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RETRO-styled cars - Volkswagen started it with the revived Beetle in 1998, followed by the BMW-built MINI a couple of years later.
The Fiat 500, then, is the new bambino on the block, launched last year, but what it has in common with the other two is that it shares not one ounce of the mechanical DNA of the original car from which it takes its name. All three are the result of clever styling which evokes the original cars, but brings them bang up to date.
Of the three, the Fiat is possibly the most stylish. Gone is the air-cooled rear engine of old. This car is built solidly on the Fiat Panda platform, and if you were building a small city car, that's a pretty good foundation to start with.
The 500 really does evoke the look of the original, which gave way to the Fiat 126 in the 1970s. It is typically Italian - incredibly stylish. It is unusual for people to look twice at a car this small, but drive a 500 and you really do attract a second glance. My test car was red with a white stripe down the side, which I am less sure about - Starsky and Hutch hit by the credit crunch, or am I showing my age?
Other touches include fog lights, alloy wheels and a dazzling array of trim and other options.
Inside the car, the stylishness continues. The body-coloured dash evokes the painted interior of old, and while it may not have the quality feel of the MINI, the controls are probably better laid out and easier to use, with the exception of the combined speedo/rev counter, which looks great but is acually quite hard to read.
Like the Panda, the gear shift on the 500 is mounted up on the dash, which, to my mind, is a far more logical place for it and makes it much easier to use.
There are a number of options, including a lovely cream fascia and steering wheel, if you think you can keep it clean,
Don't bother, though, with the £250 'Blue and Me' option for phone and iPod connectivity. No one should use a phone while driving, not even hands-free, while I found the MP3-player part of the system worse than useless, being complicated, cumbersome and limited in what it would and would not play from my iPod. Unless it just didn't like Bob Dylan...
The 500 will carry four adults in comfort and the rear of the car feels roomier than the MINI, which is quite cramped for passengers. The leather sports seats on my test car looked the business and were very comfortable, even on a long journey
The boot, at 185 litres, is smaller than the Panda but larger than the MINI. It is adequate for shopping or two people's weekend luggage - you do not buy a car like this for its massive payload. It is first and foremost a city car.
The Fiat 500 has a choice of three powerplants; the latest 75 bhp derivation of Fiat Group Automobiles’ widely acclaimed, 1.3 litre 16-valve MultiJet turbodiesel, and two refined and economical FIRE petrol engines – a 1.2 litre 8-valve 69bhp unit, and a spirited 100bhp version of the 1.4 litre 16-valve powerplant.
Both 1.2 litre petrol engine and 1.3 litre turbodiesel come with five-speed manual gearboxes, while the 1.4 litre petrol unit is mated to a six-speed manual transmission. Dualogic – a clutchless, five-speed sequential manual shift with a selectable fully automatic mode – is offered as an optional transmission on all petrol-engined Fiat 500 models.
I have been driving the MultiJet turbodiesel and have been very impressed. Whilst not the quickest off the blocks from a standing start (0-62mph in just over 12 seconds), this torquey little motor is smooth, quiet, and will gently haul the car up to a top speed of over 100mph. It will handle motorway journeys with the same ease with which it enjoys being squirted down backstreets.
It is also incredibly frugal, returning extra urban consumption of 78.5mpg and combined 67.3mpg, better than the petrol-electric hybrid I drove last week. Filling the relatively small (35-litre) tank gives you a range of over 360 miles, which adds up, especially if you do a reaonable daily commute.
The driving experience is further enhanced by the choice of two steering modes - choosing 'City' makes it lighter and more responsive for low-speed driving. I suspect most drivers will keep it permanantly on this mode.
Safety has not been overlooked. With a 5-star Euro NCAP safety rating to its name, the new Fiat 500 builds on an already impressive safety portfolio with the full range of braking, traction control and stability systems available on the market today: ABS anti-lock brakes, complete with electronic brakeforce distribution, ASR to limit wheel spin during acceleration, MSR to modulate brake torque while changing down, and a sophisticated ESP to control stability through bends. Vehicles fitted with ESP – standard equipment on 1.4 litre versions – also benefit from hydraulic brake assistance and a unique Hill Holder function to facilitate smooth hill starts.
My lasting impression of driving the Fiat 500 is that is it huge fun while being extremely economical. It has bags more character than the average city car, and I am a sucker for any car whose owners wave at each other. With an entry price of £8,100, this is an excellent way of getting a car which is that little bit different at a sensible price.
At a glance, Fiat 500 1.3 16v MultiJet Sport
Price: £10,900
Top speed: 103mph
0-62mph: 12.5 seconds
Fuel consumption: urban - 53.3mpg, extra-urban - 78.5mpg, combined - 67.3mpg;
CO2 emissions: 110gkm

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