that losses are being posted in Europe (Fiat lost €207 million in the first quarter of 2012) doesn’t really matter because Chrysler will be bringing in €3 billion in profits in 2012.”

It matters enough that Marchionne has announced a €500 million investment cut for Fiat in Europe and cancelled, for now, a new Punto hatchback, once considered an all-important model. Savage discounts and the dead market are being blamed, and Marchionne says he sees no sign of a recovery for at least two years. Despite this, €1 billion has been invested in the new 500L and upcoming variants; a seven-seat version and a 500X 4x4 crossover, which will form the basis of a compact Jeep model.

In Ireland, Fiat will launch the 500L at the end of this year, but it must first go through a restructuring process that will see job losses from the HQ on Naas Road in Dublin.

Conor Twomey, Fiat Ireland’s marketing and communications manager, gave an indication of what will become of Fiat Ireland. “The process is ongoing. We’re still thrashing out what we can realistically take on board with less to work with, with a smaller staff and with financial constraints. It’s a tough time, but Fiat is 100 per cent committed to the Irish market. What will emerge will be a leaner, fitter, more adaptable company, which we believe will allow us to target our customers better and to use more concise model ranges.”

Over the past decade Marchionne’s steely determination and strong sales of the 500 turned the firm around and allowed it to rebuild and even become strong enough to rescue the ailing Chrysler. Now it’s the US firm that’s Fiat’s profit engine. Fiat’s USPs of compact models and low emissions should be a winning combination even when the market is bad, but buyers in Europe and, especially, Ireland continue to desert the Italian giant in favour of German and Korean competitors. Can Marchionne turn things around again or is Europe destined to become a backwater for Fiat?

Fiat’s research and development chief, Guglielmo Caviasso, said: “It’s clear that Fiat and Chrysler are looking at global markets . . . We’re getting close to single-market needs. To offer those models in a short development time is what’s most important from an R&D standpoint.”