STUTTGART – The original two-seat Smart ForTwo minicar, which will get a successor model by 2007, will be at the heart of Smart’s new growth strategy.
The new model, which insiders say will be slightly longer, will use the same platform architecture as the current model, said Smart boss Ulrich Walker.
Further cost savings will be achieved by using a new Mitsubishi-sourced three-cylinder gasoline engine. The diesel engine will remain unchanged.
A hint of the new ForTwo’s design is expected to be given in a concept model at the Frankfurt IAA in September.
DaimlerChrysler, Smart’s parent company, announced a turnaround plan for the loss-making brand on April 1. It killed development of a new model, the ForMore, postponed a move into the US and embarked on a series of cost-cutting measures.
But Walker hasn’t given up on the US as he looks for new markets.
Smart’s dedicated plant in Hambach, France, has capacity to build 120,000 ForTwos a year, but produces only 80,000-to-90,000 units a year. Walker wants to improve capacity use when he starts building the ForTwo successor.
“We want to bring the car to the US,” Walker said. “Therefore, we are developing it with that market in mind.”
He added that exports could be targeted at specific regions such as California, Florida and the north-eastern US. A decision to export to the US is months away, however.
Smart’s other model, the ForFour small car, is even doing worse than the ForTwo. The four-seat model, which is built at Mitsubishi’s NedCar plant in the Netherlands, has been selling well below its target of 150,000 a year. NedCar supplied only 27,000 units through May. The ForFour shares a platform with the Mitsubishi Colt.
Walker cited weakness in the small-car market, but dealers and distributors said the ForFour doesn’t have the brand image of its smaller sister, the ForTwo.
“The Smart name is related to the ForTwo,” said Dwight de Weerd, director of sales for Smart at DaimlerChrysler Netherlands.
“For that reason, the ForFour is unknown to customers in the compact-car segment. The ForFour is simply not on their shopping list.”
An additional problem for Smart is that its dedicated sales network is limited to larger urban areas. “The network does not cover the needs of potential customers for the ForFour in the countryside,” Walker said.
To remedy that, Smart is now considering setting up shop-in-shop Smart outlets at Mercedes-Benz dealerships.
These would be in addition to the brand-specific Smart towers that adorn the company’s traditional showrooms.