Honey, I shrunk the car

These are the latest spy shots of Fiat’s new micro-car, dubbed the Topolino after the company’s original 1930s small car.

The diminutive Italian, which will sit below the Fiat 500, is one of a rush of new micro models being planned by carmakers looking to beat the European Union's tough new emission laws, which will take effect in 2015.

The Topolino, tipped to built in collaboration with Indian firm Tata, is also said to use a two cylinder engine, with a capacity of 900cc. Diesel and full electric power will be options, although electric power won’t be available at launch, which is slated for the middle of 2010.

Industry speculation also has Fiat collaborating with BMW on the micro car platform that would underpin both the Topolino, and a proposed BMW small car that has been dubbed the Isetta, after the original bubble cars of the same name made by BMW under license in the 1950s.

While it’s true that BMW and Fiat have signed a memorandum of understanding that will see them collaborate on new cars for Alfa-Romeo and Mini, insiders say that the deal doesn’t extend further downwards into the Isetta size range.

According to reports, the Isetta will use a twin-clutch semi-automatic gearbox that, combined with light weight and efficient aerodynamics, will lead to 42 km per litre fuel efficiency (that’s 100 mpg in the old money) and carbon dioxide outputs of less than 100 grams per kilometre.

But Toyota will beat both makers to the punch with its new iQ model, which is slated to go into production towards the end of 2008. The iQ measures 2985mm and has a 2000mm wheelbase, yet Toyota claims it will seat four due to space saving innovations in packaging. These include a flat fuel tank under the floor with angled rear shock absorbers, a newly developed differential that allows short frontal overhangs and a small heater and air conditioning unit. There are also sliding passenger seats, and an asymmetric dashboard that provides more room for the front passenger by allowing the seat to be moved forward.

Toyota hasn’t said what engines will power the iQ, however the company has said that there will be the choice of petrol and diesel power units that, combined with the car’s low weight and aerodynamic efficiency, should lead to emissions in the region of 100g/km of CO2.

Toyota estimates it will produce 100,000 units of the iQ in the first full year of production.