In 2008, the future looked bright for the Smart brand in the Untied States. Gas prices had climbed to record levels, so then-distributor Penske Automotive had no trouble in selling 25,000 Smart Fortwos in the car’s first official U.S.-market year.

Then the recession hit, followed by lower gas prices, and Smart sales plummeted. Last year, Penske sold less than 6,000 Smarts in the U.S., prompting Daimler to take back the brand.

Now Mercedes-Benz has been appointed as the new distributor for the Smart brand, and it will launch a series of television ads for Smart beginning next week. The TV ad campaign is the first in the United States since the brand was launched in late 2007.

Mercedes will target the ads to large urban markets, where the diminutive Smart makes perfect sense as a commuter car and park-it-anywhere runabout. The ads will be backed up by offers of low interest rate leases and loans, provided through Mercedes-Benz’s captive finance division.

More changes for the brand are in the works. Steve Cannon, Mercedes’ vice president of marketing, aims to create a “distinctive Smart environment” over the next year and a half. Expect that environment to be limited to big cities with large residential populations, since Cannon, in comments to Automotive News, equated targeting Middle America to “pushing a rock up a hill.”

The next generation of Smart is currently under development between Mercedes-Benz and Renault SA, but isn’t due to hit the market until 2014. Until then, Smart (and Mercedes-Benz) must soldier on with the Smart Fortwo as it exists today.

What’s your take on this? Will a targeted TV campaign boost Smart brand awareness enough to reignite sales, or with the new 2012 Scion iQ hitting the market, is a new and improved Smart Fortwo needed for the brand to succeed?

[Automotive News (subscription required)]


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