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Readers of a certain age will recall a time when America's roadways were clogged with Gremlins, Rabbits, and other fuel-efficient minicars. That historical moment was caused by spiking fuel prices in the 1970s (remember when Jimmy Carter told everyone to put on a snappy cardigan?), which rear-ended a recession in the early 1980s. If you've been paying attention, you might've noticed that today's financial and automotive landscapes are looking awfully familiar....
And so, just as they did 30 years ago, every automaker worth its salt is now looking to cash in on the American compact and subcompact markets. BMW has its MINI (not to mention its rumored, tinier Isetta), Audi has its A3, and even Aston Martin is looking to tart up a Toyota iQ. The latest manufacturer to enter the B- and C-segment ring: Daimler, which will likely bring a handful of compact European Mercedes-Benz models to America by 2012. These models will be more luxurious than Daimler's Smart models, which fall into the smaller microcar segment (and which have suffered from, shall we say, less-than-stellar sales).
Now, on the one hand, adding a few gas-sipping Mercedes compacts to its U.S. lineup could be a good move for Daimler. New emissions and efficiency regulations will be implemented soon, and some fuel-efficient vehicles would help Daimler's fleet meet the EPA's stringent standards. Also, the new models could address the shifting needs of Mercedes buyers, since, according to Daimler's CEO Dieter Zetsche, the definition of "luxury" is slowly changing: "It will be fewer CO2 emissions and more modesty in appearance."
On the other hand, we're pretty sure that this "changing standard of luxury" argument was thrown around in the 70s and 80s to justify vehicles like the Pacer. Furthermore, while Zetsche's predictions seems reasonable now, we're not sure they'll remain accurate as world emerges from recession, and we forget about fuel costs, and the green movement inevitably fades (as all trends do, and just as the green movement of the 1970s did). It doesn't take a rocket scientist to figure out that Americans change their habits when necessary, but when the necessity passes.... Well, as Rebecca Lindland, senior auto analyst at IHS Global Insight points out, "in the U.S., luxury is still very much equated with size". It's going to take more than a fuel crunch or two to change that.