Fiat 500X: Where's the halo?

Fiat's 500X, the perky subcompact crossover that arrived in dealerships six months ago, has been selling well but has done little to help the beleaguered brand overall -- as it was counted on to do.

Dealers say the 500X hasn't multiplied showroom traffic as much as it has subtracted sales from other Fiat models.

"It's substitution," said one frustrated Fiat dealer who asked not to be named. "There's no more traffic coming into the showroom than before."

While sales of the 500X have been rising steadily, those of the two other Fiat models are down sharply, and inventories are bloated. Fiat Chrysler and its Fiat dealers have a 280-day supply of the 500L, and a 239-day supply of unsold 500 minicars.

Dealers who counted on the all-wheel-drive 500X to boost new-vehicle sales in their struggling stores are disappointed. And their Fiat equation -- one that allows them to make a return on their investment -- is getting harder to solve.

In April, Jason Stoicevich, then the head of the Fiat brand in North America, said the crossover would give Fiat "additional opportunities" in snowy regions, such as the northeast United States. He said the 500X would be "a game changer for us. This will be the halo of the brand."

Stoicevich has since resigned from FCA, and former Fiat brand head Tim Kuniskis was given responsibility for the brand again -- in addition to running the Dodge and Chrysler brands. Kuniskis is a favorite of Fiat dealers. He was largely credited with reviving the brand after a rocky launch when he first took the reins in November 2011, replacing Laura Soave.

Karl Brauer, a senior analyst with KBB.com, said the 500X "finally gives Fiat a model in a segment that is growing, not shrinking."

"It lets Fiat take part in the current popularity of compact SUVs but doesn't help the automaker with 500 or 500L sales," he said.

In October, the crossover outsold the 500 and the 500L combined in the U.S.

Brauer said consumers visiting a Fiat showroom "who started out thinking about a 500 or 500L might switch to the 500X once they realize the Italian brand offers a small SUV with appealing looks, engaging driving dynamics and more functionality than Fiat's traditional models."

In October, sales of the 500 were off 54 percent to just 1,286 nationwide, while sales of the 500L were down 68 percent to just 293. Through 10 months of the year, 500 sales declined 23 percent while 500L sales were down 25 percent.

Bob Broderdorf, who runs the Fiat brand in North America on a day-to-day basis, said he and other FCA executives are happy with the pace of 500X sales and are trying to determine why 500 and 500L sales have fallen.

"We're trying to gauge how much of this is [500X] and how much of it is just what's happening to small cars in general" as lower gas prices draw consumers into larger vehicles, Broderdorf said.

Some Fiat dealers say the 500X has yet to reach its full potential.

"I'm actually pretty excited about the 500X," said one East Coast dealer. "It's a nice package, but we're just not getting enough consideration ... for whatever reason.

"As winter comes, and we start running some winter ads with the 500X in the snow, I'm hoping we'll start getting some consideration and get the franchise back where it needs to be."

A fourth model coming to Fiat showrooms next year is a convertible based on the Mazda MX-5 Miata. But that specialty car is not expected to add significant sales volume.

Broderdorf said Fiat's marketing message for the 500X is likely to change from emphasizing the brand to touting the crossover's awd and Top Safety Pick+ safety rating from the Insurance Institute for Highway Safety.

He said he had nothing to announce yet, but, "If I were to launch a next ad, that's probably a perfect place to go."

The 500X is built in Melfi, Italy, alongside the new Jeep Renegade subcompact, and shares many components with the Jeep. In fact, the differences between the two vehicles beyond their styling are minuscule. The 500X is more expensive than the small Jeep, and it gets slightly better fuel economy.

The Renegade went on sale in March, two months earlier than the 500X. Through October, 44,626 Renegades were sold in the U.S., compared with 5,634 500Xs. In fact, Jeep sold more Renegades in October (7,795) than Fiat has sold 500Xs all year.

To be fair, the 500X is sold in just 208 Fiat dealerships in the U.S., while the Renegade is sold in well over 2,000 Jeep stores. But most Fiat studios are located very near to their owners' Chrysler-Jeep-Dodge-Ram dealerships, making direct competition between the two models inevitable.

"If customers do any research and find out how close the two are, most people are going to choose the Jeep," one sales representative at a Midwestern Fiat store said. "That makes it tougher to get a sale."