By on March 26, 2019

2017 smart fortwo cabrio electric drive (Euro spec image)

According to a report out of Germany, we’ll know by the end of the year whether Daimler AG intends to keep its Smart city car division alive.

Created a quarter century ago, Smart’s focus on microscopic urban runabouts like the Fortwo gave way to a plan to go all-electric in Europe by 2020, two years after ditching gasoline in North America. However, there’s a chance the automaker’s incoming CEO might relegate the badge to the scrap heap of history.

German newspaper Handelsblatt (via Automotive News Europe) reports that, in a time of belt tightening, Smart’s money-losing ways are weighing heavily on Daimler brass.

According to a company insider, the automaker’s future CEO, Ola Kallenius might pull the plug after replacing the mustachioed Dr. Z in May. Kallenious has “no scruples about killing the brand if necessary,” the source claimed, adding that Dieter Zetsche’s successor has no history with the brand.

Daimler doesn’t make a habit of revealing Smart’s financial performance, though analysts claim the division’s losses amount to billions of dollars since its creation. A report late last year pointed to another potential nail in Smart’s coffin: Daimler’s partnership with Renault. The current-generation Smart Fortwo and overseas-market Forfour share their architecture with the Renault Twingo, but that partnership could soon dissolve, reports claim.

Such a move would leave Daimler hanging; the cost of going it alone would surely seal Smart’s fate.

Globally, sales fell 4.6 percent in 2018, but the move to an all-electric Fortwo in North America for 2018 saw the bottom drop out of domestic Smart demand. With the Fortwo boasting a range of just 58 miles, it’s not surprising. U.S. Smart sales, ironically, fell 58.5 percent in 2018. Through the end of February, some 141 Smarts found buyers in the United States — down 32.2 percent from last year’s already diminished year-to-date volume.

[Image: Daimler AG]

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20 Comments on “Smart’s in Danger, and Not Just in North America...”


  • avatar
    jatz

    And they’re expensive.

    Nobody adds insult to injury like Germans.

  • avatar
    indi500fan

    Billions in losses.

    Honestly anybody driving one gets classified as being in the penalty box.

    Some small cars like Mini and Fiat get called “cute”.

    This one never made the cut.

    • 0 avatar
      Roberto Esponja

      And that’s the thing, it started out “somewhat” cute, but they made it uglier as time went by. Reminiscent of what GM did with their models from the mid 1960’s onward, actually.

    • 0 avatar
      sgeffe

      My church’s Music Director and his wife, a professional opera singer, own one of each! He only has a 2 mile round-trip to work, if that, so he has a first-generation fourtwo, and his wife has a 500. They use the Fiat for trips, as by his admission, anything but short freeway runs are a bit uncomfortable.

      Even having to dump premium gas into the smart, he still only fills the tank once a month, so he’s the perfect use case for one of those!

      Still and all, the idea of the smart was…dumb!

  • avatar
    dukeisduke

    It’s never really been that successful. Considering their size, fuel economy is disappointing, and they’re overpriced. Look at the used electric ones for sale on places like Cars.com – the depreciation curve on those is practically vertical.

    The first- and second- generation cars weren’t too bad looking, but the third-gen is hideous.

    The whole concept has been on life support for some time.

  • avatar
    MoDo

    The only niche these were able to carve out in north America was usage as pit vehicles for drag racing teams. Bought used they are cheaper than golf carts and can be driven into town to buy food or parts.

    • 0 avatar
      jatz

      Nah.. they were slightly popular in university communities for profs and grad students scooting between home, school and organic food joints.

      A niece had one in Denton when she taught at UNT. We were all so relieved when traded it for a Fit and even more so when she married a guy with an Expedition.

  • avatar
    Arthur Dailey

    In the GTA at one time they had lease deals on these at around $140 per month. Very tempting as a 3rd vehicle or run around at that price.

    Last month spoke to a guy who was driving one and he said that with the right tires, it was excellent in the snow. There are actually about 4 just in my general neighbourhood. Personally I would prefer, a ‘real’ vehicle with at least a modicum of space for groceries, etc.

    Reports from my mechanic are that parts are pricey (as per M-B tradition) and the CVT transmission is problematic. Often the cost of repairs being greater than the value of the vehicle.

  • avatar
    eggsalad

    There was a moment, at least here in Vegas, where the leasing arm of MBUSA was ditching off-lease smart ED (love that abbreviation!) for absolutely dirt money. At retail, 3-year-old, 20k-mile examples were selling under $5k. I *very* seriously considered one, went so far as to take a test drive. It was a fine urban pod, and it overcame the ugly issue of the transmission on the gas smart.

    HOWEVER… when they were sold or leased new, the battery pack was *always* under a $99/mo separate lease. Nobody could really tell me if that was still the case when they were sold used. The smart forums didn’t have a concrete answer, and neither did the folks at MBUSA!

    For that reason, I wound up walking away.

    • 0 avatar
      SunnyvaleCA

      A colleague of mine leased an ED a few years back. The out-the-door lease price was something like $119/month. Yeah, really! The only catch was that the insurances was something like 2x that much because no mechanic wants to electrocute themselves.

      Wasn’t the European diesel version of the Focus ST called the STD? That’s a TLA that doesn’t translate well in the US.

  • avatar
    Kendahl

    The Smart might have had a purpose in centuries old European cities with narrow streets. It failed in North America because you could buy a real car for the same or less money.

    • 0 avatar
      glennmercer

      Exactly correct. A Daimler executive told me years ago the city where smart had the highest market share was Rome, where there zilch parking spaces, and what spaces there are, are in narrow streets. Last time I was in Rome it seemed like every 4th car was a smart. It is interesting: the first-ever car whose greatest value is delivered when it is NOT moving…

  • avatar
    Garak

    The Roadster was the only desirable Smart, so of course they killed it off.

  • avatar
    APaGttH

    The A-segment cars in this class all are failures of failed in NA. Scion iQ was close to this size with its peculiar 3+ seating arrangement and was also very short lived.

    All the reasons why hashed out above. No real advantage in fuel economy, the biggest competitor is the B-Segment car sitting next to it on the showroom floor, penalty box on wheels defined.

    The target demographic for buying these is extremely small, and I would suspect in urban canyons, walking, Lyft/Uber, and mass transit simply negate the need completely.

  • avatar

    So Smart is DB’s Saturn, in sense of losing billions and never ever making profits.

  • avatar
    Charliej

    There are quite a few Smarts down here in Mexico. They are very popular in our narrow streets in the local villages. You see someone in a pickup having to back and fill three times just to turn right at the corner. It makes sense when you think about the village being over four hundred ninety years old. Streets used to be much narrower and they have not got any wider over the years. Smarts and Nissan Marches are the cars that make sense here. I leave my Ford Escape at home most days and just ride my Honda motor scooter. It goes placed the Smart can’t. By the way, I am in my mid seventies and hoping to last for at least the next three years. I want to be around for the five hundredth anniversary of the founding of my town.


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