Slumping sales have dragged Fiat into crisis. If the marque is to survive, it needs to rediscover the formula that made it successful in the first place: funky, but charming, small cars.

The new Panda is launched soon, then next year comes the Idea, a supermini MPV. Based on a mix of new and old Punto platforms, the tall (1660mm) Idea follows the tyre tracks of the Vauxhall Meriva. It's a competent and stylish vehicle that seats five adults in comfort and offers a practical solution to everyday motoring.

Priced at about £10,250 Fiat is positioning Idea in typical family hatchback territory. While some buyers will come from high-spec Puntos or low-spec Stilos, Fiat hopes the promise of big car space for small car money will lure C-sector customers who wouldn't normally consider an MPV.

Packaging will be a crucial weapon, and even in entry-level Activ trim the Idea comes with bags of standard kit including ABS, remote central locking, dual airbags, electric front windows and height adjustable driver's seat and wheel.

Dynamic trim adds air-con, CD player and painted electric door mirrors while the top of the range Eleganza comes with Dualzone air-con, alloys, fog lights and parking sensors.

With the Idea (pronounced e-day-a), Fiat hopes to capture a chunk of a market that is still in its infancy. More than 200,000 vehicles were sold in this sector across Europe last year; it could grow to almost 530,000 by 2005.

Fiat is taking a £299m gamble in an emerging sector. But the odds are good. Rather than getting bogged down in cost-cutting strategies, it shows it is determined to keep its head above water, using new product for flotation.