Crack open the Chianti! Fifty years to the day after the original model stole the hearts of motorists the world over, the Fiat 500 is back.

The cultural significance of the Cinquecento, the car that put Italy on wheels in the 1950s, cannot be denied. And when you hear Fiat’s Chief Executive Luca De Meo talk about the 2008 Fiat 500, you get the sense that it is not just the future of Fiat that rides on the fortunes of this new car but that of Italy as well.

Judging by the public acclaim at the 2008 Fiat 500’s unveiling, the decision to put into production the universally admired Trepiuno concept car from 2004 should pay off for Fiat.

Reliving the Italian Miracle From the 1950s

By resurrecting the 500, Fiat is attempting to relive one of the most successful periods in its history. Some 3,702,078 examples of the Cinquecento were produced between 1957 and 1975, and it is very much regarded as an automotive icon in Italy. Such is its enduring charm that the 500 still forms part of the Italian landscape, even three decades after it ceased production.

The new Fiat 500 manages to pull off the neat trick of both celebrating the classic Cinquecento as well as looking forward, connecting the past with the future.

It goes on sale in Italy in September with a price premium of around $1,000 above the entry-level Fiat Panda, the car upon which it’s based. Fiat hopes the 500’s unique appeal will support sales to a broad range of buyers. “You don’t buy this car because you can’t afford a larger one,” says Fiat’s Luca de Meo. “You buy it because of what it says about you.”

Design is clearly the new 500’s biggest draw card. Driving through the streets of Turin, our bright red car was mobbed by enthusiastic Italians, all eager to get a closer look. At one stage, we were asked in broken English if we would mind the company of two extra passengers. Everyone seemed to know what it was. As we scooted past, there were shouts of approval and even the odd jump of joy.

Measuring Up to the Past

Despite a fundamental change in the mechanical layout and a significant increase in overall dimensions, the proportions of the 2008 Fiat 500 remain virtually unchanged, the only big change being an extended front overhang thanks to stringent requirements for frontal crash test regulations. Fiat credits the exterior design to Roberto Giolito, an Italian working at its Centro Stile studio, but word on the inside has it that former Fiat design boss Frank Stephenson was the driving force behind the car’s retro lines.

Whatever the case, there’s no doubting the new 500’s broad appeal. At just 139.6 inches in overall length, 64.0 inches in width and 58.6 inches in height, the new 500 is 6.0 inches shorter, 2.2 inches narrower and 3.2 inches higher than the Mini Cooper — dimensions that make it perfectly suited to the narrow lanes and traffic-clogged streets so common across Europe.

With a drag coefficient of just 0.32 Cd, the 500 slips through the air with greater efficiency than just about any rival small car. It is also exceptionally light — the top-of-the-line 1.4 model tested here tips the scales at a modest 2,050 pounds, complete with seven airbags (including a knee airbag for the driver) and a whole load of standard features. By comparison, the Mini Cooper weighs 2,348 pounds.

Along with the initial hatchback driven here, a station wagon that is planned to revive the evocative name of the 500 Giardinetta has also been conceived, and an SUV version based on the all-wheel-drive Panda Cross is also in the works.

Just like Mini, Fiat offers an unprecedented number of ways to customize the 500. Together with a wide range of exterior colors, you can add stripes in the red, white and green of the Italian flag in all sorts of different variations, or alternatively a checkered-flag roof, an oversize bar code or many other motifs dreamed up by Fiat’s in-house design team. There’s also a wide range of 14-inch, 15-inch or 16-inch wheels.

Underneath It’s Cheap and Cheerful

To keep costs down, the new 500 is based around the front-wheel-drive Fiat Panda and it will roll out of Fiat’s low-cost factory in Tychy, Poland, at the rate of 120,000 per year. Fiat anticipates nothing less than a maximum five-star Euro-NCAP rating, but officials we spoke to denied that the new car had undergone any National Highway Traffic Safety Administration testing. Still, our contacts don’t rule out the possibility of the 500 eventually popping up on this side of the Atlantic as part of Fiat’s global renaissance.

The shared underpinnings give rise to a familiar lineup of engines from the Panda. On the gasoline side is a 68-horsepower 1.2-liter inline-4 and a muscular 100-hp 1.4-liter. The diesel is a 74-hp 1.3-liter. At the Tokyo auto show, Fiat will pull the wraps off a turbocharged 1.4-liter Abarth engine serving up 135 hp.

We opted to drive the gasoline-fueled 1.4-liter, figuring it would provide a lively drive. Smooth and punchy at low revs, it is impressively responsive around town. At the same time, it will happily rev up to the 6,000 rpm redline without any undue strain. It doesn’t quite propel the Fiat 500 into the same performance territory occupied by the Mini Cooper, but manages to pull the 500 to 100 kph (62 mph) in 10.5 seconds and on to a top speed of 113 mph.

Driving It Around

It is the Fiat 500’s ride and handling that sets this car apart. The structure is remarkably stiff, giving the 500 a grown-up feel from the driver seat. The wide track and comparatively long wheelbase endow it with a firmly planted sensation and deliver excellent stability at high speeds. Small it may be, but the 500 devours big distances with real aplomb.

Fiat makes bold claims about its new model’s dynamics, suggesting it can generate 0.97g on the skid pad. The 500 is certainly entertaining, if not exactly kartlike. The electrically operated power steering lacks real feel even when the sport mode is selected to dial up weightier effort, but it is nevertheless direct, providing the 500 with great agility and a true willingness over winding roads.

For all the visual charm provided by the Fiat 500’s exterior, it is the quality of the interior that wins our heart. The love affair starts the moment you draw open the door via a lovely metal handle and slide onto the softly cushioned driver seat. The dashboard recalls that of the Cinquecento, yet plays host to a large instrument pod with futuristic gauges.

Given its compact dimensions, there is ample space and a good deal of seat adjustment. In fact, interior packaging appears to be one of the 500’s biggest assets. You sit well back in the chassis in a rather upright position, but it’s comfortable all the same, with spongy seat cushions and a high-mounted gearlever well within reach.

Remember the Topolino?

This is Fiat doing what it does best. Since the days of the Fiat Topolino in the 1930s, the Italian carmaker has always excelled at building small cars — truly affordable small cars for the motoring masses, no less. But this time around it appears to have outdone even itself. The Fiat 500 has an iPod-style coolness that everyone responds to.

There is a perceptible maturity to the new 2008 Fiat 500, from the wonderfully cohesive styling to the weighting of its controls. In fact, this newest version of the Cinquecento has a refinement that still has yet to materialize on other models in the Fiat lineup.

Provided there is no big hiccup in quality when production versions begin their run down the assembly line in a month or so, the 2008 Fiat 500 should be Europe’s next cult car.