With Electric Vehicle Only Approach Looming, Some Smart Dealers Might End Sales

4 months ago by Steven Loveday 24

smart fortwo electric drive

Now that Daimler will only be selling the smart fortwo in its electric configuration in North America, dealers will have to decide if it makes sense to continue sales.

Once September rolls around, Daimler will no longer provide U.S. and Canadian dealerships with any gas-powered smart cars. Dealerships will have until the end of June to make a decision. Daimler will need to be made aware if the dealers are to continue selling the brand, or become service-only dealers. Mercedes-Benz Dealer Board chairman and owner of two smart dealerships in Texas shared (via Automotive News):

smart

smart fortwo cabrio electric drive

“Electric smart vehicles make sense in certain markets, but don’t make as much sense in other markets. So it might make some sense for some dealers to become service-only dealers.”

EVs don’t sell in Texas like they do in California. Schnitzer continued:

“Drive times and range can make a big difference — it’s not like being in downtown San Francisco.”

Smart was initially successful with its fortwo two-seat city car. Keep in mind that this was at a time when gas prices were high and consumers considered fuel efficiency a top priority. The times have changed, gas prices are low, and two-seat city cars are out of style. Penske Automotive Group executive vice president, Tony Pordon said:

“Smart had a polarizing brand — it was a niche product, and it attracted a certain customer. They wanted to grow up with the brand. We did a lot of good things to bring the product to marketplace, but it needed another car. It needed more models.”

Added to this, the ForTwo ED costs about $10,000 more than its gas counterpart. Sure, with the federal rebate the cost becomes more similar, but buyers still have to finance the sticker price up front. This results in an unreasonably high payment for a tiny vehicle that is impractical in many markets. Mercedes-Benz USA CEO Dietmar Exler admitted (via Automotive News):

“It might not make sense for some of the dealers, depending on where they are in the country, to continue. 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.”

The competition in the segment is growing, and analysts have a hard time believing that the micro two-seater will find much success with the new electric-only approach. IHS Automotive predicts much growth for EVs overall, but company analyst Stephanie Brinley only sees smart selling about 1,500 units by 2020:

“They’re definitely going to take a notable hit, but it’s part of larger strategy and a decision to go a bit different with it. Mercedes has been dedicated to keeping smart in the United States for a decade. They haven’t lit the world on fire with this car yet.”

Though smart insists that — at least in densely urban areas — sales could grow. This may prove even more true where local incentives supplement the federal rebate, bringing the price down even further. Annette Winkler, smart’s global boss said:

“Smart can grow — it can grow in the smart cities we are focusing on.”

Winkler and Exler expect dealers in San Francisco, New York, Los Angeles, Miami, and Portland to stick with the microcar brand.

Source: Autonews

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24 responses to "With Electric Vehicle Only Approach Looming, Some Smart Dealers Might End Sales"

  1. Nada says:

    Not surprising as Smart has very little volume and now they wont need oil changes or repairs where dealers make their real money…

  2. Ambulator says:

    It always surprised me that Smart even came in a gas version. It just looks like an electric car.

    1. David Murray says:

      Funny you say that.. I think a lot of people thought those were electric cars early on. And part of the reason was the perception at that time that electric vehicles were golf carts.

      1. Just_Chris says:

        Smart was originally designed by swatch (the watch maker) and was intended to be electric but in the early 1990’s the battery tech wasn’t mature enough so they put a petrol engine in it. IMO the biggest downside to the smart has always been the ICE bit of it – the engine and gear box were awful.

  3. Jim in Wisconsin says:

    I am not so sure many dealers will want to be service only. I could see many just fold the service into their Mercedes Benz maintenance garage.

  4. Some Guy says:

    The Smart is a left-over from the early 90s were the first set of EVs was developed. The original prototype was actually designed as an EV. The ICE was put in as the NiMH option was blocked by patents, thanks to big oil…
    The reason why Daimler discontinues Smart ICE in US is simple. This vehicle is the gasoline car with the highest fine particle pollution ever measured (like 450x above the threshold for diesel vehicles). It actually pollutes more than a modern Semi, imagine that.
    Only in Europe is unfortunately either somewhat legal to kill people like that or the government don’t care so much, so that’s where they are continuing sales…

    1. Just_Chris says:

      I hadn’t realized that there were particulate issues with the smart engine or that the original electric smart was blocked by patents. Both would make sense, are you sure that new smart has the same issues with emissions? The gen 1 and 2 basically had a motor bike engine where as the newer version has a 3 cylinder petrol.

      1. Some Guy says:

        It’s the current engine of the Smart that is the troublemaker. There is the usual cover-up going on, but if someone would measure emissions in a real world driving test, they would find this result.
        ADAC did in Germany, and Daimler did NOT even try to deny the findings
        https://www.wallstreet-online.de/nachricht/9578663-benziner-diesel-dreck-smart-umweltkatastrophe
        There could be real money in this for the US taxpayer, if EPA decides to do some testing similar to Dieselgate, perhaps it’s also worthwhile to test others vehicles from said manufacturer…

  5. Mike I. says:

    I have a hard time understanding why anyone would buy the gas version. I would never want to drive that on the open highway for long distance, so to me, electric is the right powertrain for that car to begin with. If the dealers can’t see that Smart is a city car to begin with and are unwilling to give the electric sales a chance, then good riddance to them.

  6. hpver says:

    We considered a Smart EV way back in 2013. Even then, we turned it down. Tiny car. Low range. No DCFC. High price for what it is.

    We leased a Leaf instead.

    That was over four years ago. I can’t imagine the Smart doing much but limping along given today’s competition.

    1. Just_Chris says:

      +1 on the DCFC but I disagree on the other points. As a city car it is really hard to beat a smart car, perhaps its not for the new world where cities are typically designed around the car but in old European cities it is a fantastic little car. I haven’t driven enough in the states to decide if there would be any advantage top having a smart car in the USA. I suspect there aren’t enough small parking spaces or narrow roads with parked cars along the edge for the smart car to make sense.

      1. Michael Will says:

        In San Francisco it has a clear advantage over longer cars when trying to find parking spots between all the garage exits on a residential street.

  7. DJ says:

    Probably a wise choice given that not many people here buy a Smart car, let alone an EV Smart car…

  8. Brad says:

    I am really sad about this. I am on my third smart and I am in an area where an electric won’t make sense. I don’t want to leave the brand, but I might not have a choice… I certainly worn’t drop the money for a Mercedes… I love the smart brand, but this is a dumb move. I may have to look at Fiat…

  9. scott franco says:

    We leased a Smart EV for a year, then transferred it to another person. To me the car never made sense. As a gas car, the only reason to drive a car that small was fuel economy, back when the gas prices were scraping $5 (this is California). With the EV version, this rationale no longer applied.

    My wife loved the tiny car aspect, but then found she needed a four seater, so we switched to a Spark, which was cheaper, not much biggger, and has four seats/four doors.

    This car makes sense in exactly one place, San Francisco, because of parking concerns.

    1. Asak says:

      The only reason that ever made sense is size. Fuel economy is simply not that great. The smart’s fuel economy is basically on par with a Honda Civic which is much larger and more practical.

      That being said in some cities parking is a real issue and the smart does make a lot of sense in those cases.

  10. bjrosen says:

    The Smart gets pretty lousy mileage for a car that tiny, it rated at 33 city/ 39 highway. Any hybrid sedan does much better than that and they aren’t terrifyingly small like the Smart. The only reason to buy a Smart is if you live in a really dense city where parking is the determining factor in your car choice however if parking is a huge problem for you then chances are you don’t have your own parking space and if you don’t have your own parking space you can’t install an EVSE so an EV Smart won’t work for you. Frankly I think Daimler shouldn’t bother selling Smarts in the US at all, it’s just not a car for America.

  11. peetah says:

    this would be a perfect car for the car sharing company Car2Go.

  12. Don Zenga says:

    Whether all the dealers sell it or not, it will fail. If Benz is really interested in selling, then they would have introduced the electric version of both For-2 and For-4 and priced it affordably.
    This is just an excuse to phase out the Smart make. Who will buy a 2 seater with 85 mile range for $24K when a 5 seater with 215 mile range is available for 35K.

  13. Steven says:

    My municipality (a small town near Philadelphia) has a small fleet of them, probably because you can fit two in one parking space, I can’t think of any other more practical reason. Other that those, I don’t see too many around, so I guess PA is out.

  14. Mark C says:

    I think some dealers will throw in the towel rather than go electric. Sad, because they could be pleasantly suprised if they tried to sell them. I can’t find a new smart EV in the Southeast, none of the dealers I tried wanted to stock/sell any of them.

  15. Bill Howland says:

    I’ve test driven SmartEVs twice and indeed would have bought one if they had come with a decently sized battery… 60 miles doesn’t cut it since my day is too variable to know whether I need to drive 100 miles without charging in between. But for some people I’m sure its great, and everytime I looked, the Smartev’s price was heavily discounted.

    I’m sure the car is right for many people, and since my area has the largest SMART store in my state (unbelievably), I’m assuming they’ll at least continue to sell them here.

    For me, other than the (TOO) dinky battery, its a great solution as a cheap, fun to drive second car.

  16. Ina Schweitzer says:

    I leased a 2014 Smart Electric Druve and I love it. It’s my zip_around car… I drive it all week and plug it in on Friday nights.

    I’m trying to order a new-body style Smart and have to build a 2018 model. They haven’t even sold any 2017s as they haven’t received them, but orders can’t be changed. I was told by the Smart Center in my city that the State of California is only getting 16 Smart Electric Drives fir 2017, only 16 in the entire state…

    Nobody, not even anyone at Smart USA could give me ANY information as far as car prices, lease options, etc, nor could they tell me why their website which lets you “build your Smart” only allows you to build a 2016 model and only on European specs, which can’t be had here.

    I want to order a brown car with red tridion and a red cabrio roof and there are some other options I’m interested in, but options are neatly “packaged.” So, I can’t order the surround sound system unless I order Package P11 which includes a media system with TBA components AND leather seats, which I don’t want. What do leather seats have to do with a media package, I ask?

    Nobody knows anything, I’ve called five Smart Centers. Why are they making this so difficult?

    If Smart is so user-unfriendly to people interested in being environmentally-minded and “smart”, they’re making their own bed and will be lying in it all alone.

    Considering their whole brand is about personality, they don’t seem willing to cater to someone really interested in their product.

  17. Bill Howland says:

    Ina Schweitzer: “…the State of California is only getting 16 Smart Electric Drives for 2017, only 16 in the entire state…”

    That’s amazing. The dealership by me, in suburban Buffalo, NY at one time had over 30 SMART 42 Electric Drives for sale – and that’s only one dealership.

    If interested, look at http://www.smartcenterbuffalo.com when they get done fixing their website. They are on FaceBook in the meantime.

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