Laura Soave Out as the Head of Fiat in the U.S.

I guess she's the sacrficial lamb for Sergio's overblown sales expectations for this car. Just like the Smart, there is an initial demand then the market tanks. Once the must haves get their cars, the 500 has to compete in a very competitive market against cars like the Fiesta, Fit, Versa etc. Did anyone seriously think Fiat could sell 50K of these cars in our market?

There is a lot we don't know here. There were obviously problems with dealerships coming on line, who knows why, maybe poor planning. Add to that the poor marketing, somebody had to take the blame.

Frankly it's a good example of the people who claim that no executives take responsibility for a company's screw ups. It is one of the only milestones sergio set that hasn't been met, so something had to change.

While I have some sympathy for her, it's not her fault (I presume) that Chrysler thought it made sense to establish a separate dealership network for a one model brand. However, I presume she was in charge of the J Lo campaign, which is guaranteed to keep young men out of Fiat showrooms in droves.

She allegedly relationship with the head of the marketing company she picked to launch the car. Was that ever proven/disproven?

"I presume she was in charge of the J Lo campaign, which is guaranteed to keep young men out of Fiat showrooms in droves."

Exactly. Want to alienate maybe over half your potential customer base? Then market the car as a chick car. What a disastrous move.
For better or worse, women have no problem buying a car targeted at men, but men (straight men) do have a problem buying a car targeted at women.

@desmolicious: Not just straight men, we are talking about YOUNG straight men. The older one gets, the less this has any meaning. Mature adults buy the car they want, not the car that "they say" you shouldn't buy.

There are many reasons why I would not buy a 500, but none of them are related to my sexuality or gender.

Requirement to have a separate, stand alone channel for FIAT is the single biggest problem with dealerships "failure to launch".
$3 million is a lot of capital to risk on a single model when you have genuine reason to take a "wait and see" attitude to how Chrysler/Jeep/Dodge will perform on your existing investment.

Procrastination is looking pretty good right now for dealers that did not open.

Allegations of impropriety did not help Laura, poor sales are what determined her fate.

ed: I agree. At 46 I would be interested in a 500 despite the JLo ad. However, when I was in my early 20's, those ads would most certainly have sold me on the 500 being a "chick" car and I wouldn't have gone near a Fiat showroom, sorry studio.

Maybe if the Abarth was available you could position the base 500 that way, but without the overt performance version, Fiat just established the 500 as the modern New Beetle, a 'cute' car for girls. This is particularly ironic now that VW is trying (sucessfully I think) to eliminate the 'chick car' stigma from the Beetle in order to boost sales.

Mini has done a masterful job of selling to men and women, but then it also had the S version available from day 1.

You would think the company that owns Ferrari and Maserati would be able to walk this line better.

I've dealt with an Italian company that has always had overly high expectations of the US market, made problematic by their lack of investment to get the business. From what I can tell, the same thing is playing out with Fiat and the 500.

I do think they (whether it's Fiat branded or Dodge/Chrysler should easily be able to sell 50,000 500's per year - but they have to market to the audience they really want to buy the car. Using J Lo for some soft sell ads was DUMB. Sell the Italian connection, design, sportiness, etc. This debacle is EXACTLY what I went through with the Italian mill I was trying to help. They would spend huge amounts of money to market their products in their own market, telling the story that made sense, but here in North America, they just expected people to buy their products...because. When they didn't sell enough, it was always the sellers fault and reason they didn't invest money trying. Quite the self fulfilling prophecy.

I hope they can figure out a way to push Fiat forward here. Invest some more money, make more of their cars US / Canada and European compliant (as much as possible) and start selling more than just a single product here.

The Fiat 500 is the wrong car for the reintroduction of the Fiat brand, IMHO. It is a small niche market with very few followers and interest, other than J. Jo's commerical which generated quit a stir for Fiat, the car itself is just avg, too small to be useful as a primary car and too expensive, IMO, to be a commuter...With today's economy, most family can't afford to just buy a second commuter car or even a fun car to drive around on the weekends; remember those days? It wasn't that long ago that many of us have a weekend fun car to drive around...We'll see how this reintroduction of the Fiat brand fans out in the next six months. If they don't bring in something more substantial and "useful" they can forget about it!!

I few issues here.
1) Fiat was widly optimistic with projected first year sales.
2) For most of the year until other dealerships opened the dealer count was about 60.
3) The Fiat 500 is about a grand overpriced based on it's size and performance
4) Suave would have been responsible to marketing the car using J-Lo. This cut off a bunch of
the young male population.
5) The was information that Suave was having a relationship with the head of the marketing firm she was promoting.
Saying all this. The 500 is not a bad car. It rides better then a Mini and is slightly more comfortable to ride in. It needs the following: Primarily more power in the base version-Say 115 HP-Check out what road race motorsports has done. Also it needs different and better marketing. A little machismo needs to be infused into advertizing. The new Abarth should be played up this way. The base car needs to be discounted or start from a lower starting price.

"Mini has done a masterful job of selling to men and women, but then it also had the S version available from day 1."

That's because all they did was focus on the car, how unique and fun it was to drive and they did not use any celebs to push it.

Let's say that using a celeb is a way of selling the car. Then at least use a celeb that has the same Italian heritage, a connection to the homeland. Something that makes sense.
Like using the likeness of Anthony Quinn, Sofia Loren with the original 500, 'meeting' the new hotness in Italian men and women in the new 500s.

Sell up the style, the heritage, the fun, the attitude.

Using an ex Fly girl from In Living Color? Wrong.

Too much J Lo!

Two problems. The JLo campaign is a huge mistake. Chrysler killed the Pacifica with Celine Dion and they may do the same with the Fiat. You should never put a pop star who had her biggest hits more than 15 years ago in your car commercial. Second problem is inflated expectations. With brand recognition that was either negative or non-existant, exactly how could they expect to sell 50,000 cars. They have not done that badly given that the model is all new in the market and most people wouldn't know where to go to get a FIAT if they wanted one. Now it's their job to fix these problems. The Abarth ad is a great start. Next step is to generate some awareness around the dealer network.

The only way to have made the 500 palatable to young, non-gay males would've been to have had a performance variant to take on the Mini Cooper S, such as the Abarth, from initial introduction. They could've marketed the cutesy convertible or lower trims to chicks and meterosexuals and the performance models to guys.

According to these guys, it's quite likely that Soave was NOT responsible for the JLo thing. If true, she's just a fall girl.

http://www.thetruthaboutcars.com/2011/11/ask-the-best-and-brightest-who-killed-the-fiat-500/

The directive to open FIAT-only dealerships was also a bit silly, with just one low-margin model in a segment that isn't big to begin with. Though someone's going to have to explain to me just how MINI managed to do so well. I know they had it easier, and the car is better in some key ways (not all), but what exactly did they do that FIAT didn't?

Soave WAS responsible for Lopez travesty, the wild 50K target and the dealer snafus, why? Because she was in charge of everything as the head of Fiat North America.

Epic. Fail.

It's as simple as that.

Marketing will only get you so far, Fiat has to provide some real value relative to the competition. They should bring in a diesel engine car at $18,000 which will undercut VW by $5Kish.

Then they should promote the hell out of the Abarth version as having your scorpions on the car is the best way to unchickify it.

Cy

I think Marchionne still does not understand the North American market, and it is him and not Soave who had big expectations for the 500. I don't know how is doing in Canada, but in Mexico sales are also very slow because it is too expensive compared with the Nissan March, the Hyundai I10, and the Chevrolet Spark that are selling well.

I believe the Spark is going to be a though competitor in the US, in particular, if it starts around $12k.

Reasons why the Fiat 500 failed:

1. $18,000 as a base price for a small car is way too much.
2. 101 hp? Seriously?
3. Too cute for guys. Yet too ugly for girls.
4. Too small to be practical.
5. Too thirsty to be economical.
6. No performance.

Americans don't want expensive small cars with no practicality, zero performance, controversial looks, and average fuel economy. The Fiat 500 may be a big hit in Europe, but it failed miserably in the US.

This is the land of big SUVs and pick-up trucks. If you're going to sell a small car here, it needs to be cheap, fun, economical, practical, and handsome to both men and women.

She's hot in that pic above but I just googled her and she looks totally different. Bummer.

@ tqpolo

did the exact same thing...agreed.

My wife and I considered the Fiat as a commuter, but we decided against it based on unknown reliability. How will it hold up through a Canadian winter? Will it start after sitting at the train station all day in -20C weather? Just too many unkowns about the car.

Gawd, just look at how smug she looks in this video still... -.-

I completely understand the failure of the FIAT brand. Even under the best of circumstances this car would not even come close to 50k a year in sales.

This car should of been branded as the Chrysler Fiat 500 from the beginning, No need for a new dealer franchise, new brand development, new parts network, sales team etc.

If the Chrysler Fiat 500 had a successful launch, and doing some consumer research indicated that Fiat has enough brand power with the right products - to go on its own, then go for it. Until then, run parallel under Chrysler.

I believe Sergio has done a great job with getting Chrysler out of its darkest days. Other then Jeep and Ram brands, you can only put lipstick on a pig for so long (200, 300). He needs to focus on bringing in the right products, not so much as establishing FIAT in the US again.

Just saying...

Big time disagree with a lot of these comments. The Fiat 500 is not competing with the Honda Fit, Mazda 2, Nissan Versa or their ilk. It's sole target is the Mini Cooper, and it actually does quite well at that - it's similar in performance, utility, style, heritage, and undercuts it by a decent margin on price. It's no worse an econobox than the Mini, but BMW didn't let people foist that image on them and neither should Fiat.

The "single model dealership" issue isn't an issue - BMW did the exact same thing with Mini, as someone above pointed out.

The real issue, made clear by a lot of these comments, is the marketing. The car wasn't targeted at the Mini Cooper's audience - it wasn't promoted as fun to drive, practical, and stylish, and they didn't debut with a hi-po model available (like the Abarth) to boost its image even when, like the Mini and every other car, most people will go for the cheaper, slower version. They just like knowing there's a nice version out there.

If I were Kuniskis, I'd re-position the car. Don't spend a dime on tv or print until the Abarth drops, just viral internet like the "Seduction" ad. Push to get the remaining Studios open in time for the Abarth launch and possibly re-distribute existing inventory to new studios so the first dealers aren't stuck with a lot of old stock. Once the Abarth launches, push the car as a small, stylish, fun urban commuter that significantly undercuts the price of the Mini Cooper. No Jennifer Lopez or other celebrity endorsements, no latte-sipping 20-somethings lounging around with 3-day beards and moussed hair - sell the driving experience, not some lifestyle.

The car has sold half a million since launch four years ago - it was European Car of the Year, World Car of the Year, the 1.4L MultiAir is Engine of the Year. It's a GOOD car, especially for the money. There's no argument that can be made against it that doesn't apply to the Mini Cooper (too small for the US, poor fuel economy for the size, unreliable, impractical, unsafe, too expensive) and that still sells because in the end, it's a good driving experience. The Fiat 500 has that as well, and they need to focus on getting people to realize it.