Fiat 500 helps automaker maintain minicar lead

The Fiat 500 replaced the Fiat Panda at the top of the minicar segment.
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Editor's Note: The ranking of the minicar segment's size in Europe previously was misstated and has been corrected. The Fiat 500 is the first near-premium model to top Europe's key minicar segment. The 500 ended the Panda's nine-year run as the top-seller in Europe's third-largest segment after subcompacts and compacts.

Together with the Panda, which finished No. 2, Fiat maintained its dominance of the segment with combined sales of 312,419 units, according to data from JATO Dynamics (see table on Europe's top-selling minicars in 2013, above right). That put it well ahead of Volkswagen Group, whose trio of minicars – the VW Up, Skoda Citigo and Seat Mii – had combined sales of 202,343 last year.

The closely related Czech-built Toyota Aygo, Citroen C1 and Peugeot 107 accounted for 175,798 combined sales, JATO figures show.

That means Fiat maintained its leadership of the minicar segment despite a slump in the five-door Panda's popularity.

Panda sales fell 18 percent on 2012 and were about half the level achieved in 2009. However, IHS senior analyst Ian Fletcher told Automotive News Europe this decline has more to do with market turmoil than any decline in the model's popularity. The latest version went on sale in 2012.

"The main reason is the depression in the Italian market, [the Panda's] biggest single market and one of the most heavily hit by the recent crisis," he said. Fletcher pointed out that car sales in Italy had fallen by 40 percent since their 2007 peak.

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Hyundai’s latest i10 may become one of Europe’s top 5 sellers this year.

Italy No. 1

Italy remained the no. 1 minicar market in Europe in 2013 even though the number of minicars sold in the country has declined sharply from the 2007 peak seen before the global financial crisis hit.

The next largest was Germany, followed by France, the UK, the Netherlands and Spain.

According to figures from automotive analysts Inovev (including estimates for December), last year 255,965 minicars were sold in Italy, just ahead of Germany's 227,659.

However in 2008, Italy's total of 414,828 units was almost double that of then second-placed Germany.

Inovev's analysis also shows that the emergence of a new competitor to the Fiat 500 – the Opel/Vauxhall Adam – boosted European sales of near-premium minicars to a new high of 24 percent of the total minicar segment last year.

With 45,800 units sold in its first year, the Adam was in 12th place in the minicar standings, according to JATO. The Adam offers customers similar levels of personalization as the Fiat 500.

Opel said early in January that sales of the three-door car had helped increase its overall European market share to 7 percent in 2013 from 6.9 percent the year before.

Based on data from 19 European countries, including Russia and Turkey, Inovev has estimated overall minicars sales were 1.1 million last year. So, even allowing for strong performances from 2012 newcomers such as the Adam and the Up, the minicar segment as a whole is significantly down compared with the 1.5 million units sold in 2009, when overall volume was boosted by scrappage incentives offered across much of Europe. The scrappage-inflated sales figure of 2009 will remain a one-off, Inovev told Automotive News Europe.

"We don't see sales getting anywhere near the levels seen in 2009," a spokesman said. "This is mainly down to the exceptional circumstances ... when the incentives in some cases made it a no-brainer to upgrade to a new minicar."

Bigger, cheaper cars

However the segment is also now under threat from bigger cars, notably the Dacia Sandero, Inovev said. "For the price of a car in the minicar segment, the buyer can acquire a simpler car but from the segment above," the spokesman said.

Sales of the Sandero soared 71 percent to 121,398 in Europe last year, according to JATO. In Italy the five-door Sandero starts at 7,900 euros. That compares with a base price of 10,610 euros for the smaller Panda and 12,310 euros for the Fiat 500.

Minicar customer are also likely to be hardest hit by economic uncertainty in southern European countries such as Italy and Spain, said Fletcher at IHS. "There's little incentive to upgrade at the moment if they're coming under pressure from the cost of living and fears of unemployment," he said.

The European minicar market is set to be shaken up this year by the launch of a number of key new models. These include next generations of the Renault Twingo and the Smart ForTwo, which are being developed from the same platform via Renault-Nissan's alliance with Smart's parent, Daimler. The two cars will go on sale after they debut at next month's Geneva auto show, where Toyota also will unveil its new Aygo and PSA/Peugeot-Citroen will show the C1 and 108 sister models.

In addition, 2014 will be the first full year of sales for the Hyundai i10. IHS predicts Hyundai will sell 100,000 i10s this year compared with about 61,500 in 2013. If that happens, the i10 could finish the year as Europe's No. 4-selling minicar behind the VW Up.

Europe is one of the few developed regions in the world in which very small cars account for such a large proportion of total sales, and that's not about to change. "We're tight on space and pretty sensitive to fuel costs as well," Fletcher said. "Historically, Europeans have never been shy about buying minicars."

Poland is Europe minicar hub
The majority of European minicars are built in eastern Europe. Poland was the largest producer of minicars in 2013, according to analysts Inovev. Led by Fiat's Tychy factory, which builds the 500 and Ford's related Ka, factories in Poland built more than 250,000 units last year, accounting for about 25 percent of all European minicar production.
The next biggest producer was Slovakia, where VW builds the Up, Seat Mii and Skoda Citgo. No. 3 was the Czech Republic, where the Toyota Aygo, Citroen C1 and Peugeot 107 are produced. Other eastern European production centers include Slovenia, where Renault builds the Twingo; Hungary (Suzuki Splash, Opel Agila); and Turkey, Hyundai's new production center for European versions of the i10.
Western Europe started to regain minicar production in 2011 when Fiat switched output of the Panda to Italy from Tychy. Germany went from making zero minicars to a little more than 45,000 last year when Opel started output of the Adam at its Eisenach plant. The few minicars currently imported from outside Europe include Suzuki's Alto (India) as well as the Chevrolet Spark and Kia Picanto (Korea). Ford is expected to build its next-generation Ka, due in 2015, in India.

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