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The 2024 Fiat 500e will be one of two cars in Canada with a suggested retail price of less than $40,000.Jason Tchir/The Globe and Mail

While about a third of drivers looking for a new car say they are interested in a fully electric vehicle, according to a survey of Globe and Mail readers, one of the top reasons people say they aren’t considering one is cost.

That’s a fair point. The average price of a new EV is around $76,000, according to a recent report from online vehicle marketplace AutoTrader.

Now Fiat hopes it has an answer for Canadians looking for a small, peppy, relatively affordable EV – but Fiat knows it’s not for everyone.

When the all-electric 2024 Fiat 500e hits dealerships in Quebec and B.C. in May, it will be the only 2024 EV with a suggested retail price of less than $40,000.

“Millennials need a vehicle and there’s not much out there at this price, even with [a gas engine] any more,” said Mike Szymkiewicz, head of product planning at Stellantis Canada, Fiat Canada’s parent company. “Affordability is a huge issue for people right now.”

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The new 500e has lost some of the retro charm from the previous 500.Jason Tchir/The Globe and Mail

While the starting price for the base model is $39,995, it comes to $42,190 after adding in fees. That’s before taxes, the $5,000 federal rebate and provincial rebates.

The Chevrolet Bolt was cheaper – it starts at $41,572 after freight and other fees but before taxes and rebates – but GM discontinued it last year and, despite rumours, it’s not clear if it’s coming back. (In December, GM said it was planning a new version of the bigger, pricier Bolt EUV for the 2025 model year, but no dates or prices have been announced).

So, with Quebec’s $7,000 rebate, which is being phased out by 2027, the 500e will cost $30,190 before taxes. With British Columbia’s income-based up to $4,000 rebate, it will cost as little as $38,190 before taxes.

Meant for cities

Driving the 500e around Miami – where a city car makes sense – it was fun to drive and easy to park. It’s cute and slightly beefier than the previous 500 – it’s about two inches longer, wider and taller – and has lost some of the retro charm (also, there’s no convertible version).

Inside, it’s less cramped than before, but it’s still a tiny car. If you like your passengers, you might not want them to spend too long in the rear seat. The seats are comfortable, but some of the plastic feels cheap for a $40,000 car.

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The back seats aren't made for adults on long trips.Jason Tchir/The Globe and Mail

Thanks to the electric powertrain, it’s quick and responsive – but it has just 227 kilometres of range on its 42-kilowatt-hour battery.

It can dash to 100 kilometres an hour in about 9 seconds and can charge to 80 per cent in about 30 minutes on an 85-kilowatt fast charger (you can add 50 kilometres to the range in 5 minutes).

While that’s less range than most new EVs, road trips are still possible in provinces with plenty of fast chargers – like B.C. and Quebec.

The one-pedal driving (which engages depending on which of the three drive modes you choose) isn’t jarring, unlike some rivals.

Like the previous gas-powered 500 – which was pulled from Canada and the U.S. in 2019 because of low sales – Stellantis expects the 500e to appeal to buyers who mostly do city driving.

Fiat launched the 500e in Europe in 2020 and, since then, it has sold more than 185,000 of them in 44 countries.

In Canada, it will first be available in Quebec and British Columbia, which, combined, make up for about 55 per cent of all the subcompact sales in Canada. It will expand to the rest of the country for the 2025 model year.

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The 2024 Fiat 500e can charge to 80 per cent in 35 minutes.Jason Tchir/The Globe and Mail

Fiat is launching the base model first. For the price, it’s well-equipped and includes standard LED lights, heated seats, rain-sensing wipers, a wireless phone charger, wireless CarPlay and Android Auto, a 10.25-inch infotainment system with navigation, traffic sign recognition, automatic emergency braking and rear parking sensors.

The swankier La Prima – which costs $5,000 more ($47,190 before taxes and rebates) – has upgrades including leather seats, adaptive cruise control and a JBL sound system. It is expected to launch in Ontario and Quebec in the fall.

Will it change the market?

While affordability is keeping many Canadians from considering EVs, a $40,000 subcompact won’t suddenly change their minds, industry analysts said. After all, about 80 per cent of vehicles sold in Canada are trucks and SUVs.

To get most Canadians to buy EVs, we would need EVs priced on par with gas vehicles, said car industry analyst Robert Karwel, a senior manager at J.D. Power’s Canadian office.

“[The 500e] is not going to change market dynamic much, other than providing Stellantis with a few more EV sales,” he said. “While it’s a lower-priced car and more accessible, it’s also smaller than what the majority of Canadians drive.”

The average price of a new vehicle in Canada is about $48,000, Karwel said. But, typically, if you compare vehicles in the same segment, like compact SUVs, EVs cost as much as $20,000 more, before any rebates, than their gas equivalents.

About 80 per cent of vehicles sold in Canada are trucks and SUVs, Karwel said.

In 2023, compact SUVs were the biggest sellers in Canada with close to 470,000 sold – about 28 per cent of the market, said car industry analyst Andrew King, managing partner with Richmond Hill, Ont.-based DesRosiers Automotive Consultants.

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The trunk on the 2024 Fiat 500e.Jason Tchir/The Globe and Mail

There were only 8,530 subcompact cars sold last year – about 0.5 per cent of the market.

“More lower-priced EVs would definitely help move the needle on EV sales … [but] they need to be in the segments that Canadians want to buy,” King said. “Increased consumer choice is good … [but] what the market needs most are affordable EVs within the volume segments. Whether that is actually attainable remains to be seen.”

‘EV sales aren’t going anywhere but up’

J.D. Power’s Karwel doesn’t think the 500e will spur a resurgence of subcompact cars in Canada or attract buyers who want SUVs. But, despite recent headlines, he thinks that EV sales will keep growing.

While high interest rates and rising costs everywhere have slowed EV sales, they’re still growing – just not as quickly as some expected, Karwel said.

Plus, for many early adopters, price wasn’t an issue. But for mainstream buyers, price matters more.

“We’re going to sell more EVs this year than last year and next year, we’re going to sell even more,” Karwel said. “As with any new technology, it will grow in fits and spurts early on. EV sales aren’t going anywhere but up, as more choices, both up and down the pricing ladder and in a multitude of body styles, enter the retail market.”

The writer was a guest of the automaker. Content was not subject to approval.

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