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Joe Atlanta

WSJ: smart WILL launch fortwo in East & West USA in 2007

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I didn't look at today's paper until 5:00 this afternoon, which has the best

news in years. This is from the Sat./Sun. June 24-25 2006 Wall Street Journal.

In the "What's News" column on page 1 it says: "DaimlerChrysler plans to launch

its tiny, two-door Smart in the U.S. next year in a bid to turn around the

small-car unit"

The 9 paragraph full article on page A2 starts with: "DaimlerChrysler plans to

announce next week that it will launch its tiny, two-door Smart in the U.S. in

2007, a bid to turn around the small-car unit, people familiar with the matter

said."

They must have seen the gas prices here in the US and remembered what business

that they are in. We are glad that you woke up Dieter! And this is right at

10 years to the day that I saw the "swatch-mobile" prototype at the Swatch

Pavillion at the 1996 Atlanta Olympics.

More later,

Joe in Atlanta

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Here is the WSJ on line article:

Autos

Will Chrysler's

Move Be Smart?

By NEAL E. BOUDETTE and STEPHEN POWER

June 24, 2006; Page A2

DaimlerChrysler AG plans to announce next week that it will launch its tiny, two-door Smart car in the U.S. in 2007, a bid to turn around the unprofitable small-car unit, people familiar with the matter said.

Making the Smart car business profitable has been an important task for Chief Executive Dieter Zetsche since he took the top post Jan. 1. The unit has been unprofitable every year since its first model in 1998.

Efforts to turn around the unit in the past few years have saddled DaimlerChrysler with more than €1 billion, or about $1.25 billion, in restructuring charges. Smart, which is run by the company's Mercedes division, was a main reason for Mercedes's loss of €505 million in 2005, the luxury-car division's first annual loss in more than a decade.

A U.S. launch could help lift sales, but it is unclear if that will be enough to make Smart profitable. According to people familiar with its plans, the company has reached an agreement with a U.S. company to manage distribution and sales of the car. It will be sold in major metropolitan centers on the East and West coasts where sales of small, imported cars are strongest.

High gas prices have spurred sales of small cars, but several competitors have beaten Smart to the U.S. market. General Motors Corp.'s Chevrolet Aveo was introduced in 2004, and was followed this year by the Yaris from Toyota Motor Corp. and the Fit from Honda Motor Co. All three sell for $10,000 to $14,000. It may be difficult for DaimlerChrysler to make much money if the Smart is priced in that range because the car is made in Europe. The euro's strength against the dollar makes European exports to the U.S. expensive.

"The exchange rate does work against them," said Walter McManus, the head of automotive analysis at the University of Michigan's Transportation Research Institute. But with gas at $3 a gallon, "cars like this become very attractive, especially in an urban setting."

Earlier this year Mr. Zetsche said he would announce a decision by the end of June on whether to bring the colorful, two-toned Smart to the U.S.

In an interview with The Wall Street Journal in January, Mr. Zetsche said that if DaimlerChrysler brought the Smart brand to the U.S., it wouldn't set up a separate dealership network for it, as it did in Europe -- a costly decision intended to help Smart create its own brand identity, but one that many industry analysts now fault.

Instead, DaimlerChrysler has sought a partner, such as a dealership chain, to help sell the car in existing Chrysler and Mercedes showrooms. BMW AG used a similar strategy when it encouraged its BMW dealers to add showrooms to existing facilities to carry its Mini line.

Write to Neal E. Boudette at neal.boudette@wsj.com5 and Stephen Power at stephen.power@wsj.com6

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I really hope this is true, and in the case of Orlando they stick to the MB dealerships, cause frankly, the Dodge/Chrysler/Jeep stealerships in Orlando stink. I also hope they don't copy BMW's mistake by not releasing it initially in all US districts like they did with the Mini (the Mini wasn't available in dealerships outside of the 50 states for more than a year after its release, causing a backlog in Florida dealerships getting export orders to Puerto Rico and the USVI). I could really see the fortwo getting very popular in San Juan.

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Woo-Hoo! That is the best news since they announced in February 2004 that the car actually WAS coming to Canada!

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That's great news! I have no doubt that the smart will be a huge success on your side border---at least on both coasts. I base my optimism on the reactions of American tourists in Victoria B.C.---overwhelmingly positive.

It will be interesting to follow the upcoming details of smart's distribution plans.

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And now the real "HARD" waiting begins...and the nail biting...

Congrats!

S

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And still no mention of which engine it will be optioned with, the news is good, but not great yet. When I can fill it with kerosene/motor oil mix or Canola for emergency fuel, I'll be signing up. After the Katrina fiasco down here in Montgomery last fall, I will be very sceptical of any thing else. There are more than just MPG issues to think of around the gulf area, something we were discussing tonight with the neighborhood get together we have every Sunday. I printed this site out to a few, along with the Smart. Seems like you'll have new lurkers/ members in the near future now.

Is this site sponsored by each hit it receives? If so, I'll push for them to at least look a few times for the webmaster's daily hit totals :D

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Great news! Should also be great for us travelling into the U.S. if warranty service is needed, shouldn't it? If Smarts are to be sold at Benz dealerships then techs will already have diesel experience. Looking forward to more friends joining us! Welcome! I've always loved travelling through Washington/Oregon six times a year and with a past job I would regularly overnight in Seattle. Love the people. I feel as comfortable down there as I do here at home. It brightens up our city here when American tourists visit in the summer. The area where I live in Victoria has many Americans dwelling here. I believe just like Canada the sales of these cars in America will surpass MB's expectations. Wise decision.

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From Detroit News Online: http://www.detnews.com/apps/pbcs.dll/artic.../606260351/1148

Smart car arrives in U.S. in '07

DaimlerChrysler to bring its fuel-efficient minicar stateside in attempt to boost lackluster sales. :speechless:

The Detroit News

DaimlerChrysler AG will begin selling its two-seater Smart car in the United States in 2007, sources familiar with the situation said Sunday.

The automaker is expected to announce the plan Tuesday. Bringing the minicar to the U.S. market could help boost sales for the money-losing Smart brand, which is part of DaimlerChrysler's Mercedes-Benz unit.

The minicar's U.S. debut is being planned as American consumers are increasingly turning to more fuel-efficient cars as gas prices continue to hover around $3 a gallon. It would be sold through a distributor, rather than a dedicated network of Smart dealers.

"It doesn't surprise me that they would bring the Smart car to the U.S. given the interest in small cars," and growing sales of smaller-engined models at Toyota Motor Corp. and Honda Motor Co., said Jim Sanfilippo, senior industry analyst for AMCI in Bloomfield Hills.

But Smart would arrive amid a huge influx of subcompact cars to the United States, including the Nissan Versa and the Toyota Yaris, and there may not be demand to support them all, said Rebecca Lindland, an analyst with Global Insight.

"Our forecast is for less than 500,000 (subcompact) units," Lindland said. "The (Honda) Accord and (Toyota) Camry each sell about that many. Even with all these new models coming in, we still don't expect a huge migration down to subcompact cars."

The Smart brand has never been profitable for DaimlerChrysler. The Smart business has lost more than $4 billion since the 1998 launch of its first model. Last year, Mercedes lost $598 million after taking a $1.3 billion charge to restructure Smart.

Because small cars have thin profit margins, DaimlerChrysler will have to sell about 150,000 Smart cars annually in the United States to reach "critical mass," Sanfilippo said.

But he expects the car could prove popular in the manner of Toyota's youth-oriented Scion brand.

"They have unique styling, they're fuel-efficient. They're good city cars."

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From Detroit News Online: http://www.detnews.com/apps/pbcs.dll/artic.../606260351/1148

Smart car arrives in U.S. in '07

The Smart brand has never been profitable for DaimlerChrysler. The Smart business has lost more than $4 billion since the 1998 launch of its first model. Last year' date=' Mercedes lost $598 million after taking a $1.3 billion charge to restructure Smart.

Because small cars have thin profit margins, DaimlerChrysler will have to sell about 150,000 Smart cars annually in the United States to reach "critical mass," Sanfilippo said.

quote']

I think its rather unfair for all the critics to judge and talk down about the smart's proft margins do date. If Mercedes had kept the car in house and not stood up a stand alone name, the research and developement for the car would have been much less tranparent. They would have absorbed all the new model startup costs into their overall product lines costs. It is impossible to put a new product line out with its own name brand, dealer network, and all affiliated costs without showing a loss for a few years. Since the investor's of modern day want instant satisfaction, how could anything be considered a positive car when put to the market the way the Smart was. Even Scion is deeply connected to Toyota, they share space on nearly every toyota lot I have seen, usually just a smaller building for the salemen to flock around you like flies.

Other costs like the Smart parking structures in Europe didn't help much either in promoting the car's quick turn around profit's. I haven't seen the Candian dealership's, so I am wondering if Daimler had the dealers erect the storage elevators there too? Interesting idea, but definitely a deep pockets venture in itself.

Hopefully, due to the quality of service a Benz dealer offers over the Diaper Chrysler tin box shops, Mercedes will be the service point in the US, NOT Dodge or its related sub groups.

I am not sure if the Canadian smart's or the Zap cars will be welcone at the USA dealers since they are starting off from the very beginning with only the 2nd generation cars, this will make alot of parts and diagnostic issues most likely specific to the newer model cars. I'm sure they can provide support to those who need it, but I highly doubt it will be as easy as one will hope with this in mind.

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Considering that the maximum capacity of the Hambach plant is about 200,000 cars, and 80,000 are made annually NOW, I doubt that they're planning to sell 150 K cars per annum in the USA. It would be great if that was possible though. My estimate would be 25,000 per year in the USA at first.

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The following is from today's Marketplace on NPR ( http://marketplace.publicradio.org/shows/2...M200606265.html ):

If you find yourself in Florence and in need of transportation, your best option is two feet. Trust me. Barring that, there's the pricey Vespa to get you through the crowded streets. Barring even that, try a Smart Car. It's about the size of an oversized golf cart, seats two, plus maybe a couple of bottles of Tuscan wine. But you'll get better than 40 miles to the gallon. I personally can't imagine driving one through L.A. traffic. But DaimlerChrysler plans to start selling them here next year. Despite the fact the cars aren't quite smart enough to turn a profit. Marketplace's Bob Moon reports.

BOB MOON: A few hundred of the Smart cars already have been imported by a company that tweaks the European models to comply with US smog standards. Now Chrysler's Mercedes-Benz division reportedly has decided it's ready to bring the tiny cars to the US market, amid declining sales in Europe.

Some analysts say . . . smart move. There are all kinds of new entries suddenly competing in the subcompact market. But industry analyst Jim Sanfilippo wonders about reports the company has settled on selling the cars through a distributor, rather than a dedicated group of dealers.

JIM SANFILIPPO: "The Smart is visually arresting, gets extraordinarily high mileage, obviously comes from a corporation that builds wonderful cars. It should do very well. But what's really important is the kind of distribution network that is set up, how efficient it is to enable them to, you know, build enough profit to expand the franchise and market successfully and competitively, consistently."

There's already a Smart car Web site aimed at the US market . . . The musical promo plays to the car's hip side. But at autoextremist.com, industry commentator Peter DeLorenzo says even though he likes the car, he's skeptical of Daimler-Chrysler's marketing savvy:

PETER DELORENZO: "They've demonstrated time and time again that they are incapable of marketing hip cars."

Indeed, the Smart Car operation began back in 1998, and it's yet to turn a profit.

In New York, I'm Bob Moon for Marketplace.

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a huge influx of subcompact cars? They call 3 model launches a huge influx? That's a drop in the bucket. The journalists could be more frank with what they're trying to say. Something like, "The smart launch will be doomed right from the start, and I'm calling it! Woo" All in the name of getting the scoop and being sensational. Nope. Sorry. They don't get it and they don't know what to say. Cover your eyes. You could be more selective in what you read for the next while.

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smartcarofamerica.com has the following posted:

According to our sources it’s now official and the waiting is over.

As we have been saying; Daimler will be selling its Smart ForTwo car in the United States in 2007.

The successor to the Smart Fortwo will be on sale in Europe in less than 6 months and DaimlerChrysler will be selling the Smart car in the United States!

The new 2007 Fortwo will be extended by 7 inches and weight will increase slightly. We're told this was done for U.S. requirements and compliance reasons.

The new Smart will be embracing the Brabus appearance.

The Smart's headlights will be larger and more aerodynamic, tail lights will be restructured, improved horse power, enhanced gas mileage, superior safety features, additional color alternatives and added standard and optional equipment will be available.

The Smarts windshield angle will be modified for new protection of pedestrian’s standards.

The Mercedes Smart ForTwo celebrates its 8th anniversary this year. The car has proven to be more than a fad. It now has a cult following.

The pint-sized car looks every bit as avant-garde and distinctive as it did back in 199 when we drove one of the first ever imported into America.

The Smart is unique, and for the many people who have driven it, the Smart Car has proved utterly irresistible.

Since Mercedes Benz launched the Smart, this little car has been changing the public's attitude about a petite and practical motor vehicle, regarding automotive safety, function, and efficiency.

Smart has now been fully integrated into the DaimlerChrysler network.

The Smart division has yet to turn a profit. However, it recently reorganized the entire sector and many new plans have been implemented.

Smart ForTwo is one of the most fuel-efficient, gas-powered cars on the planet.

The Smart Car is one of the most appealing vehicles on the road; you can park where other cars can't squeeze in, and it is economical, both at the pump and to drive.

Every ingredient of the car is unmistakably “intelligent.”

As always, Smart Car of America has stayed true to its quest, researching and finding up-to-the minute material on alternative transportation for our readers.

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It just dawned on me that smarts will be sold through IKEA stores. :biglaugh: Put the fortwo in the kitchen display loaded with groceries, let the kiddies play "change the panels", and they have plenty of warehouse racks for a smart tower set-up. And the demographics are a perfect match, so Mercedes-BenzUSA won't have to come off their own lofty tower. :BlahBlah:

This is from TheCarConnection.com ( http://www.thecarconnection.com/Auto_News/...173.A10582.html )

Smart Coming to U.S.

DaimlerChrysler is expected to announce Tuesday its plans to launch the smart brand in the U.S. in 2007. A new design of the two-seater fortwo will be marketed into urban markets like New York, Washington D.C., Boston, San Francisco, Chicago and Los Angeles.

The company is expected to announce a distribution and marketing scheme that will not leverage any of the company's existing dealer networks. Previously, the company planned to launch smart in dedicated showroom space at Mercedes dealers. Instead, the CEO plans to sell the cars through one megadealer such as United Auto Group or Penske Auto Group, allowing the retailing companies to site the smart dealerships where they think best rather than tethering them to Mercedes shops.

One logical choice for a partner would have been AutoNation, whose CEO, Mike Jackson, was the former head of Mercedes-Benz North America. AutoNation is the biggest Mercedes dealer in the country. But Jackson, say sources, has not been enthusiastic about smart's outlook in the U.S.

Smart has been a perennial money-loser for DaimlerChrysler and was under review last year for termination by then Mercedes-Benz chief Eckard Cordes. But after former Chrysler CEO Dieter Zetsche became chairman of DaimlerChrysler and chose to run Mercedes-Benz after Cordes left the company, smart got a reprieve. The forfour small SUV that was to be manufactured with Mitsubishi and sold as the first smart in the U.S. was canceled, though, and the smart coupe and roadster have been discontinued. The diminutive fortwo, which has been featured recently in two films-The Da Vinci Code and The Pink Panther, has been a success in Canada under DaimlerChrysler-controlled marketing distribution. And Zap, a Santa Rosa, Calif., company, has been selling a handful of Federalized fortwos for about $25,000.

Zetsche believes the redesigned smart can gain some of the cachet in the U.S. that BMW has achieved with the MINI, which created a premium small car segment all its own. The hitch is whether DaimlerChrysler will be able to get enough for the quirky smart to minimize losses. The vehicle; according to well places sources, costs about $17,000 to build. Some retailers believe the natural price for the smart is only about $10,000, but that DCX will try to get at least $12,000 to build volume and minimize losses.

One of the chief attractions of the smart in congested places like New York City is the ability to park the car nose-in to the curb without protruding beyond other cars. But in New York, parking laws would have to be amended to allow it, because current regulations would prevent nose-in parking.-Jim Burt

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Any word on what engine will be used in the US cars; Gas, diesel or Coca-Cola??

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Any word on what engine will be used in the US cars; Gas, diesel or Coca-Cola??

Sprite, Mountain dew, Dasani and wheat grass milkshakes. Depends on the Demographics their targetting.:D

I doubt they'll give us a chance for diesel, everything MB has done with their other 2007 models so far has pointed to the gasser only options :mad:

I was talking to a friend the other day about this, he specifically pointed out that the auto/oil industry is blaming the large #'s of people running SVO, homebrewed Bio Diesel as the reasoning they are stepping away from diesel's with the EPA's help of diesel emission's tightening as their excuse. :banghead: Apparently, there is big concern with not only the emissions issues unregulated fuel's supposedly present (I can somewhat see a point here, but that's what penalties and enforcement is all about). The other reasoning the USA's power's that be are restricting the diesel's so much is the warranty claims that veggie oil consumers are demanding on the manufacturers and dealers after not running clean enough fuel in their cars. The manufacturers don't want the headache of proving alt fuel is causing the breakdowns, so they're simply reducing the # of models optioned with diesel even more.

I personally think its bordering on urban legend/ internet gossip, but figured I'd see what other's here think about it?...

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Smarts will not be available in Nebraska because the Germans don't know where that state is. However, in answer to ARTZ's question about what engine - other writers seem to point to a gas 3-banger made by Mitsubishi. I hope it doesn't require premium.

Cmdr Cody

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Smarts will not be available in Nebraska because the Germans don't know where that state is. However, in answer to ARTZ's question about what engine - other writers seem to point to a gas 3-banger made by Mitsubishi. I hope it doesn't require premium.

Cmdr Cody

German's know where nebraska is, They are constantly trying to get tourist info to Nowhere Nebraska. I'll definitely be looking for an older Smart if Mitsucrapsi has anything to do with the new one. Nothing like turning a perfectly sound vehicle into another Dodge Neon/Mitsubishi dog pile. A definite way to ensure the car falls on its face and goes further in the red :steamed:

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We've been waiting since May 9, 2001 article in WSJ (attached scan)

DaimlerChrysler To Announce US Launch Of Smart Cars Wed

3:02 PM EDT June 27, 2006

DETROIT (AP)--DaimlerChrysler AG (DCX) Chairman Dieter Zetsche on Wednesday will announce plans to sell its micro Smart car in the U.S. next year, a company official told The Associated Press.

Zetsche is scheduled to meet with reporters Wednesday morning to make the announcement at the Detroit Athletic Club, the company source said Tuesday on condition of anonymity because the information hadn't been officially released.

The Wall Street Journal first reported the planned launch Saturday, citing people familiar with the matter that it didn't name.

Smart, a brand that has been popular in Europe, offers the funky-looking two-seat fortwo model, but its other models, a roadster, and the four-seat forfour, are being discontinued in Europe, according to its Web site.

The brand has never turned a profit, and the company said earlier this month that sales of all models fell 21.5% for the year.

Smart already has launched its two-seater model in Canada, where the company said initial sales have been good.

(END) Dow Jones Newswires

06-27-06 1502ET

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They'd be a bargain at under $10K ;)

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Remember - it is gas powered so cheaper - and exhange rate - still cheap - perhaps they are starting them out at a loss to get user acceptance - plus there is always all the extra cost options (oh - you wanted a passenger seat - and a steering wheel). Also the fine print said it was converted from the European price in Euro's - math might not be the author's strong point.

Cheers,

Cameron

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