Can Fiat 500 Follow In Mini Cooper's Tracks?By Karl Brauer February 17, 2011
The Fiat 500 and Mini Cooper comparisons are inevitable. Read anything about the Fiat 500, set to go on sale at 120 U.S. Chrysler dealerships this month, you'll see the words 'Mini Cooper.' According to the automotive press, and happily supported by both Chrysler and Fiat, the upcoming 500 will simply follow in the successful tracks of the Mini Cooper that landed on these shores in the spring of 2002.
It's certainly a no-brainer argument. Both cars have a long European history, are quite small by U.S. standards, and possess distinctive styling that ranges somewhere between "cute" and "cool," depending on your personal tastes. How could the Fiat 500 not follow in the Mini Cooper's footsteps? Consider what led to the Mini Cooper's success in the U.S.:
Appealing Styling - The new Mini was an extremely successful interpretation of the classic's iconic shape. It was both unmistakably Mini yet eminently modern with a near universal visual appeal.
Low Price: The standard (non "S") Mini Cooper started at $16,300 in 2002, though typical price creep (and certainly the dollar vs. Euro shift of the past eight years) has pushed the current Mini's base price to $19,400.
Premium Features: The Mini's attractive interior featured chrome toggle switches, a large speedometer and high-quality switchgear. It also could be ordered with a host of luxury features, including heated leather seats, a navigation system, a large sunroof, automatic climate control and rear parking sensors. While almost commonplace today, these features were quite rare on a compact car in 2002, making Mini one of the first "premium" small cars to be sold in the U.S.
Performance: With a base engine making 115 horsepower, the standard Mini Cooper was not quick. However, because of its excellent steering response and confident handling the car still proved entertaining to drive -- if equipped with a manual transmission (the original CVT was terrible). The more expensive ($19,500) Cooper S featured a turbocharged, 163 horsepower engine and go-kart handling, creating a truly exhilarating driving experience for enthusiasts.
Non-Traditional Marketing: Mini's marketing team threw out the 20th century marketing hand book and wrote its own, with extremely effective results. Engaging magazine ads, cross-promotional efforts with other "hip" brands, often audacious billboards dramatically elevated Mini's brand awareness without a single television commercial.
Increasing Fuel Prices: When the Mini Cooper launched in the U.S. market in 2002 fuel cost around $1.25-a-gallon, but over the next five years the price consistently went up, reaching $3-a-gallon in 2007. This gradual but consistent increase put an additional focus on small, fuel-efficient cars. Because the Mini was a small car with premium features it was viewed as a path to better fuel economy without a sacrifice in creature comforts, a combination that appealed to both young, cash-strapped buyers as well as older, wealthier shoppers that wanted to do their part for the environment.
British Icon: Before its U.S. launch Mini's own surveys confirmed that few U.S. car buyers understood or appreciated the new Mini Cooper's heritage. It was clear that, for the most part, Mini's management would be introducing an entirely new brand to this market. However, a small but passionate group of enthusiasts not only understood Mini's past, but found it quite compelling. These folks knew the car had won the Monte Carlo Rally against brands like Porsche and Ford. They also knew everyone from the Queen Mum to Peter Sellers to The Beatles all owned one at some point during the brand's history.
That was Then, This is Now
With the Fiat 500 about to hit showrooms, how does the Fiat compare?
Appealing Styling: Beauty is ultimately in the eye of the beholder, but is the new 500 as visually appealing as the new Mini? It's arguably cute, but cool? How about hip? There's no right answer to this question, but it's worth considering because (contrary to what most car buyers will openly admit), a vehicle's looks are critical to its success. It should be noted that both cars were penned by the same man, automotive designer Frank Stephenson.
Low Price: The base 500 starts at $15,500, or $800 less than the first Mini Cooper of 2002. That price includes a five-speed manual transmission, like the original Mini, but the 1.4-liter engine is less powerful at 101 horsepower than the Mini's 1.6-liter, 115 horsepower base engine from 2002. The 500 also weighs less than a Mini and should accomplish zero-to-60 in approximately 10 seconds, or about what a base Mini could accomplish in 2002.
However, if you want an automatic transmission (as most U.S. buyers will), a base 500 with no other options will cost $17,000, including destination charge. If you step up from the base 500 ("Pop") to the mid-level "Sport" model the price jumps to $17,500 ($19,000 with automatic and destination charge). Above that is the "Lounge" starting at $19,500 ($20,000 with destination), a price that includes the six-speed automatic. While the Lounge adds luxury features, and the Sport gets a tighter suspension and larger wheels, neither model offers a larger or more powerful engine.
Furthermore, at $19,500 the Lounge trim costs as much as a new 2011 Mini Cooper, though it is better equipped. A current Mini Cooper has 121 horsepower and standard six-speed manual transmission (automatic add $1,250). It's likely today's base Mini will outperform the Fiat 500 in any trim, even with the Mini's higher curb weight.
Premium Features: The 500 will be available with many of the same premium features offered on the Mini Cooper and every other compact car in 2011. As stated earlier, the Mini's assortment of premium features made it a truly unique package in 2002. Nine years later, items like a navigation system, heated leather seats and a large sunroof aren't nice-to-haves, they're essential to a large percentage of buyers shopping this segment. By offering them the 500 doesn't stand out, as the Mini did in 2002, it merely meets today's small car requirements.
Performance: As previously stated, the 500 will make less power than a base Mini while offering a five-speed (versus the Mini's six-speed) manual transmission. The 500 will likely be slower than a Mini, but just as critical are the handling dynamics. Even the base Mini set a high bar in this regard. Will the 500 match it? Probably, but until the Abarth version of the 500 arrives in early 2012 there won't be anything from Fiat to equate to Mini's performance-oriented Cooper S (a model Mini introduced simultaneously with the base Cooper when the brand launched in the U.S. in 2002). However, there will be a convertible 500 in the spring of 2011.
Non-Traditional Marketing: It's entirely possible Fiat will launch a brilliant marketing scheme to raise awareness and excitement for the 500. Ford's Fiesta Movement proved a bit of innovation and risk can net a large reward. There are far more communication tools at Fiat's disposal today than Mini had available in 2002. We'll see what they come up with, but considering how close we are to the 500's launch it's reasonable to assume we'd have seen some activity in this area already. Mini began an aggressive marketing campaign months before the car arrived in showrooms. Who knows, maybe someone will make a new Italian Job movie that actually features an Italian car this time.
Increasing Fuel Prices: Except for the price spike in the summer of 2008 fuel prices have been relatively stable at $3-a-gallon for the past four years. This has led to an increase in large truck and SUV sales in recent months while small car sales have stagnated or decreased. Despite all the hype over Leafs and Volts in recent weeks this is a tough market for any car touting its compact size and fuel efficiency. However, fuel prices have crept up in recent months. If that trend continues it will put more emphasis on small cars like the 500 and could drastically improve sales.
At the same time, several new models have been introduced in recent months, including the Chevrolet Cruze, Ford Fiesta, Hyundai Elantra, Mazda 2 and Toyota Scion tC. And don't forget an all-new Honda Civic arrives in the summer of 2011. The 500 will be entering the most competitive small car market in the history of the segment.
Italian Icon: If Mini had a small-but-dedicated fan base in the U.S. when it launched, the 500's fan base could accurately be described as tiny. Fiat's history is more controversial in this country than Mini's, and the 500's association with pop-culture figures is nearly non-existent. Very few American's knew Peter Sellers drove a Mini when the brand launched here in 2002. But try to find any American who can associate a Fiat 500 with well, anyone.
Time Will Tell
Ultimately only time and the U.S. market can determine how successful the 2012 Fiat 500 will be when it arrives. Mini launched with 80 U.S. dealers (the brand now has 95) and has averaged just under 40,000 sales a year since 2002. With 120 dealers offering the 500 for a theoretically lower starting price (though few of the initial 500s will be base models with manual transmissions, priced at $15,500) Fiat is hoping for 50,000 annual sales.
The recent failure of the smart brand, at least under Penske's watch, is clear proof a small car with European ties doesn't guarantee success in the U.S. market. The 500 appears far better executed than smart's twofour. For instance, it has an effective automatic that doesn't make passengers nauseous. If the fledgling Fiat dealer network can meet both initial sales and after sales demands (i.e. customer service) the brand could theoretically hit 50,000 in annual sales.
Mini Cooper, Part 2? Maybe.