The two-cylinder Twin-Air was unveiled earlier this year at the Geneva Auto Show, and will be used on 500 units of the automaker’s signature 500 minicar beginning in September. The choice to equip their trademark car with a new, superclean fuel engine is part of the company’s plan to increase emission reductions and remain one of the most eco-friendly carmakers in Europe, according to a statement made by brand head Lorenzo Sistino on Tuesday.

Sistino elaborated, “It has taken the car sector 15 years to cut CO2 emissions by 20 percent. With the new Twin-Air, the world’s most ecological fuel engine, Fiat will cut CO2 by a (further) 30 percent in one stroke.”

The Twin-Air uses improved technology to offer four-cylinder performance from a two-cylinder engine, and is just one more facet of the Italian auto company’s efforts to build and sell small, efficient, green cars that retain their brand’s style and flair.

“Twin-Air is another step ahead for eco-technology and can represent a giant leap for the environment,” Sistino said.

Apparently, December was a great month for car sales, because Fiat, which owns 20% of Chrysler Group had a trading profit of 488 million euros ($690 million) in the last quarter of 2009. According to a statement made by the company, revenues increased by 3.6% for a final total of 13.6 billion euros. This number represents earnings before interest, taxes, or one-time gains or costs.

CEO Sergio Marchionne had told reporters last week that he believed results would be better than the average of consensus estimates, which were pegged at around 460 million euros.

Looking to the future, representatives of the group have labeled 2010 “…a transitional and stabilization year…” and believe that with the exception of the core auto business, which depended on eco-incentives being reintroduced, business would grow, with trading profit for the year with incentives expected to be 1.5 billion euros, with a 3-6 percent growth in revenue to 52-53 billion euros. Without those incentives, Fiat trading profits for the auto and spare parts business will likely fall by 350-400 million euros.

Fiat also said it expects its net debt in 2010 to be under 5 billion euros in 2010. The 2009 end-debt was 4.4 billion euros.