Should All Smart Dealers Burn Down Their Lots This Summer?

Matt Posky
by Matt Posky
should all smart dealers burn down their lots this summer

It’s been roughly a decade since Daimler’s Smart Automobile first caressed America’s purple mountains and amber waves of grain with the microscopic Fortwo. Despite a promising first year in the United States, the brand never really managed to carve a space out for itself in a competitive and size-obsessed marketplace. The same is true (over a slightly longer timeline) for Canada.

Standalone Smart dealerships have become a rarity, frequently rolled into Mercedes-Benz sales lots over the years. But both have to ask themselves the same question: Is it worth pursuing sales when Daimler converts the little two-seater into a pure electric later this year and abandons the gasoline engine?

Obviously, the gut reaction is to tell every Mercedes-Benz franchise “probably not” and recommend any standalone Smart dealership immediately consider arson. Small car sales in North America are dwindling and EV sales are miniscule. Claiming a vehicle that exists as one of the least capable examples of both is a good investment is not something any rational person would suggest. But that doesn’t mean there isn’t a place for the unfortunately named Fortwo ED in North America.

“Electric Smart vehicles make sense in certain markets, but don’t make as much sense in other markets,” Ken Schnitzer, chairman of the Mercedes-Benz dealer board and owner of two Smart outlets in Texas, told Automotive News. “So it might make some sense for some dealers to become service-only dealers.”

Schnitzer may want to heed his own advice. His Smart locations may occupy metropolitan hubs like Dallas and Fort Worth, but he noted Texas was not particularly fond of EVs. “Drive times and range can make a big difference — it’s not like being in downtown San Francisco,” Schnitzer explained.

Not to poke holes in the man’s prejudice against San Francisco, but Smart Fortwo ED ownership might actually be easier to live with in his part of Texas. A commuter could theoretically make the round trip between Dallas and Fort Worth on a single charge but a San Franciscan could never make it to another major metropolitan area (except for Berkley) before surpassing the little EV’s 83 mile range on the return trip.

“It might not make sense for some of the dealers, depending on where they are in the country, to continue,” Mercedes-Benz USA CEO Dietmar Exler explained. “That’s something we’re discussing with our dealers. But for electric-important markets, I have not had one conversation with a dealer who would not want to continue.”

Smart cars being relegated, almost exclusively, to major cities is nothing new. But converting them to electric drive pigeonholes them more than usual. Occasionally, you will see a Fortwo making its way down a rural backroad — bravely venturing out of the city on some grand adventure. That won’t be the case with the electric-only models until electric charging stations become ubiquitous.

In fact, the best use imaginable for it is to continue as the staple vehicle for Daimler’s Car2Go urban rental business. Assuming an employee comes along to charge it every few days, it still makes an ideal runabout for city folk. But that doesn’t help dealers.

Daimler wants to keep the Smart EV around to benefit its corporate emissions rating, but it’s going to be a tough sell for customers. People have already turned away from the gasoline-powered Fortwo. U.S. sales were strong in 2008 at 24,622 units, but they plummeted with the price of fuel. Last year only saw 6,211 U.S. deliveries. Canada, which has been a bit kinder to the car, saw 4,080 peak deliveries in 2005 and only 1,875 in 2016.

With the Fortwo ED retailing at $24,550, nearly ten grand more than the outgoing gasoline coupe’s base sum, it’s difficult to imagine who is going to want to fork over the cash. Tax credits and a more refined driving experience will help alleviate some trepidation, but that relief will be short lived when the shopper realizes the Fortwo gives up its biggest advantage as an EV.

The best thing about microcars is easy on-street parking in densely populated cities. It’s the primary reason you still see so many Smart cars in New York. The best thing about owning an EV is being able to charge your car in your home garage. If you’re frequently parking your vehicle on the street, odds are good you don’t have a car port with an easily accessible outlet and nobody is going to want to drive twenty miles through city traffic to wait two hours to recharge their Fortwo.

Need more proof that this is a bad idea? InsideEVs claims Smart only sold 54 electric models within the United States between January and May.

Exler remains hopeful, however. He expects some of the gasoline-model demand to migrate over to the Smart EVs. “We’re hoping they will come up quite a bit from that point,” he said. “How high they go, we will have to see.”

[Image: Daimler AG]

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  • Cash Cash on Jun 19, 2017

    I rented the four-door version for a week in Sicily a while back. It had a surprisingly large and well-done interior. Made it seem as if it were a much much larger car. Also had a turbo so it was fun to drive. I couldn't remember the last time I drove a car where I felt I was going too fast for the kind of vehicle I was driving.

  • MrSmartLA MrSmartLA on Jun 23, 2017

    Matt, the "Inside EV's" data does not explain anything other than raw numbers. Unfortunately your opinion was based on a lack of perspective. The smart EV "only sold 54" models between January and May primarily because the smart EV was SOLD OUT NATIONWIDE all year. This is very important information that you left out of your article because you did not know that the smart EV was essentially sold out. Your article worked under the assumption that nobody wanted the car when that assumption was not true at all.

  • MRF 95 T-Bird As the former owner of an 87 Thunderbird with the 3.8 that was quite reliable and served me well for over a decade I can attest that this Turbo coupe is a fair deal. I used to frequent the TCCOA site for service and parts information and it’s filled with folks who know these cars. Parts for them are mostly right off the shelf Fox body items except for some of the Turbo coupe only items like the electronic suspension items. Just clean up and bring back to the original brushed aluminum finish those nice 16” wheels. Geez not every thing has to be “murdered out” dude bro culture.
  • SCE to AUX Obviously, yes. But they can't think about it for 5 years.A hybrid RAV4-based truck would be very competitive.But the real question is whether Toyota wants to undercut profits by selling such a vehicle. Mavericks aren't rare because Ford can't build them; they are rare because Ford makes more money on their other vehicles and therefore doesn't want to build Mavericks.
  • Redapple2 C2 is the best. C3 next. Then C7 (looking at you jimII).
  • Jeff S Vulpine--True the CAFE rules are for ICE.
  • Gray I grew up in the era of Panther and Fox platforms. If only they developed a good looking two door Conti. The four doors became a cult in their own right. And kept the 351W as a top line option.
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