Smart has been operating here in the US of A for about 3 years now, and they seem to be the perfect example of an automotive fad.  While it’s been successful in Europe, I’m not quite sure that it’s been a big hit in the States, and I have reason to believe that the car is flawed in more ways than one–and the market itself hasn’t been helping, either.

First off, Smart’s sales aren’t impressive when you break them down.  By the numbers, Smart sold over 45,000 units from 2008 to 2010, which isn’t at all bad for such a small company.  Unfortunately, their sales have dwindled significantly each year after 2008.  They sold about 25,000 in 2008, then just 15,000 in 2009.  By 2010, sales dropped by another 10 large, to just around 5,000 units or so (Be aware that these figures are rounded). Now, in their defense, Smart’s sales did pick up this year, and are now close to the number sold for the entirity of 2010 in just the first 7 months of the year.  But, that sales improvement may not be such good ground for them to stand on.

Smart hasn’t been a moneymaker, either.  When Roger Penske’s firm was handling the imports and such, he lost a large amount of money when sales tanked suddenly.  In fact, Mercedes-Benz USA now handles Smart imports.  Also, two of their strong points to sell these little cars haven’t gone the way Daimler has hoped in the years since its USA launch.  For one thing, the Smart isn’t at all a decent car to have if it’s your only vehicle (and therefore is taken on longer trips)–it’s a niche car, and therefore, in my opinion, a toy at best.

So, if one has the disposable income to spend on one, they might do it, but I don’t see people using one as a daily driver unless you live in a big city (such as New York, Chicago, Boston, L.A., etc) and never leave the city limits.  While it will get 38MPG, it requires premium fuel (and only takes 8.7 gallons), only seats two people, and barely carries any luggage.  The transmission is an automated manual with all the smoothness of the Rocky Mountains and it doesn’t come with standard power steering (I will admit that as an enthusiast, that fact is pretty cool).  I don’t see the point of buying one, despite its benefits.

As an example, the Hyundai Accent, which with options, will cost about the same as the Smart ForTwo Passion.  It will seat four or five people plus cargo, still get 40MPG on the highway, and unlike the Smart, runs on regular.  The Civic Hybrid, meanwhile, costs more, but gets even more gas mileage, and makes the Smart look like a joke by comparison.  They both sip fuel, but the Honda is still more livable day-to-day.

Finally, two of Smart’s biggest bets haven’t paid out consistently.  The first was that the economy would remain strong–which it most certainly has not, causing sales for most niche cars to falter to varying extents.  The other was that gas prices would remain high.  When gas prices were high, sales of the Smart were sizeable, and the same effect occurred when prices spiked back in the spring and early summer, when Smart recorded year-over-year gains.  But, they weren’t nearly as high as they are now during the previous two years, while sales of the ForTwo simply sank by a margin of 10,000 units annually.  Why are they still here?  Mercedes should really think about that.

-Al