This week I will publish two reviews of the automobiles I drove over the last two weeks, and though neither of these cars are available in the US, I believe they both hold fascinating lessons that are highly applicable and relevant to both the US market and the global auto business. But in the meantime I thought I’d share this picture, which would be near impossible to take in the US, and which speaks volumes about the evolution of small cars. Just blocks from Paris’s Place de la Concorde, in front of Chanel’s flagship Parisian boutique, I was able to capture a classic and modern Mini, with a Smart ForTwo sandwiched in between for scale.

I’ll leave commentary on this image to TTAC’s Best and Brightest, but I will say that the tableau stopped me in my tracks. Though I’ve always loved the classic Mini, and I have only the deepest admiration for those who keep these wonderful cars in daily use, this image confirms just how much our automotive expectations have changed. If you think a Smart makes undue compromises in the pursuit of its city-friendly size, imagine what an original Mini must be like in today’s traffic….

Scion is quite sure of one thing: the new iQ is a much better car than the smart fortwo. What they’re much less sure of: how many of the targeted fine young North American urbanites will buy one rather than periodically use Zipcar. I’m neither young nor urban, but I’m going to do my best to pretend. Why might I buy this car—or not?

Exterior styling – not

Toyota fits the iQ with 16-inch wheels that can be upgraded to multi-spoke alloys in a bid for the intended buyer. But the exterior isn’t nearly as stylish as the smart’s, with a frumpy nose, awkward B-pillar, and a single, square-cut door filling nearly the entire space between the wheel openings. Add the relatively large wheels, and the whole looks like a Photoshop chop—except it’s real, with a 79-inch wheelbase (vs. 74 for the smart) and 120-inch overall length (vs. 106). Scion has been struggling to get its mojo back ever since launching the bloated second-gen xB. With the iQ the struggle continues.

Interior styling – maybe

The interior is more successfully stylish than the exterior, but still has none of the whimsical character you’ll find inside a 500 or a MINI. All of the surfaces are—surprise—hard plastic but they generally look and feel solid. The red-stitched leather-wrapped steering wheel and the glossy black trim on the doors and center stack are high points. The controls are simple and easy to use, with three large vertically-aligned knobs for the climate controls. Less functional: the driving position is well aft of the windshield, so traffic lights aren’t visible if you stop at the white line. The button to temporarily deactivate the traction control (but not the stability control) is mounted low on the far side of the shifter. A power lock button sits next to it, but there’s another more conveniently located on the driver’s door. My suspicion: the design initially included only the button on the console, in line with European practice, but the Scion marketing folks insisted on having buttons on the doors, where Americans expect them. They got half of their request.

Interior packaging – where the car earns its nameplate

I’m a space efficiency geek. The intelligent packaging and seating of the Ford Freestyle and Taurus X is perhaps the main reason (beyond the need for seven seats) that I bought one of the latter.

Toyota is most proud of its packaging innovations for the iQ, and this part of their pitch for the car is not hype. Though only a foot longer than a smart, the iQ has a rear seat that can fit one adult without resorting to cruel and unusual punishment, and two with it. They were able to pull this off by:

1. Placing the engine in the nose of the car (it’s in back with the smart) and locating the differential ahead of the transmission, which sits next to the engine. This enables an unusually short front overhang, and would improve the appearance of even large front-wheel-drive cars. (Back in the 1990s, GM’s designers wanted to flip transverse powertrains around for this very reason, but the engineers refused to enable any such silliness.) A special high-mounted steering rack also plays a role.
2. Compacting the A/C componentry and locating the evaporator behind the center stack rather than ahead of the front passenger, enabling the right front seat to be shifted forward a few inches. Which is why the right rear passenger enjoys more legroom than the left rear passenger. Space is provided between the front seats for the left rear passenger’s legs, as the driver’s seat can slide all the way to the rear seat cushion. This space exists because, with a width of 66 inches, the iQ is over a half-foot beamier than the smart. A by-product: those in the front seat sit about as far apart as they would in a C-segment car like the Corolla, not shoulder-to-shoulder like they do in the smart.
3. Developing ultra-thin seatbacks. They don’t feel substantial, but aren’t uncomfortable.
4. Developing an ultra-thin fuel tank—it’s only 4.5 inches tall—and locating it beneath the driver’s seat.
5. Adding an eleventh airbag that deploys over the rear window, essentially a rear curtain airbag. There are only a couple of inches between the rear seatbacks and the liftgate, so otherwise the rear seat would be dreadfully unsafe instead of…

Of course, Toyota’s engineers can’t do magic. So without folding at least half of the rear seat there is absolutely no cargo room.

Electronics – good, but better gadgetry on the way

Bluetooth (hands-free phone and audio streaming), USB, and HD radio are all standard, while nav is available as a dealer-installed accessory. But something like Toyota’s new Entune system, with Internet-based apps, is a year or two away.

Performance – quicker than a smart!

The iQ weighs only 2,127 pounds, but this is still a bit much for the 94-horsepower 1.3-liter four-cylinder hitched to a mandatory CVT. (The smart weighs 300 pounds less, but has only 70 horsepower.) In normal mode the CVT produces the rubber-banding effect typical of CVTs paired with small engines. Shifting into S largely eliminates this while also kicking the revs up a grand or two (so it’s not a full-time solution for anyone interested in fuel economy). And if you want to keep the small four at high boil there’s B (intended for engine braking on downhill grades) that further bumps the engine speed. Not the ideal transmission, especially not for driving enthusiasts, but far better than the clunky automated single-clutch manual in the smart. The engine sounds better than that in the Nissan Versa, which similarly employs a CVT, but remains well short of spine-tingling. There’s no joy in winding this one out. Sixty arrives in an acceptable ten to eleven seconds, but acceleration trails off considerably past that mark.

Fuel economy – very good in the city, meh on the highway

Scion touts the iQ’s fuel economy as the best of any non-hybrid. But the EPA rating of 36 city is much more impressive than the 37 highway. Then again, the iQ is marketed as a “city car,” not a “highway car.”

Handling – not remotely a new CRX

The best that can be said of the iQ’s handling is that its ultra-tight 12-foot turning radius, roughly two-thirds that of the average car, is truly a joy to experience. The second best: unlike the smart, the tiny Scion drives much like a regular car. Perhaps too much like a regular car, if by “regular car” we mean a Camry. Aided by the car’s unusually high width-to-wheelbase ratio, roll and understeer in hard turns are both moderate. But the steering is neither quick nor communicative, handling isn’t particularly agile, and the non-defeatable stability control cuts in well short of the car’s limits. The legendary Honda CRX was a thrill to drive sideways. That won’t be happening here. The iQ drives like an appliance.

Ride – survivable

Given the iQ’s ultra-short wheelbase, a choppy ride is a given. Drive over 60 down a concrete freeway (again, not the car’s primary mission), and expansion joints induce a rhythmic bouncing. But otherwise ride quality isn’t bad, and doesn’t feel like that of a very small, very light car. Though larger and heavier, a FIAT 500 rides worse.

Pricing – bespoke bits aren’t cheap

The iQ lists for $15,995. Scion continues to practice “Pure Pricing.” This doesn’t mean that dealers cannot discount, only that they must offer the same price to everyone. A similarly-equipped smart fortwo lists for $16,850. Adjust for the iQ’s additional features using TrueDelta’s car price comparison tool, and its advantage widens to a considerable $2,300.

But Scion rightly isn’t taking the smart seriously as a competitor, at least not in North America. Here stiffer competition will come from the Fiat 500 and B-segment cars. The much more entertaining Mazda2 costs a grand less, though a $1,600 feature adjustment gives the iQ a $600 advantage. Compared to a FIAT 500 Pop, the iQ is $1,000 less before the feature adjustment, $400 less afterwards. So the prices for these three are quite close before discounts and incentives—which will tend to favor the Mazda and (as the cars pile up on dealer lots) the FIAT.

Bottom line: The iQ costs about as much as B-segment cars despite being much smaller and less fun to drive.

Sales forecast – not promising

So, the Scion iQ isn’t going to sell based on its price or driving excitement. Its packaging innovations are impressive, but you don’t have to own the car to admire them. Though the iQ is a much better car than the smart fortwo, the latest B-segment cars are better still in nearly every way. In terms of fuel economy, the iQ does very well in city driving, but the larger cars do better at higher speeds (where the Scion is out of its element). In the end, the iQ’s key strengths are its short length and ultra-tight turning radius, both of which make it easy to park in the city. But how many people have ease of urban parking as their top priority AND will be buying a car rather than occasionally renting one?

Scion provided the vehicle, insurance, and fuel for this review at a media event.

Michael Karesh operates TrueDelta, an online source of automotive pricing and reliability data.

Under Penske management, the Smart minicar brand sold fewer than 6,000 vehicles last year, capping a sales decline that led Mercedes to take back management duties for the brand. And, according to the new folks in charge of Smart, there’s only one real problem with the brand: awareness. Or, more precisely, lack thereof. We’ve heard this song before from Smart’s new GM, but now Ernst Lieb, boss of Mercedes U.S.A., is picking up the tune, telling Automotive News [sub] that

With the marketing activities that we’re going to have, we’ll see some positive momentum. The biggest problem the car has right now: Nobody knows it.

Which, of course, is nonsense. Nonsense that allows you to appear aware of the sales problem without acknowledging a single problem with the product itself, but nonsense none the less. And Smart’s not the only micro-car brand that’s reaching for it either, as Fiat-Chrysler marketing boss Olivier Francois has the exact same excuse for Fiat’s weak start, telling AdAge

I don’t think we have a car problem; people love the car. I think we have an awareness problem.

Are Americans incapable of seeing, recognizing or being aware of anything that weighs less than 3,000 lbs? Or is it possible that there are a few things wrong with the Smart and 500?

Let’s start with Smart. The brand will spend between $25m and $35m on its new campaign, which includes the ad at the top of this post, in hopes of bringing sales up to about 10k units per year. But one has to wonder: what is the difference between the new “unbig. uncar.” ad and the old “Think Small” tagline? Smart swears that its JD Power data shows 50 percent of consumers are “unaware” of its brand, but of the 50% that are aware, how many don’t realize that Smarts are small cars? I’d guess none. Besides, Smart would be incredibly lucky if 50% of Americans lived in circumstances that allowed them to consider owning a non-sporty two-seater that’s not cheap, not especially efficient, takes premium gas and has a notoriously unpleasant transmission. Like electric cars, city cars have a relatively small potential market due to their fundamental attributes; you don’t need an 80%+ awareness rate to find the few people who can use, afford and appreciate such a niche product.

Fiat, meanwhile, is actually benefitting from a lack of awareness… of what a mess its entire marketing campaign is. After starting off with an advertisement that was so horrifically dull Chrysler had to take it off of Youtube, Fiat handed things over to a small firm called Impatto… which apparently melted down into a complete sideshow. How bad are things? Fiat-Chrysler’s global marketing boss, Francois, is taking charge, and when asked what’s happened to Fiat’s US brand manager Laura Soave, Chrysler spokesfolks say

To my knowledge, Laura is still on board.

Yikes! But then, it might not be fair to put all the blame on Soave’s shoulders… after all, Francois is hardly setting the world on fire by plastering the J-Lo ad seen above all over football games. As if to confirm that marketing positions require the ability to uncritically chew your own bullshit, Francois claims

Listen, I’m not a great fan of using celebrities at any cost. I prefer a good idea to a bad celebrity. I used to say endorsements are lazy when you have no idea. But that’s not the point — from time to time you have a magic association. I like to take a celebrity because the celebrity’s story fits with the story.

And yet you have J-Lo selling a 100 HP cutesy-mobile during football games. And the NY Post reports the brand was planning on giving cars to “influencers” (read: celebrities) and then having TMZ photograph them, not to mention

planning celebrity drive events in the Hamptons this month and star-studded parties at Miami’s SoHo Beach House in October where celebs can drive the car. Fiat USA is also a Miami Fashion Week partner.

Sounds a lot like the 500′s marketing plan is “celebrities at all costs,” rather than all the BS about “magic associations”… although Francois denies any involvement in the paparazzi scheme, telling AdAge

I think there is a true part of the story and a totally invented part of the story. The paparazzi part is crazy to me. Maybe there had been internal talks but I was not involved. We were going to give the opportunity to some opinion leaders to drive the car. We have a lot of requests, around L.A. especially, to drive the car. It’s nothing but good to have opinion leaders driving your car. I don’t know what happened, but it spun out of control.

Between Smart and Fiat, we have two brands that face challenges going into the market due to limited product offerings with limited appeal to US consumers. In the case of Smart, the marketing has always been decent… “Think Small” was a great tagline, and the latest ad proves there’s no better way to sell a car like the ForTwo. But because the original marketing was good, the new marketing is nearly identical, and the product hasn’t changed, don’t look for Smart to go anywhere in its battle for awareness.

Fiat, on the other hand, has made such a colossal mess of the 500 marketing campaign ever since it arrived in the US, a complete marketing re-boot could probably yield some kind of benefit. But clearly Soave and Francois are fresh out of ideas… Fiat-Chrysler needs to get some very smart people studying every marketing move MINI has ever made in this country and then rebooting the 500′s marketing from scratch. After all, when you’re selling niche products, awareness isn’t enough… consumers need to want the product so badly, they’re willing to put up with its downsides. Being aware of its cuteness alone isn’t enough. For a brand like Fiat, with a product like the 500, talking about the problem in terms of “awareness” simply proves how badly they’ve bungled the entire effort. And that it’s time to start over from scratch.

For most Americans, the term “small car” typically refers to a C-segment sedan like the Honda Civic or Ford Focus, cars that now qualify as midsizers in many key metrics. Subcompact, or B-segment cars are generally considered the smallest of the small, as their name implies… but ask an American to describe a car smaller than a subcompact, and they’ll likely look at you quizzically before hesitantly suggesting “Smart car?” Yes, the A-Segment, known in Europe as the “City Car” or Microcar” class, is such a rarity in the US that it’s basically synonymous with the one car “competing” in it (Fiat’s 500 hasn’t quite broken into the public consciousness yet).

But, with Chevy execs confirming once and for all that the on-again-off-again (for the US) Chevy Spark (a.k.a. Daewoo Matiz Creative) will in fact be sold in the US (likely as a 2013 model) early next year, the American A-segment is about to get a whole lot of attention. But the question is this: does the fact that America’s first new A-segment car in a decade is a Chevy help or hurt the segment’s chances (consider that previous US A-segment cars like the 500 and Smart are positioned as premium offerings)? Is this car, with its 80 HP/82 lb-ft, 1.2 liter engine a pioneering game-changer that will introduce America to a whole new world of tiny cars, or is it just CAFE compliance fodder? One thing is for certain: everyone from Hyundai to Ford (which have the i10 and Ka waiting in the wings) is going to be watching the Spark with great interest.

Despite losing $600m, Vauxhall/Opel is planning for the future. They’re bringing the Chevrolet Volt to Europe and they expect to be back in the black by 2012. Now, it appears, they want to fill that hole in their lineup. You know? That city car sized hole? Just below the Corsa.

Autocar reports that Vauxhall/Opel is building a three door city car using parts from the Corsa and Astra. The raison d’être for this car is “premium”. Vauxhall/Opel wants this car to have a sophisticated infotainment system to give it a premium feel. To show how serious Vauxhall/Opel are about this project (which is code-named “Made in Eisenach”), they’ve invested €90m in GM’s Eisenach plant (now can you see why it was code-named “Made in Eisenach”?) to expand its build volume by 80,000 to 90,000 units per year. The volume they hope to sell of this new car. Says Nick Reilly, Opel/Vauxhall CEO,

This is a further milestone in the growth strategy for our business. Our €90 million investment in the Eisenach plant will significantly strengthen its role within European manufacturing network and will offer customers a brand new model with innovative technology and exciting design.

Autocar also reports that in February, Vauxhall/Opel announced that the city car concept would be showcased at this year’s Paris Motor Show. Paris Motor Show came, but the city car concept didn’t. But Vauxhall/Opel said that despite the failure to show up at the Paris Motor Show, it will come to production by 2013. Quite what this means for the Vauxhall/Opel Agila (which is a city car that is actually a Suzuki Wagon R or Splash, depending which generation you’re talking about) is unclear. After all, why spend all that money developing a city car of your own, when you already have one to sell? Maybe because the man who made the Suzuki Splash-to-Opel Agila transformation has since been poached by Suzy’s newest partner, Volkswagen. Besides, an upscale replacement might just have potential as an American-market Buick down the road. At least as long as a Buick micro-car isn’t too outlandish of a concept…



VW’s biggest news from LA today is the Up! Lite, no doubt designed by some uptight Germans intent on bring a strange looking, Germanically efficient vehicle to the shores of America (or Poland). Obviously a result of VW’s development of a 100+MPG 1+1 seater car, the 70 mpg Up! Lite makes up for its homely looks with in-town efficiency. But then its main competition, the Toyota iQ and Smart FortTwo aren’t exactly lookers themselves. Under the hood lurks a 0.8L TDI engine and a 10kw electric motor making for leisurely acceleration despite the featherweight kerb figures.

I have driven a Spark around Michigan and have had some (GM executives) out for Saturday afternoon driving. We’ve cruised Woodward. North America has been an on-and-off thing for (the Spark). At the present time, though, it is very much on. Most of the world’s minicars were not designed for North America. The safety and repairability standards are different for side, rear, front crash and rollovers, as are emission standards and other things. They are difficult to meet if they weren’t planned for in the original engineering build. We can meet the U.S. standards. We can even package the Spark for Big Gulp cupholders

GM’s Jack Keaton [via Wards Auto] on the Chevrolet Spark (neé Daewoo Matiz Creative) and the many modifications needed to ready the 1.0/1.2-liter A-segment hatchback for the US market. Including making the cupholders large enough to hold a soft drink cup that’s nearly double the displacement of the Spark’s engine. The 6′ 4″ Keaton swears the Spark’s front seat is comfortable for him, and that he “didn’t mind” the back seat on a recent 35 mile drive.