Smart ForTwo Sales Finally Slow Down

Introduced to the US market in January 2008, the tiny Smart Fortwo has been a huge hit. Recently, orphaned cars have begun to pile up at car dealerships as potential buyers decide to keep their refundable $99 deposit money.

Introduced in January 2008, Daimler’s Smart Fortwo was an instant hit, nicely timed as high gas prices climbed upward. By last summer, Fortwo’s were zipping off of dealer lots as four dollar gasoline prices encouraged consumers to embrace the diminutive two seat models which are powered by a 1.0L three cylinder engine.

Lately, sales of the Fortwo have dropped with an increasing number of orphan cars stacking up at Smart dealerships across the country. Smart’s unique way of selling cars is chiefly done through the internet where customers put down a refundable $99 deposit to hold their car.

Orphaned Smart ForTwos Sit On Dealer Lots

When customers decide against purchasing an available Fortwo, the cars are effectively “orphaned” and made available to the next waiting customer. That person can choose to buy that model or wait for one to appear to their liking.

Right now Smart says that they have a 28 day backlog of Smarts, double what they had last summer. Still, the Smart Fortwo is one of the fastest selling cars on the market, selling much faster the industry average of 95 days.

Not In The Buying Mood

The drop in demand for the Fortwo isn’t coming as a surprise to most analysts. With gas prices now less than half of what they were last summer and the economy in the tank, few consumers are in the mood to buy. That may all change if a congressional car scrap program gains passage and/or gas prices begin to climb once again.

Worldwide sales for Smart rose by 39% in 2008 and the car is now available in 41 countries. Parent Daimler is also developing an electric version of the car, testing prototype models in London, Berlin and Italy. Those cars are powered by a lithium-ion battery. Full scale production has yet to be announced.

Sources: USA Today and Daimler AG

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