Fiat SpA made its official return to the U.S. market after a 25-year absence Wednesday with the unveiling of its Fiat 500 subcompact car at the Los Angeles Auto Show.

The vehicle will be sold primarily in urban centers such as New York, Chicago and Los Angeles.

With a starting price of $15,500, the car will go on sale in about 130 Chrysler Group LLC dealerships across the country starting in January. The price is about $500 less than its main competitor, BMW AG’s Mini Cooper.

The introduction of the 500 provides the final piece in Fiat and Chrysler Chief Executive Sergio Marchionne’s plan to revive the U.S. auto maker since Fiat took it over last year.

“The car is an expression of their individuality,” Marchionne said, explaining why he believes Americans will buy the 500. “It’s an icon. Why do people buy iPads or iPhones? They can buy any phone. This is designed to sell in a select size of the market and there is room in that market.”

(This story and related background material will be available on The Wall Street Journal website, WSJ.com.)

Aside from the Mini Cooper, the 2012 Fiat 500 will face competition from other entries such as the Ford Fiesta.

Marchionne said he is counting on the car’s customization to help generate sales.

Customers can choose from 14 color exteriors and 14 seat combinations. Most of the customization will be handled at the Mexico plant where the car is built alongside the Dodge Journey. It will take between 30 and 45 days for a customer to receive their car once they place an order.

The Fiat 500 will be offered in the Pop, Sport and Lounge models.