124 Spider Could Be Big for FCAU Stock
Fiat Chrysler Automobiles NV (NYSE:FCAU) is preparing to launch a number of new cars named after historic models in its long history, which should help the Italian-American company boost sales to its highest level in years.
FCAU stock has followed a rollercoaster pattern over the past three months, moving from lows of $12.00 to highs of $16.00; its all-time high is $16.69, which was set last April. Now, the stock is trading in the $13.00–$14.00 range, but it could easily top $20.00 over the next few months by exploiting the nostalgia effect its expanding lineup is sure to create. The company’s “124 Spider” could be its next big hit.
One of the most anticipated cars in the coming months is undoubtedly the new Fiat “Tipo,” named after one of Fiat’s first cars, the “Tipo-1,” which was made from 1910 to 1915. Fiat does not plan to sell the car in the United States or Canada at this time, but the five-passenger sedan, which will be assembled in Turkey, will bring Fiat back into a crucial market segment: the affordable family sedan, competing against the likes of the Volkswagen “Golf.” (Source: “2016 Fiat Tipo and Fullback Pickup revealed in Dubai Motor Show,” DriveArabia, November 16, 2015.)
With the Tipo, Fiat aims to make its way into markets where a car of this type are all the rage, such as some Eastern European countries as well as markets where car ownership is a new concept, including India, China, and most developing countries.
124 Spider Could Bring People to the Showroom
The Fiat Tipo will be affordable, with prices starting at €12,000 (US$12,500) for a well-equipped model. The company will be virtually without rivals in the strategic and highly competitive C-segment of the market, one of the most important for big sales. Analysts expect the Tipo to become a great sales success and is one of the top candidates to receive the European press’ “Car of the Year” award, no doubt helping to push FCAU stock higher. Another top candidate to get the award is the “Giulia” sports sedan (also an iconic name), made by the company’s Alfa Romeo brand.
Carmakers have used nostalgia to great sales effect and few better than Fiat-Chrysler, which has based its big return on the global automobile scene on the “500,” now sold in a variety of segments from sub-compact to four-wheel-drive crossover. This car has helped the company defy expectations on the global scale.
FCAU stock will also gain points, as Fiat continues to exploit history and nostalgia with the new Fiat 124 Spider, which was formally introduced to the world on November 17 in Los Angeles. The location of its debut isn’t surprising, given its California top-down motoring appeal. (Source: “Fiat’s new 124 Spider brings old-school Italian driving pleasure to America,” Business Insider, November 18, 2015.) The Fiat 124 Spider, which in its style and name recalls the most successful Fiat model ever in the United States, the Fiat Spider (1966–1982), should appeal to sports car enthusiasts and company stockholders alike.
The 124 Spider brings Fiat back to the sports car segment with an affordable and proven model, sharing its platform with the Mazda “MX5” and “Miata.” In red or blue, the car is sure to attract drivers of all ages who are looking for a cheap to run and fun to drive car. It’s a poor man’s “Ferrari California,” of sorts, with a price tag of around $25,000. With this new vehicle, Fiat-Chrysler seeks to conquer new market shares after seeing excellent results so far in 2015.
The charm of Fiat convertibles has lasted for almost a century. Open-top sports cars are in the company’s DNA, so its stock should enjoy the benefits of recalling this legacy in its new model also. Fiat had to start making sports cars again to revive the brand, boosting FCAU stock’s value in turn.
After some difficult moments, the company’s new sports cars serve as an announcement to current and prospective stockholders that the company is back in the game. Driving with the top down and the wind in your face is different; it is glamorous. Cinema and television have captured the magic of roadsters and convertibles, turning them into a social phenomenon and the very symbols of a bygone era. Fiat is riding this wave of nostalgia back to the top of the charts.
The open-top car market exploded in the fifties and sixties, with cars becoming a status symbol, carving a special role in society, not just on the roads. Yet the Spider, as a two-seater minimum-luggage means of transport, represents a style that has existed long before the internal combustion engine. The Roman chariots of the Circus Maximus were light and nimble carriages, meant for speed and the creation of an image, rather than simply for practicality. These characteristics remained intact when the horse gave way to cylinders, pistons and valves, and the sports car was born.
The open-top sports car remains a vehicle mostly linked to the idea of escape and romantic pursuits, such as the image of Ben Braddock (aka Dustin Hoffman) driving a red Alfa Romeo through the night to stop Elaine’s wedding in The Graduate, one of the most significant movies of the 1960s.
The Alfa Romeo (a top FCAU brand) “Duetto” and Italian open-top sports cars have become emblems of freedom and money. In recent years, the classic two-seater has once again become a niche product, but its appeal has never waned.
The new Fiat 124 Spider is designed to fully reflect the shape of the 1965 Fiat Spider, designed by the great genius of the Italian car style that was Pininfarina. Its success was immediate, leading it to become a cult product that immediately captured the imagination of both the young and old. The cars appealed to Italian and American cinema directors, including David Niven, who raced across the silver screen in a Spider in the film No Deposit, No Return.
Here’s the Bottom Line on FCAU Stock
Collectors spend millions of euros for a Jaguar driven by Steve McQueen or a Porsche “Speedster” like the one James Dean owned, or they can spend less than $10,000 to secure a stunning Fiat 850 Spider like the one driven by Anna Magnani in the film The Car (and also seen in the trailer for Zoolander 2). She had a boundless passion for her little yellow sports car, confessing to her friend, “What can I tell you, I feel more beautiful while driving this car.”
Owners of Fiat-Chrysler stock might feel more beautiful—and richer, too—after the company’s nostalgic car goes on sale in the first quarter of 2016.