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Published: Tuesday, 1/10/2012

After disappointing first year in North America, Fiat wants fresh start in 2012

The Fiat 500 Cabrio by Gucci at the 2012 North American International Auto Show. The Fiat 500 Cabrio by Gucci at the 2012 North American International Auto Show.
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DETROIT — Fiat hopes to start fresh in North America after a disappointing first year.

The Italian brand sold fewer than 25,000 Fiat 500 subcompacts in the U.S. and Canada in 2011, only halfway to its goal of 50,000. Its network of new dealers was slow to get up and running. Awareness of the brand was low. Fiat was returning to the U.S. for the first time since 1983, when it pulled out of the market because of quality problems.

Sergio Marchionne, the chief executive of Fiat SpA and its partner, Chrysler Group, said the company shouldn't have set such a high target. He said Fiat based its numbers on sales of its closest competitor, Mini, which sold more than 62,000 vehicles in the U.S. and Canada last year.

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"We set ourselves up for the fall. We really did," Machionne said during an interview at the Detroit auto show. "And then people are saying, 'What's the future of Fiat? Well, the future of Fiat was exactly the same future that we had in mind when we launched the 500."

Marchionne said the brand now expects to sell between 25,000 and 35,000 vehicles in the U.S. next year and 5,000 in Canada.

Olivier Francois, the marketing chief for Fiat and Chrysler, said Fiat should have a much better year in North America. The company now has 137 dealers, compared with 70 six months ago. It's also rolling out two Fiat 500 variants: the upscale Gucci addition and the sporty Abarth.

"We needed better depth than just one car," Francois said. Marchionne confirmed that Fiat is also planning to launch a small minivan to the U.S. in 2013.

Francois said awareness of Fiat is growing since the company launched ads with singer Jennifer Lopez in September. Francois said the ads are helping position Fiat as an urban car with a lot of attitude. Later, the brand will focus more on its Italian heritage, he said.

After the disappointing first year, the head of U.S. Fiat, Laura Soave, was replaced in November by longtime Chrysler marketing executive Timothy Kuniskis.

Kuniskis said his top priority is increasing awareness of the Fiat brand. But in the meantime, he's happy with the customers Fiat is drawing, who come from many different ages and income levels.

"We're getting people from every demographic who just want something different," he said. "These are customers that Chrysler, Jeep and Dodge have never seen before."

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