Fiat and Jeep plot new Nissan Qashqai rivals as Fiat abandons its mass-market hopes

Fiat Chrysler Automobiles (FCA) is poised for a European market relaunch that will see the Italian brand abandon its mass market positioning and Jeep exploiting the booming market for SUVs of all sizes.

The first fruits of Fiat’s new brand positioning was the 500X compact SUV, accompanied by its Jeep sister car, the Renegade. Autocar can also reveal that the two brands are working on a pair of larger SUV models based on the same high-end platform.

The quirky Jeep Renegade gets put through its paces on our thorough road test

At the recent Geneva motor show, FCA boss Sergio Marchionne said Fiat would no longer attempt to be a “mass-market brand” and would not attempt to offer a “full range” of models. He added that Fiat would “focus on what it does best”.

In extracting the best from what remains of the Fiat brand - combined Fiat and Abarth sales reached a modest 600,000 units last year - Marchionne and his team have devised a four-pronged plan.

The biggest growth areas in the European market are the SUV and premium sectors, probably followed by smart city cars and budget models.

The premium sector will be addressed by the reinvention of Alfa Romeo and, to a lesser extent, rising sales and new models from Maserati.

Fiat is already very well placed in the market for characterful small cars with the 500 line-up. The 500 hatchback and the bigger 500L MPV are both segment leaders in Europe, and Fiat’s main challenge will be to maintain and progress the success of the 500 family.

Fiat will attack the SUV sector with the new 500X and the upcoming Nissan Qashqai-sized SUV. These models will be made profitable because they will share components with and be built alongside a pair of Jeep sister cars.

Additionally, the sophisticated platform underpinning the new 500X and Jeep Renegade can be scaled for use on the bigger Fiat and Jeep models.

Farther down the line, Fiat and Jeep may launch a truly baby SUV into the European market. The model would be around the size of a supermini, according to global Jeep boss Mike Manley. The move could result in today’s Fiat Panda Cross being replaced by a pair of Fiat and Jeep SUV models.

With the small and medium SUV market covered by Fiat and Jeep, Marchionne’s plan then takes an unexpected turn into a new niche.

Although Europe’s Volkswagen Golf and Ford Focus-sized C-segment accounts for a substantial 29% of the new market, profits are wafer thin, if they exist at all.Most analysts think the situation is caused by a combination of intense competition, high labour costs and increasingly generous standard specifications as the mainstream brands chase the sector-leading Golf.

Marchionne, according to sources, will counter these hurdles by launching a back-to-basics C-segment hatchback and estate, replacing the unsuccessful Fiat Bravo. These will be based on the same platform as the 500L MPV and will be built in Turkey, where labour rates are cheaper.

Insiders have told Autocar that the new models will not be as “basic” as Dacia’s successful models, but will be “very well priced”. Some rumours suggest that Marchionne will use the well-regarded Panda badge for the Bravo replacement, neatly rebuilding the Panda family as Fiat’s no-nonsense sub-brand.

Even under Marchionne’s rigorous approach, the Fiat brand will get a ‘halo’ model. The car that started life as Alfa Romeo’s version of the new Mazda MX-5 will now be sold as the Fiat 124 Spider, a reference to the classic Pininfarina-designed roadster that was sold between 1966 and 1985.

Meanwhile, the Jeep brand has been tasked with ‘going global’ over the next few years. The brand sold just over one million units for the first time last year, but 76% of the sales were in the United States.

Mike Manley, overall boss of the Jeep brand, says the company sells just 8% of its vehicles in the EU and a similar proportion (around 89,000 units last year) in the Chinese market.

Manley wants Jeep sales to rise significantly in these markets. To this end, Jeep will open two factories in China in the next two years, while a new manufacturing plant is also coming on stream in Brazil.

The Renegade, which Manley says is selling “ahead of expectations” in Europe, will also be exported to the United States, although it won’t be sold in China. It’s thought the annual global market for B-segment SUVs such as the Renegade will be as high as two million units by 2019.

The next new global Jeep product will be the Qashqai-sized SUV. It will be launched in 2016 as a replacement for the Patriot and Compass models and will form the core part of Jeep’s expansion.

Manley also revealed to Autocar that Jeep would aim at the highly profitable premium SUV market with a new Grand Wagoneer in late 2018. At the other end of the scale, Manley said the brand was actively pondering a supermini-sized SUV. “Never say never,” he said.

Strength and sophistication under the skin

The platform underpinning the Fiat 500X and Jeep Renegade is impressively sophisticated. It uses front and rear independent suspension with MacPherson struts in each corner - a feature shared with Porsche’s sports cars.

The four-wheel drive system is unusual. Engineered by GKN, it uses an electronically activated coupling to send power to the rear wheels, rather than the hydraulic clutch used by the common Haldex-based all-wheel drive systems.

The structure sitting atop this running gear is also impressively strong; the Jeep Renegade was awarded five stars in recent Euro NCAP crash tests.

Read our full review on the Fiat 500X SUV

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Our Verdict

Fiat 500
The Fiat 500 is a small, cheap, utilitarian car that has become an icon

The Fiat 500 is a deserved success story for the brand, offering bags of style, a fine drive and low costs

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Comments
12

20 March 2015
So, the Fiat 500 is built in Poland, The next Brava in Turkey, The 124 in Japan, The Jeep range in USA, and all taxes are paid through Fiat Luxembourg! The plan for reinvigorating Fiat group appears to be entirely based on not doing anything in Italy (except low volume Alfa, Ferrari and Maserati).

20 March 2015
I am not sure if everyone feels like me but ever since Macaroni face ( Marchionne ) got his hands on this lot NOTHING good has happened to any marque, but he has managed to line his pockets and set things up in politics for his future - God Help Italy -. Yes I dont like the guy because like Nixon before him - I wouldnt guy a NEW never mind 2nd hand car from him. Fiat - has NOTHING of importance to offer. The Panda was good because it borrowed from Suzuki - the rest was terrible. Alfa have lost their way which is a crying shame, Massa is around but needs a serious designer to bring back a proper mojo and as for the yankie side of things I wouldnt touch a Jeep with a barge pole.

what's life without imagination

20 March 2015
5wheels wrote:
I am not sure if everyone feels like me...
I hope not. 'Macaroni face'? What are you, a five-year-old Nigel Farage?

23 March 2015
5wheels wrote:
I wouldnt guy a NEW never mind 2nd hand car from him. Fiat - has NOTHING of importance to offer. The Panda was good because it borrowed from Suzuki - the rest was terrible.
Panda was good because it borrowed from Suzuki? Eh? Anyways... the 500 has clearly been an important car for Fiat so to deem them with "nothing of importance to offer" just seems false.


"Work hard and be nice to people"

20 March 2015
So, Fiat will abandon the mainstream C-segment hatchback market, where margins are wafer-thin, and instead offer a not-quite-back-to-basics C-segment hatch and estate, which will be be a bit better equipped than a Dacia and not quite so cheap? Yeah, that's bound to improve margins! Seriously, that looks like a terrible plan and reminds me of Citroen's pile 'em high, sell 'em cheap approach of the late '90s, early '00s. Is there actually a micro-niche Between Dacia and the mainstream, given the discounts available on many mainstream models? Moreover, the Fiat brand will encompass a "budget" hatch and estate, the "retro" 500 models, some SUVs and a "halo" sports convertible. That won't cause any confusion amongst potential customers! The 500, launched eight years ago, is to be "facelifted" next year, with no timescale for a replacement, which is pretty brave for a model that sells on its looks rather than practicality. Finally, putting so much emphasis on SUVs may be a good bet, but it looks like a pretty risky one, given the fact that Fiat are very late to this particular party.

20 March 2015
"The Renegade, which Manley says is selling “ahead of expectations” in Europe, will also be exported to China, although it won’t be sold in the United States. It’s thought the annual global market for B-segment SUVs such as the Renegade will be as high as two million units by 2019." Any hack should know that this statement is wrong! They have been lining it up in the states for months. So which other bits in this report are not correct.

20 March 2015

Sorry, you are right. The Renegade is going to the US, but not to China. Back to front. I'll amend this.

20 March 2015
"Fiat would no longer attempt to be a mass-market brand" as I've been saying for some time RIP Fiat. That's Rust in Peace by the way. Anyhow I wonder how much of the Ferrari's F1 teams decline over the last few years has been down to cut backs from Fiat funding. I read a little while ago Fiat were cutting back on their stake if not all their stake in Ferrari so it'll be a big injection of much needed funds and who knows maybe Ferrari will be owned by the Chinese.

 

Hydrogen cars just went POP

20 March 2015
It is quite incredible that Sergio has said Fiat would no longer be a “mass-market brand”. Fiat at one time, was the mass market brand in Europe. The Punto was number 1 in the charts and the 1st gen Bravo/a seemed everywhere. Can't believe they have given up more or less. And what happens when the 500 craze cools?

23 March 2015
AndyT wrote:
It is quite incredible that Sergio has said Fiat would no longer be a “mass-market brand”. Fiat at one time, was the mass market brand in Europe. The Punto was number 1 in the charts and the 1st gen Bravo/a seemed everywhere. Can't believe they have given up more or less. And what happens when the 500 craze cools?
Well the 500 craze has been continuing for 7 years... and it doesn't show any sign of letting up if the sales charts are anything to go by. And that's without a facelift. I would agree though, that it's a shame for them to have ditched their confidence in the Punto, a car that was once a strong competitor. The Mk2 models still look good. They can't ditch these small markets altogether - because that, contrary to Mr Marchionne's belief that they'll focus on SUVs, has always been their strongest sector. I do think the UK were too cautious though, when the Multipla was launched. That was widely renowned as being one of the most innovative and best-driving cars of that decade. A pity people couldn't see past its characterful looks.


"Work hard and be nice to people"

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