The smart car launched in October 1998 is a 2-seater, 2.5m long by 1.5m wide - small enough that two or even three cars can squeeze into a standard parking space. The incorporation of the hybrid SwatchMobil system had proved problematic, so the car debuted with a conventional engine. It was also not as inexpensive as originally conceived, priced on a par with small 4-seaters.

Initial reception was lukewarm, and sales were well down on prediction (20,000 were sold in 1998 in contrast to the 200,000 predicted by Hayek) but it was a great success in traffic-strangled cities like Paris and Rome, and sales reached 80,000 the following year. The project, constantly at risk, has been expensive, with breakeven forecast for 2004. Nonetheless, it has achieved iconic status, with an exhibit at MoMA (Museum of Modern Art).