Stellantis Faces Major Setback with the New Fiat 500
Stellantis Extends Production Pause for Fiat 500
- Stellantis has decided to extend the production pause for the Fiat 500 due to low demand.
- In September, the company paused production due to disappointing sales, with plans to resume on October 11.
- However, production will now not resume until November 1.
Stellantis is facing a challenging period, with plummeting sales of its Dodge and Jeep brands in America, and similarly underwhelming performance from its overseas brands. Adding to the company’s woes, Stellantis has announced that it is extending the suspension of production for the all-electric Fiat 500 until November 1, due to low demand.
The Fiat 500’s production was originally halted on September 12, with the intention of idling the Mirafiori plant in Italy for a four-week period. This stoppage has now been extended by an additional three weeks.
Trouble in the Electric Car Market
According to a statement made to trade unions, Stellantis claims that the electric car market in Europe is currently facing significant challenges.
Although production of the Fiat 500 has been temporarily paused, the vehicle is not being discontinued. Stellantis has announced plans to invest more than $110 million into the car over the next two years, with funding allocated to develop a gas-powered hybrid version scheduled for release next year. This decision to introduce a hybrid model reflects changing market dynamics and declining demand for purely electric vehicles.
By way of context, Stellantis only sold 470 Fiat 500s in the United States during the first half of 2024. In its best sales year of 2012, the previous generation 500 achieved sales of 46,999 units. Even in 2020, after the model had been discontinued for the North American market, Stellantis managed to sell 674 units.
Exploring the Lack of Demand
The lack of demand for the Fiat 500, particularly in the US, is understandable. The 500e offers just 149 miles of range and has a starting price of $34,095. Clearly, these figures do not appeal to American car buyers. For the same price, buyers can opt for an electric Hyundai Kona, which offers significantly more space and an additional 120 miles of range. The Fiat 500 simply cannot compete in this market.
While the introduction of a gas-powered version is a step in the right direction, it may be too little, too late for Stellantis, given the recent string of negative news surrounding the brand. Hopefully, the company can find a way to turn things around and climb out of this hole it has dug for itself.