Geneva auto show hopes small models equal big profits

Small is beautiful for carmakers at the Geneva Auto Show with an eye on congested cities, one-parent families, rising oil prices and growing concern at the environmental impact of motor vehicles.

Taking centre-stage at the 78th show, which opens to the public on Thursday, is a giant model of the iconic Fiat 500, which the Italian carmaker revamped for its 50th anniversary to appeal to modern drivers.

The classic 1957 model was "a car for Everyman, but now Fiat is looking at high-end clients," Fiat's Swiss marketing director Thomas Schneider said.

"There's a fashion factor just like the Smart or Mini a few years ago: we want to show that a small car can be cool," he said.

Schneider also said there was strong demand for small cars as parking spaces in cities grow ever scarcer, and also as drivers become more environmentally conscious.

Changing social patterns and more one-parent families also make smaller cars attractive, he said.

The new "Cinquecento" was launched last July 4, fifty years to the day after its illustrious ancestor, and has already had much greater success than expected with 140,000 orders in 2007 and production capacity expected to rise to 160,000 this year, Schneider said.
"The delivery lag is between four to five months on average," he added.

The basic price for the 3.55 metre (11.4 foot) long car is $14,000, but higher-end versions such as the 500 Abarth sports model will cost more.

Smaller models traditionally yield fewer profits than larger ones, so manufacturers are seeking to develop deluxe versions to rake in more cash, said Peter Schaer, public relations director of Peugeot Switzerland.

This is clearly the thinking behind Toyota's new "iQ" model, unveiled to the press recently.

The iQ is "the world's smallest four-seater passenger car," Toyota Europe senior vice-president Andrea Formica told journalists.

It can seat three adults and one child, and Toyota hopes its small size will make it attractive to urban drivers.

The iQ will also have a CO2 emissions target of 99 grams per kilometre and will thus play a key role in cutting Toyota's fleet average emissions.

Toyota aims to sell 100,000 iQs by 2009, at around the same price as its slightly larger Yaris model.

The Yaris sales price currently starts at 11,000 euros in France.
Not all manufacturers think that small and cheap are oxymorons however.

India's Tatar Motors is setting great store by its Nano model, billed as the cheapest car in the world at just $2,500, and aimed at Indians hoping to trade up from a motorcycle to four wheels.

The basic model has no air conditioning, no electric windows and no power steering, although two deluxe versions will be available.

"It is not presently planned to be launched in Europe," tycoon Ratan Tata told reporters, though he added that he hoped a upgraded, "high-end" version could one day be available. (AFP)