Fiat plans to phase out its entry-level 1.2-litre petrol engine in the Fiat 500 in favour of its new two-cylinder 900 Twin Air engine.
The first of the Twin Air engines, an 84bhp turbocharged unit, will go on sale in the Fiat 500 in September for an estimated price of around 11,000.
Fiat also plans a 104bhp turbocharged Twin Air engine and a 68bhp non-turbo Twin Air, which is likely to be the entry-point to the Fiat 500 range.
The car maker also says the 84bhp Twin Air engine will form the basis of a mild hybrid set up which means it won't run on electric power alone for a future car. The engine will be mated to a 10 or 15Kw electric motor, powered by a relatively small battery pack, to keep weight and costs down.