Car of the Year?

We're only half way through 2007 and I think I've already found my Car of the Year. It's the Fiat 500 which is the finest, most intriguing supermini I've driven for years.

The Toyota Yaris might be better built, the VW Polo more durable, MINI is (for now, at least) a more attractive fashion accessory and all three small Citroens (C1, C2 and C3) have lower prices. But there's no doubt in my mind that Fiat's latest offering is, all things considered, probably the car to go for.

When a big part of your job involves driving around in circles, evaluating new cars, many of which are so damn ordinary, there are occasions when your enthusiasm for fresh from the factory products subsides.

Not with this car, though. While driving 1.2 and 1.4 versions of the 500 in Fiat's home town of Turin within the last few days (the fascinating 2 cylinder petrol and 1.3 litre diesel variants weren't available for test) I instinctively did something I've almost forgotten to do behind the wheel of a motor car: smile, have fun, remind myself that great cars don't need to be high powered and cost tens of thousands of pounds to be hugely entertaining and highly effective.

The 500 presses all the right buttons. Its official launch in Italy was 50 years to the day after the original unveiling on July 4, 1957 so, like the Mini, it has nostalgia built in as standard. That doesn't mean you necessarily had to be born in the late '50s to relate to the 500. Consciously or otherwise, you might have seen the cute original version on the streets of Britain or, more likely, mainland Europe when you were growing up in the 1960s or '70s and if that's the case you may wish to occasionally dip back into that glorious era.

Quite simply, the new 500 with its tastefully retro exterior styling and optional ivory coloured switchgear will take you right back there - preferably with the Beatles, Stones or Pink Floyd being played via the car's conventional in-dash sound system or via your MP3 player which can easily and quickly be plugged into the car.

In short, the latest Fiat 500 combines the very best of the old with the best of the new. It's the sort of car that you'll want to own and have parked in your drive, even if you really don't need one. In an ideal world a company car driver with a boring family saloon would have an ageing Porsche 911 in his garage for weekends. But while insurance costs, tax discs and punishments for using thirsty, dirty cars are all on the up, perhaps a spunky little pocket rocket such as the 500 is a more affordable alternative.

When the car goes on sale at the start of next year, 99 bhp versions will be available. A little later the 148 bhp derivative arrives. Who needs a more expensive MINI Cooper S?

Comparisons between 500 and Mini will and should be made. Although the Italian car is not cheap starting at around £9,000 (exact prices will not be confirmed until nearer UK launch time), it will undoubtedly undercut its English-built competitor which looks larger but is in some respects more cramped, particularly for rear seat passengers. Against that, Minis purchased new are a wise investment because they sell for such high prices on the second hand market years later. And while Mini's build quality and reliability is fair to good, a question mark still hovers over Fiat's.

The company's boss of bosses Sergio Marchionne insists that his new 500 boasts "quality standards that surpass the Japanese." And the test cars I drove undoubtedly had an upmarket and solid feel to them. But only time will tell if the car is as well made as Marchionne reckons it is.

One thing's for sure at this early stage of the battle between Fiat and Mini: the Italians are making plenty of positive noises about their latest offering while the Germans and English collectively responsible for Mini products seem almost embarrassingly silent. For example, Fiat effectively took over the centre of Turin in early July and used virtually every city centre street, square, bridge, shop and restaurant to launch its new baby car. A £5 million party was thrown and, using Hollywood-style tricks of the trade, road going 500s were driven on the wide river that winds its way through Turin. Seven Government Ministers and countless A-list VIPs were said to be at this party of the year.

So, with the eagerly awaited Mini Clubman due to be unleashed this Autumn you might have imagined that the company owned by BMW will be responding to the awesome events in Turin with a similar sort of mega carnival in London, or even its home town of Oxford. No chance. I've just been invited to the Mini Clubman launch in September and it's going to be staged in a location that I can only describe as bizarre and inappropriate&chilly, uninviting, out on a limb Aberdeen, Scotland of all places.

At this desperately early stage of the game, Fiat definitely has the upper hand in its battle against MINI. But is the new 500 attractive enough, cheap enough, strong enough and capable enough to inherit the Mini's crown as the coolest small car on the planet? You decide.

Mike Rutherford is a freelance writer, broadcaster and pro-car activist. Currently writing weekly columns for The Daily Telegraph and Auto Express, and monthly columns for The Independent and Motoring & Leisure, he also presented Pulling Power on ITV.

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