Ten or so years ago when the Smart hit Europe, the whole idea was "the new Mini." Cheap to buy, cheap to operate, 2x the parking, etc.
Today in Canada, the Smart is bought primarily as an image car. The price, to me, is WAY too high. I love the concept and the execution ain't bad, but the price difference between the Smart and cars like the Yaris/etc. is much too large to justify the very small fuel economy advantage. A Yaris HB can carry more people, more stuff, gets almost as good fuel economy, and does not come with the baggage of a terrible reliability record.
The Toyota iQ? Now we're talkin'. Make the thing $12,995 ready to drive off, and wow, what a Smart car killer. Heck, price it way too high, say the same as the Smart, and I bet it would still outsell the Smart thanks to the Toyota v Mercedes/Smart build comparision...