Fiat’s New 500e: A Shift from Super Cheap Lease Deals to Confident Positioning

Fiat’s North American Lead Aamir Ahmed explains why the new 500e won’t be offering the same super cheap lease deals as its predecessor.

When Fiat introduced the electric version of its iconic 500 model, the 500e, back in 2014, the company faced significant financial losses, prompting the then-CEO Sergio Marchionne to actively discourage people from buying the car. However, the tide has turned with the latest iteration of the 500e. Fiat’s North American Lead Aamir Ahmed asserts that the new 500e is a ground-up fully electric model that will be cash-positive, marking a stark departure from the financial challenges of the past. In this article, we explore Ahmed’s confidence in the new 500e and why Fiat has chosen to forgo the super cheap lease deals that made the original 500e popular.

A Shift in Strategy: From Loss Leaders to Profitability

Ahmed highlights the stark difference between the previous 500e and the new model, stating that Fiat will actually make money on each unit sold. This is a significant departure from the reported $14,000 loss per unit that Marchionne complained about in 2014. The new 500e is a ground-up fully electric model, with no shared development costs against a gas-powered car. Ahmed’s confidence in the product’s profitability stems from the fact that Fiat will not need heavy incentives or fire sale pricing to move units.

The End of Super Cheap Lease Deals

In the mid-2010s, Fiat offered incredibly cheap lease deals for the 500e, with prices as low as $49 per month in some regions. However, Ahmed firmly states that those lease deals will not be returning. He attributes this decision to market conditions and the strength of the new 500e. With confidence in the product, Fiat aims to avoid relying on heavy incentives to attract buyers.

Positioning the 500e: A Unique Offering in a Sea of EVs

Ahmed acknowledges that on paper, the Fiat 500e may not appear to be a great value. With only 149 miles of range from a 42-kWh battery, it falls short compared to other small premium hatchbacks like the Mini SE, which is cheaper and more powerful. However, Ahmed remains unfazed. He shares that Fiat and Stellantis have received positive feedback from potential buyers who appreciate that the 500e is a small EV designed for short distances. In a market flooded with oversized EV trucks and crossovers, the Fiat 500e stands out as an attractive option for those seeking a compact electric vehicle.

Incentives and Charging Infrastructure

To entice potential buyers, Fiat plans to offer DC fast charging credits and a free Level 2 charger upon the release of the 500e. Ahmed reveals that around 60% of interested buyers have opted to accept the charging station. Fiat hopes that these incentives, along with the unique positioning of the 500e, will be enough to attract buyers, as the company is not relying on heavy discounts to move units.

Conclusion: Fiat’s new 500e represents a shift in strategy for the company. With a ground-up fully electric model that promises profitability, Fiat is confident in the positioning and appeal of the 500e. The decision to forgo super cheap lease deals reflects the company’s belief that the product is strong enough to stand on its own merits. While the 500e may not offer the longest range or the most powerful performance in its segment, it fills a niche for those seeking a small EV designed for short distances. With incentives such as charging credits and free Level 2 chargers, Fiat aims to attract buyers without relying on heavy discounts. Only time will tell if the market responds positively to Fiat’s confident positioning of the new 500e.