Smart Car Blog

THis smart looks like its t-minus 10 seconds from being dropped on it's head. Chances are it will make it to it's new owner safely thought!

The smart fortwos seem to keep on coming which is great news.

Here is the latest happy smartie!

Looks like this dog is very attentive to the smart fortwo.

Dying to know what cool accessories Smart USA... well wait no longer!

Smart Car recently teamed up with an agency out of New York to put up these low cost videos that ehy hope to be viral... you tell us!

Kuni Automotive Group sent out a press release dated September 15, 2007 claiming to be the only Smart Dealership in the entire state of Oregon. Also in the article, Kuni Automotive Group claims they will receive 650 of the allotted 16,000 Smart Fortwo's to be produced in 2008. I can't say enough how excited I am that Smart Dealerships are comgin out of the wood-work.

Visit Smart Enthusiast to get all the latest Smart Fortwo News.

As part of the promotions leading up to the US sales launch of the Smart ForTwo next January, the US distributor has converted a Venice Beach CA building into a Smart House. The interior of the Smart house is designed to evoke the lifestyles of the the primary purchasers of the Smart: young urban hipsters, whatever the hell that means. The main goal of the house is of course to sell cars and so visitors will be able to check out four of them on the inside with more outside available for test drives.

It's finally here, Smart USA Newsletter vol. 10.

Find out everything you need to know about confirming your Smart Fortwo registration at mysmartfortwo.com!

Step 1: Login in with the appropriate username and password provided to you in an email from Smart USA.



Step 2: Enter your zipcode to verify your initial $99 reservation.


Step 3: Confirm your personal information.


Step 4: Choose your desired model.


Step 5: Customize your car and select your colors.


Step 6: Chose the option to make your smart fortwo unique.


Step 7: Review your customizations.


Now, just hold your breath and it will arrive at your local dealership ;)

While we are at... here is volume 4 of the Smart USA Newsletters.

Did you only hop on the Smart train in the last few months? Well incase you missed all the newsletters via Smart USA, we got em all!

Want to take a run down memory lane with the smart usa newletter volume 3. Check out the strides and leaps smart USA has already achieved in more then just bring thier car to the US but also in producint good press material.



See the entire thing after the jump!

As the world drives toward a cleaner environment, individual drivers, with the help of governments, are going to have to change their purchasing habits.

Some people will change their habits simply because they want to do what is right. Others, who are less altruistic, will require incentives to prod them to make decisions that take the general good into account. Offering incentives, as opposed to legislating outright bans, has the advantage of permitting individuals to make the final decision.

The federal Conservatives understood this approach when they offered in their spring budget to grant rebates of up to $2,000 to drivers who purchase superefficient vehicles.

Now, the provincial Liberals are thinking of offering something similar. Environment Minister Laurel Broten told a news conference last week the government is toying with the idea of creating what might be called a "green licence" plate. "This is another way of us helping Ontarians go green," she said.

The government could, for example, provide green-hued licence plates to drivers who use environmentally friendly, low-emission cars and trucks such as the hybrids which use electric motors as well as internal combustion engines.

Another vehicle that might apply is the Smart car, which, because of its small size, uses a minimal amount of fuel.

There are many perks that the owners of such vehicles could be offered. These might include free parking in municipally owned parking spaces and free access to commuter lanes usually reserved for vehicles with multiple occupants. The price of the green licence plates could be set below the current registration fees. The drivers might be required to pay only a minimal fee to cover the cost of issuing the licences. To their credit, the Liberals are taking their time with this subject and don't intend to implement a policy unless they are re-elected in the provincial election. The government plans to consult the vehicle manufacturers as well as environmental groups. The problem, of course, is that there is no perfect measurement of an efficient car.

A rating system may have to be somewhat subjective. A Smart car transporting just one person -- the driver -- for example, may be less efficient on a per-occupant basis than a larger car transporting the driver and several passengers.

Let's accept that, ultimately, the government might have to make some arbitrary decisions that will not please everyone. The goal in this case is not to produce a perfect policy but a reasonable policy. The pursuit of a greener world will make such a policy more than justified.

According to smart USA"s latest newsletter, they will be launching a "smart fan site" of their own in the coming month! That would be awesome but it leaves me with a few questions... who the hell is going to run that thing. has any automotive-maker ever attempted this before? Does smart USA think they have any idea what it takes to run a community site and the type of backlash that they may be opening themselves up to? Best of luck Smart USA!



Follow the link to read what smart USA is saying!!!

From the smart USA newsletter:

"For those of you who recently made a $99 reservation on a 2008 smart fortwo – congratulations! You have become part of the exciting launch of the smart brand in the USA. But what’s next? Over the next few weeks, smart USA will begin posting important information on our website (and on our e-newsletters) about key aspects regarding the launch.

The next step in the reservation process:
The USA models of the smart fortwo will begin production within the next few months. As such, smart USA will begin contacting reservation holders about taking reservation preferences to the next step. Over the next few months, batches of reservation holders will be contacted to confirm their vehicle preferences, choose any factory options, and send their smart fortwo configuration to the factory.

Technical specifications:
As noted above, the smart fortwo will enter production within the next few months. At that time, full technical specifications will be confirmed and posted on our website. This will also include information on all factory-installed options and dealer-installed accessories.

The smart USA enthusiasts’ site:
Next month, smart USA will launch an official “fan site” for the smart owners. This site will allow enthusiasts from across the country to interact and discuss their smart fortwo’s. smart USA will also allow enthusiasts to help name our site through a special poll. So please keep an eye on your inbox over the next few weeks to participate in the naming of our owners’ site."

See what Roger Penske has had to say about the future and direction of advertising and marketing for his newest baby boy brand, Smart!

Reading the call, I was interested in what Roger Penske had to say about the smart distribution.

Here is an excerpt:

The other thing would be advertising. We are not sure today the traditional TV, radio, etc., newspaper advertising is the way you want to go long-term because if you use smart as an indicator, we haven't run an ad yet, we haven't run a radio commercial, it's all been internet based, internet connection. So I think we are going to get the benefit as the dealers move more of their advertising into the internet those leads they are going to get then they are going to pass through the dealer in a particular area where you have the zipcodes and I think that's going to make a huge difference for us as we have scale in many of these markets. Also when you look at the smart customer, we've asked them on the road show, how do you want to be contacted and 62% said, we want you to contact us by e-mail. So this e-mail capture, the internet, CRM systems, I think that's just going to drive our SG&A down as we get more efficient. Because I can send an e-mail blast out and blast out on a service special and get overnight response that hasn't cost me a nickel so it's very efficient. So, I think that will be a big driver for us.

Smart Cars to hit U.S. streets next year

SALT LAKE CITY (ABC 4 News) - Say bye to big trucks and hello to the Smart Car. The European made vehicle will be the smallest car in the country. They go on sale next year, but already hundreds of Utahns have put in their order.

In a news conference yesterday Dave Schrembi reported that Smart USA has hit 20,000 in reservations... but wasn't that the news 3 weeks ago? Dave, how about you make a call over to your reservation group at Internet Brands and find out your real numbers!


Penske Automotive Group (PAG) Exceeds Goal with Smart Reservations
In a press conference yesterday in Detroit, Smart USA President Dave Schembri said they have received more than 20,000 reservations for the Smart Vehicle that will be available at some 45 - 60 dealers beginning in January 2008. (Source: Wall Street Journal, January 11, 2007. Page D4).

But for the first time, smart usa began to talk numbers with the public and discuss the possible success of the smart car in the US and we commend them for bringing this to the forefront!

But either way, here is the rest of the story broken down by seekingalpha.com:

Keep in mind that the reservations only require a $99 deposit. So people can still back out. But it is a heck of a lead.

If all reservations are filled, it works out to 333 to 444 Smart vehicles per dealership.

However, Penske Automotive is the distributor of Smart. So this does not mean Penske Automotive is going to own all of the stores. They own some of the stores. But a lot of the stores are owned by other dealers (including some of the large public dealers).

So you likely won't see a huge boost in gross profit dollars or percentages (and actually it might cause a slight drag in 2008).

As a reminder, Penske Automotive made about $2,993 in gross profits per new vehicle in 2006 and $2,427 per used. Also if you take the company's fleet and wholesale gross profits divided by the total retail units (because I hope wholesale is looked at as driving used vehicle sales and fleet possibly helps drive some new vehicle retail sales) you come up with $14 gross profit per retail unit.

My guess is that Smart counts as a fleet sale and so you see the $14 figure go up a bit in 2008. But you will also see total gross profits as a percentage of revenues decline a bit (all else equal).

But dollars per unit and percentages are less important than return on investment [ROI]. So if Penske is essentially collecting a "toll" on every one of the units being sold at the stores, it can make for a pretty attractive ROI.

Now I don't know what Penske Automotive will make on the sale of each Smart vehicle (through the distribution agreement). We can all try to guess ($200/$300 per unit?) But we just don't know.

And this can create problems when trying to model the impact Smart will have on the company's financial results in 2008. So let me give you some numbers to work with.

We know that management said they expect to earn between $1.40 to $1.50 per diluted share this year (2007). This guidance assumed 94.6 million shares outstanding throughout the year (a couple million more than they had in the first quarter). And this works out to $135 million to $145 million in after tax earnings in 2007.

Included in the earnings guidance, management also said they will have $0.02 to $0.04 cents a share in costs associated with the launch of the new Smart vehicles. Or, $2.0 million to almost $4.0 million in after tax expenses. They've got around a 37% tax rate. So if I put these numbers on a pre-tax basis, we're talking about $3.0 million to $6.0 million bucks in expenses associated with Smart.

I suspect the conservative nature of the Penske organization only includes direct costs with Smart. For example, Sr. Vice President Tony Pordon has been playing a key role with Smart. But he also continues to exercise his duties as head of investor relations. So do they divide his salary and include it in the Smart costs? I suspect not.

Instead the $3.0 to $6.0 million in expenses being called out by the company on the conference calls are probably set up costs (systems, administration, etc.). And also some of the "road show" marketing that the company has been doing with signing up dealers and even sending the vehicle around the country to increase awareness.

They may have more expenses when they actually go live (distributing to the 45 - 60 dealers), they may have less. We don't know.

But based on the expenses we know right now (the $3.0 to $6.0 million), what it tells me is that at 20,000 Smart unit sales, Penske needs to make $150 to $300 per vehicle to break even. And at 40,000 units (so 2x the reservations) the company needs to make $75 to $150 per Smart to break even.