The second model will be the Punto B-MPV, Fiat's first foray into the mini-MPV segment. They are confident that this model will draw on the Punto's class leading reputation for interior space and offer a practical, spacious and innovative new option that will attract customers who had not previously considered purchasing a mini-MPV. Both these new models will offer Fiat's new 1.3 Multijet 16v.

This year's Geneva Motor Show is rapidly becoming a showcase for the Italian auto industry with a string of public debuts scheduled. These include the Alfa 166 restyling, Lancia "Fulvietta" 2+2 Sport Coupe concept, Ferrari's stripped-out 360 Modena titled the "Challenge Stradale" and Lamborghini's new V10 powered Gallardo.

The highly compact 1.3 Multijet 16v diesel engine has a tough act to follow: more than 12 million FIRE units have been produced since 1984. The 1.3 Multijet, the first engine to be produced by Powertrain, the GM-Fiat joint venture, will play a key part in relaunching the debt crippled Fiat brand as both the "Small" and the Punto B-MPV are vital to the Group's fortunes and the diesel will play a key role. 

Fiat hope to follow a strong diesel tradition: In 1988 the Croma 1.9TDI was the first production car to be fitted with a direct injection diesel engine and ten years later the Alfa Romeo 156 1.9JTD became the first production car to adopt common-rail diesel technology, advances that have now been embrached by all leading car manufacturers.

The engines have been beefed up. Out goes the entry level 2.0-litre TwinSpark, to be replaced with the new 2.0-litre JTS engine. The 175bhp 2.4-litre JTD diesel carries over from the old model, the 2.5-litre V6 petrol continues, while the top of the range version will receive the 3.2-litre V6 from the 147GTA and 156GTA. The JTD and V6 petrol versions will offer the option of Selespeed transmission.

A 166GTA version will rapidly follow the introduction of the facelifted range, to keep interest in the 166 stoked up. Using the 3.5-litre V6 engine first seen in the 156GTAm concept at last December's Bologna Motor Show it will be tuned to give 300bhp.

The revised model will be officially launched at next month's Geneva Motor Show, and will hit the showrooms in Italy around July.

The new Lancia Stratos will be a 2-seater luxury mid-engined four wheel drive sportscar, producing 300-400bhp and limited to 1000 units. Designed by Bertone, it is believed that Ferrari have had strong input into the proposals including the area of technology sharing. The new Ferrari-designed 4.2-litre V8 engine that appears in the Maserati Coupe and Spider is under consideration, although the forthcoming GM/Alfa Romeo V6 engine is currently the route being tipped. The original Stratos was powered by a 190bhp V6 sourced from the Ferrari Dino, and, like the Fulvietta concept, the new Stratos will draw heavily on the old car for inspiration.

Lancia will continue to invest in their "luxury sports" image, with a fundamental overhaul of their dealer network, starting in Italy and fanning out across Europe. Early targets will include establishing new markets in the Eastern European countries, that stand on the verge of joining the EU. Longer term proposals center around a sales drive into Asia and the possibility of a return to the RHD markets, the UK, Australia, New Zealand and Japan.

Meanwhile Lancia claim to be pleased with the public response to two recent new models the Thesis and Phedra. The Thesis in particular has drawn attention as it makes its way onto the Italian roads and although orders are slightly behind expectations, dealers report "major" interest in the luxury executive saloon. 

"One of the reasons we are talking to suppliers and potential echnology partners is that we need to share investments," di Montezemolo explained. "If we do everything alone we can transfer investment only into a low number of cars." Ferrari has enough cash to bring the Maserati Quattroporte into production on schedule at the end of this year, but producing the Kubang GT Wagon SUV will be dependent on a fresh input of cash.

"What we are looking for is money to increase the volumes of Maserati," he continued. Ferrari are looking to significantly increase Maserati production as the marque re-establishes itself in North America, while sales drives in China, where the first dealership opened last year, and Russia are expected to tap into lucrative new markets.

Ferrari is majority owned by struggling Italian carmaker Fiat. Investment bank Mediobanca, often regarded as a proxy for the Agnelli family, led a consortium which took a 35% stake in the Ferrari-Maserati Group last June when a planned IPO was temporarily shelved in favour of a quick cash injection. The planned IPO is expected to go ahead this summer if stockmarket conditions are favourable. Projected plans to add the Alfa Romeo brand to create a super luxury-sportscar group have run aground.

Pre-production at the Polish Tichy factory will commence in January, with final production versions rolling from May. By the end of the year 70,000 are expected to have been built. 200,000 units will come out of the factory in 2004 ( 80% will be exported ) while 2005 will see production hit capacity of 250,000 units per year. By this point, the "New Small", initially to be produced in a 5-door version, will have been joined by a 3-door option along with a 4x4, performance "Sporting" and minivan. A number of options are also being evaluated including a "mini-pick up", as well as environmental and themed "fun" versions. 

The Fiat Simba, a "New Small" dressed up as an off roader, gave strong clues to the new mini-car's styling on its appearance at last December's Bologna Motor Show.