Fiat 500 Hybrid to Jumpstart Italian City Car Comeback

Fiat is going back to basics in a big way, and it’s all riding on a new version of its iconic 500 city car. Starting this November, the brand will launch the Fiat 500 Ibrida (Hybrid) — a more affordable and practical version of the popular hatchback — in an effort to revive its struggling vehicle production in Italy.

Built at the Mirafiori Assembly Plant in Turin, the 500 Hybrid will be priced at just €17,000 (around $20,000), making it one of the most budget-friendly options in Fiat’s lineup. The car is equipped with a simple 12-volt lithium battery mild-hybrid system, designed to improve fuel economy without the high cost of a full hybrid or electric setup.

“This is the 500 for real people,” said Fiat CEO Olivier Francois. “It’s for those who want a small, stylish car that’s efficient, practical, and doesn’t break the bank.”

Fiat plans to produce 5,000 units of the Ibrida by the end of 2025, with annual production expected to exceed 100,000 units thereafter. That’s an important move for Stellantis — Fiat’s parent company, which saw Italian production drop to just 475,000 vehicles last year, down nearly 46% from 2023 levels. That’s the lowest car output Italy has seen since 1956.

Several factors are to blame: sluggish demand for electric vehicles (EVs), fierce competition from Asian automakers, and factories that are either idle or being retooled for upcoming models. The new 500 Hybrid is Fiat’s response — a no-nonsense small car that appeals to budget-conscious buyers still on the fence about going electric.

But the brand isn’t done with EVs.

Looking ahead to 2027, the brand plans to launch an upgraded and more affordable version of the all-electric 500e, expected to cost around €20,000 (approximately $21,800 USD). That’s a significant price drop compared to the current 500e, which starts at nearly €30,000 (approximately $32,800 USD) and has struggled in the market, with only 25,000 units sold last year.

The goal is clear: offer two versions of the 500 that actually sell. One for people who still prefer gas-powered simplicity, and another for those looking for an affordable way to go electric, without the luxury price tag.