Smart ForTwo among cheapest cars in America

Tiny two-seat economy car will have a starting price under $12,000.

By Peter Valdes-Dapena, staff writer

NEW YORK ( -- The Smart ForTwo, a wild-looking two-seat economy car produced by DaimlerChrysler, will go on sale in the United States at a starting price just under $12,000.

When the ForTwo goes on sale in the first quarter of next year, it will be the smallest new car you can buy in the U.S. At 105.6 inches, the redesigned ForTwo will be about 40 inches shorter than a Mini Cooper.

2008 Smart ForTwo

It will also be one of the cheapest. Only the Chevrolet Aveo 5 hatchback, with a starting price of $9,995, costs less.

The entry level ForTwo will have a manufacturer's suggested retail price of $11,590, not including taxes and destination charges. It will have a 5-speed manually-shiftable automatic transmission. It will not be equipped with a radio or air conditioning.

The highest-priced ForTwo, the convertible Passion Cabrio, will have a starting price $16,950.

All ForTwo models sold in the U.S. will be powered by a 1.0-liter, three-cylinder engine producing a maximum of 71 horsepower. The car will have a top speed of about 90 miles per hour.

The Smart brand was launched in Europe in 1998 and the ForTwo went on sale in Canada in 2004. For several years, Smart also produced a four-door model and a sporty-looking roadster, but those models were discontinued as the brand failed to turn a profit.

DaimlerChrysler (Charts) had planned to introduce a Brazilian-built small SUV, to be called the ForMore, to the United States beginning in 2006, but those plans were dropped.

Instead, the company is introducing a new ForTwo, redesigned to meet a demanding U.S. market. The new version is slightly more powerful and spacious. The cars will be imported by United Auto Group, a dealer group headed by Roger Penske.

Official EPA-estimated fuel economy figures for the new ForTwo are not yet available, but the current gasoline-powered European version - it is also available with a diesel engine there - gets about 40 miles per gallon, according to DaimlerChrysler.

The redesigned ForTwo has not yet been crash-tested by U.S. auto safety regulators.

Even with a starting price below $12,000, the ForTwo will still face competition from the likes of Toyota (Charts), Honda (Charts), Nissan and Chevrolet, brands that can offer vehicles with more space for people and cargo, more features and fuel economy that comes close to the Smart ForTwo.

The Honda Fit, for example, gets an EPA-rated 38 miles per gallon in highway driving and it has a starting price about $2,000 higher than the ForTwo. Top of page