Mercedes Confirms Smart Brand Is Dead in the U.S.

Electric vehicle strategy is now centered on the EQ brand starting in 2020.

Mercedes-Benz has made it official: the Smart small car brand will no longer be sold in North America after the 2019 model year.

Dealers got the news today that the brand, which has switched to selling electric-only vehicles, will not continue in the U.S. and Canada. In other words, no 2020 Smart ForTwo. Mercedes-Benz will continue to provide service and parts for ForTwo owners, both gasoline and electric-powered.

"After much careful consideration, Smart will discontinue its battery-electric smart EQ ForTwo model in the U.S. and Canadian markets at the conclusion of [model year] 2019. A number of factors, including a declining micro-car market in the U.S. and Canada, combined with high homologation costs for a low-volume model are central to this decision," said spokesman Rob Moran in a statement.

The timing coincides with the introduction of the EQC electric SUV coming to North America in 2020. Mercedes will center its North American electric vehicle strategy on the new EQ brand.

During the New York auto show earlier this month, Britta Seeger, member of the Daimler board of management responsible for Mercedes-Benz Cars marketing and sales, told MotorTrend that a decision on the future of Smart in the U.S. was imminent.

Smart was created in 1998 in a partnership with Swatch but has never been a moneymaker. To try to jumpstart it, Daimler announced in 2017 the tiny lineup would go full electric. But global sales fell 4.6 percent to 128,802 globally and in the U.S. many dealers stopped selling the ForTwo. Sales dwindled to 1,276 in the U.S. last year, a precipitous 58 percent fall.

Now, Daimler is focusing production and sales on the China market. Last month the automaker announced a joint venture with China's Geely to build the next generation of micro cars at a dedicated plant in China for global consumption starting in 2022. Details of the deal are still being worked out. The lineup will also expand into the larger B-segment.

Daimler and Geely have explored alliances since Geely Chairman Li Shufu bought a 9.69 percent stake in Daimler in 2018. Seeger and Shufu are two of the six board members for the joint venture that will make the new Smart cars.