And also like health and fire services, your fire station can be expanded with more engines and also a bell to shorten response times (recommended). The large fire station offers a faster response time and enhanced features such as a Hazmat engine (assuming you've gone through a few upgrades you'll get this otpion later in the game). Hazmat engines are important later in the game for dealing with industrial fires. There is also a fire prevention uprage in the large fire station too.
Money is rolling in so we've opted for the larger fire station
Upgrading your Fire Service
Sooner or later it is inevitable that your fire service will come under strain, and you may well start to get HazMat fires, to handle these you'll need the Large Fire Station which can add on HazMat Fire Trucks. But before you can have one of these you MUST have a department of services goverment extension in the region. As well as more and better trucks and a faster response time, this station also offers the Fire Marshall Office upgrade which when added will prevent fires in any buildings the Fire Marshall visits for several days.
Large Fire Station
As the game progresses you'll soon see that you don't have enough fire coverage with just one small station, no matter how much you upgrade it, and you'll probably be better off trying to plop a Large Fire Station as it is the only option that allows for HazMat trucks, it also has much faster response times. You may need to take out a bond to get one of these quickly but it's worth it as one of the challenges allows you to recoup some of the spent cash.
Relateively early in the game, you'll receive an option to take to Firewok Fun Challenge, this basically awards you 50,000 Simoleans if you can not have 6 fires within the following 24 hours of starting the challenge. So really you need a jacked up fire service for you to succeed here. My recommendation is to reject this until you have at least two operational Fire Stations, with bells! And extra trucks... Ideally you'll already have the Fire HQ.
Firewirk Fun Challenge
It won't be long before fires start to break out in the city. So, hopefully you've been following the advice up until now and have a decent sized stash of simoleans stored away with more rolling in every hour. You have two choices, add a standard fire station or a large Fire Station (only if you have another City in the same region with the services government building). Select the fire icon to see your options. Similarly to the health service one fire station for the whole city just won't cut it long term, so plan ahead and think of two good places to plop a fire station and select one of these. It should give good access to industry or residential zones, or both.