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smart began as an idea between two unlikely partners. In the early 1990s, Swatch CEO Nicolas Hayek envisioned a compact, efficient city car that would rethink urban transportation. He approached Volkswagen, then Mercedes-Benz, and in 1994 the Micro Compact Car AG joint venture was formed. The brand name smart stands for Swatch Mercedes ART.
The first generation smart fortwo launched in 1998 with a distinctive design that divided opinion. Its rear-mounted engine, 2.5-meter length, and removable body panels made it unlike anything else on the road. Early reviews praised its maneuverability and parking ease while noting its unconventional automatic transmission and modest performance. Despite mixed critical reception, the fortwo found a loyal following in dense European cities.
Mercedes-Benz gradually increased its stake, taking full ownership by 2005. The second-generation fortwo arrived in 2007 with a more refined interior and a conventional automatic gearbox, broadening its appeal. A four-door forfour model was introduced in 2004 but was discontinued after low sales, returning in a second iteration in 2015.
Smart expanded its lineup with the roadster and the larger forfour, but the fortwo remained the brand's identity-defining model. Production of the combustion-engined fortwo ended in 2019 as smart shifted to a fully electric lineup under a new joint venture between Mercedes-Benz and Geely. The electric fortwo and the larger smart #1 SUV now form the core of a reinvigorated brand aimed at a younger, tech-oriented audience.
The smart fortwo's 2.5-meter length set a new standard for production car compactness. Its rear-mounted engine and front-wheel-drive layout optimized interior space within a minimal footprint, achieving a turning circle that made parallel parking effortless in dense urban environments.
The tridion safety cell was a breakthrough in small car design. The fortwo achieved four-star Euro NCAP ratings despite its tiny dimensions, proving that ultra-compact vehicles could be genuinely safe through intelligent structural engineering rather than sheer mass.
Smart pioneered the use of interchangeable, removable body panels made from thermoplastic. Owners could change their car's color and style without repainting, reducing waste and enabling personalization at a scale no other manufacturer had attempted.
The brand's transition to an all-electric lineup under the Geely joint venture positions it as a test case for urban EV strategy. The smart #1 SUV represents a departure from the original microcar concept, adapting the brand identity to the crossover-dominated market while retaining the city-focused mission.
How the platform works for buyers and dealers