The Panda Classic would serve as a Fiat's entry-level offering.

The third generation of the Fiat Panda bowed at last September's Geneva Motor Show and is slated to hit showrooms in early 2012.

For a while it looked like the second generation of the popular Fiat might go into a well-deserved retirement, but a new report coming out of Italy suggests otherwise.

According to Quattroruote, Fiat plans on keeping the second generation Panda around as an entry-level offering. It will be built in the Tychy, Poland, factory and dubbed the Panda Classic. The lineup will likely be cut down to a single trim level.

Fiat's main motive behind this move is to compete against the Dacia Logan. The low-cost sedan from Renault is quickly gaining ground in Italy. The Panda's base price of 8,500, ($11,370) is north of a Logan's price, but it's better than nothing.

As an added bonus, the Panda enjoys a good reputation on the Italian market and it saves Fiat the money of developing and marketing an entirely new model.

Fiat would not be the first European automaker to keep an old model around as an entry-level offering. Peugeot pulled the same trick with the 206+, a 206 hatchback with a 207-like front end that cost thousands less than the actual 207; Renault still sells the second-generation Clio as the Clio Campus, and Fiat's last-generation Punto is still around, rechristened the Punto Cult.

1.'La vecchia Panda...' view