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As the globe shrinks, carmakers such as Fiat that once were happy to dominate their home markets without competing abroad are being forced to face wider competition.
Manufacturers like Fiat, Renault and Peugeot -- which left the U.S. market decades ago after customers fled these unreliable brands for Japanese and German carmakers -- are finding those same competitors in their home markets. That is forcing them to improve their cars to the standards set by Honda, Toyota and increasingly, Hyundai.
Driving these Italian and French cars in Europe in recent years has been a revelation: They seem to be put together every bit as well as cars made anywhere else, and they often boast chic Euro-styling that sets them apart from bland Asian products.
The Fiat 500 is a case in point. The original 500, or “Cinquecento” in Italian, was the fondly remembered Italian equivalent of the Volkswagen Beetle or Austin Mini, so Fiat decided to follow VW and Mini’s lead by introducing a new version that evokes the beloved classic.
Unlike VW, which stretched the New Beetle to preposterous proportions, Fiat stuck closer to the original car’s size, producing a model that is even smaller than the Mini.
The Mexican-built U.S. version of the 500 feels as solidly assembled as the European models that have been sold on the Continent for several years, with none of the embarrassing manufacturing flaws that drove American customers away from cars like the Fiat Bravo and Strada, despite their appealing handling characteristics.
The version of the 500 I tested -- a convertible -- not only seemed solid, it also successfully repelled the drenching remnants of a tropical storm that flooded the East Coast recently. The 500’s electronics didn’t flicker during this virtual submersion test, and the car plowed happily along through the torrent without a hiccup.
With the reliability problems in its cars fixed, Fiat realized that the key to regaining customers was to focus on the company’s longstanding fun-to-drive aspect.
When the 500 debuted at the Frankfurt motor show four years ago, Fiat played up the car’s toy-like aspect with a display featuring the cars traveling on a track like an amusement park ride, with a giant-sized version of the 500’s body shell serving as the fun house through which the cars traveled.
The stunt underscores the 500’s appeal as a virtual thrill ride, but while the exterior style supports that notion, the chassis isn’t cashing the checks the sunny exterior is writing. Steering and handling fail to live up to the lively, playful promise of the 500’s diminutive dimensions.
Instead of the grasping-the-front-axles directness one expects from such a go-cartlike conveyance, the 500 driver is frustrated by lifeless power steering that feels directly lifted from an Oldsmobile Cutlass circa 1971.
For urbanites who suffer cars as a necessary evil and revel in the Fiat fashion statement, this dull steering will make no difference, as the car goes where it is pointed and the flyaway steering makes one-finger parking a breeze.
But those who are attracted by the expectation of fuel-sipping fun will be disappointed. Attempting to distract from that disappointment by enjoying the Bose sound system will only compound the problem as the radio is abominably hard to use due to the lack of rotary knobs for volume or tuning.
Story: 1969 Camaro voted best Chevrolet of all timeInside the 500 there is room for four, with just enough space behind the back seat for a row of grocery bags. It feels very much like the original Honda Civic in scale, but with a more claustrophobic cabin due to the thick bracing and small windows demanded by modern safety tests.
We don’t yet know to what degree that modern reinforcement, with the aid of seven airbags, has bolstered crash test scores because results for the U.S. model aren’t yet available. But in Europe the 500 was the first subcompact to earn a five-star rating, which bodes well for results from U.S. testing agencies.
A six-footer can genuinely fit in the rear seat behind a front-seater of the same size, though it means splayed knees, head restraint pressing against the neck and head grazing the ceiling, so the ride should be a short one.
Fiat returns to the U.S. boasting of its Multiair engine technology, which it promises will boost efficiency in its engines.
Story: Deal on a car isn't a deal if you don't like the carThe 500’s 29 mpg in combined city and highway driving is acceptable but not exemplary for a car with only 101 horsepower and six speeds in the transmission (for perspective, that means the Buick Regal eAssist has better steering feel and better fuel economy).
The 1.4-liter four-cylinder engine has a modestly thrashy character that is reminiscent of a sewing machine in the manner of Japanese engines of the 1970s. It’s in no way obtrusive, but you are aware that it is toiling underhood. When stopped at a light with the automatic transmission in drive, however, the engine does vibrate at idle.
Such details won’t matter to those for whom the 500’s aesthetic is irresistible. It has the right look, it is easy to park, comfortable to drive and turns heads everywhere it goes. If, at $25,000 (as tested, as a fully loaded convertible), it’s a touch expensive for an economy car, that may deter bargain hunters, but the fashionable set is accustomed to paying for style.
And if, at 29 mpg, the 500 isn’t as efficient as accords its size, well again, many consumers are prepared to suffer for art, and 29 mpg isn’t painfully bad, it just isn’t boast-worthily good for a cramped four-seater.
The car has been cast in some reports as a slow seller, but with only 100 dealers concentrated on the coasts, Fiat is selling 3,000 a month these days, which is solid for a niche car from a brand that has been absent for three decades.
Look for it to sustain that sales strength for a while because this new 500 successfully marries Italian flair and style with modern global requirements for reliability and safety, so it’s sure to succeed with urban trendsetters.
But for car enthusiasts, Fiat may still have some tweaking to do to dial up the fun factor.
© 2011 msnbc.com. Reprints
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At issue are funds earmarked for automakers and automotive component makers working on advanced-technology powertrains, vehicle weight-cutting technologies and other advancements that would help boost fuel economy and cut domestic dependence on foreign oil -- all while creating or saving so-called "green" jobs. A September 2008 government resolution cleared $7.5 billion in funding to be used to support as much as $25 billion in loans under the ATVM program. So far, about $3.5 billion has been distributed, meaning that more than a third of the remaining $4 billion may be in jeopardy. DOE spokesman Bill Gibbons said the Energy Department wouldn’t comment on ongoing budget negotiations.
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