More than two-thirds of U.S. Smart retail outlets have opted to stop selling Daimler AG's microcar brand after it switches this year to offering only electric vehicles here. The shakeout will leave Smart with just 27 dealerships, fewer than even Lamborghini and Lotus.
Mercedes-Benz USA, which distributes Smart in the U.S., asked dealers to decide by the end of June whether to continue selling the ForTwo two-seater, the brand's sole nameplate. Of Smart's 85 outlets, 27 said they would remain, while 58 said they would move to a service-only operation, said company spokeswoman Donna Boland. Those numbers are preliminary, she said.
The 27 remaining Smart dealerships are largely concentrated in states with zero-emission vehicle mandates and that give Smart "the highest market penetration potential," Boland said. Daimler executives had said they expected the remaining dealerships to be in cities such as San Francisco, New York, Los Angeles, Miami and Portland, Ore.
Penske Automotive Group, which launched Smart in the U.S. in 2008 as an independent distributor, is dropping sales at five of its six U.S. outlets, according to Tony Pordon, Penske's executive vice president of investor relations and corporate development. Penske will continue selling Smart in San Diego, which has higher EV sales potential.
The dealerships that end Smart sales will continue to provide service for Smart owners. They will transition to service only as they sell out of inventory, with the "vast majority" expected to have transitioned by year end, Boland said.
Smart announced in February it would drop gasoline-powered models in the U.S. and Canada and move exclusively to EVs this summer after exhausting inventory of the old models.
The decision reflected falling sales for the ForTwo as low gasoline prices fueled demand for SUVs and crossovers. In 2016, Smart sold 6,211 ForTwos in the U.S., down 17 percent from a year earlier, for an average of 73 per dealer. Sales this year through July are down 30 percent from a year earlier, to 2,165 cars.