Could smaller cars bring down vehicle prices?

President Donald Trump thinks he has found a solution to the skyrocketing price tags for vehicles: building smaller cars. These vehicles are extremely popular in Asia, where they are known as micro cars or kei cars. But many auto industry analysts say translating the success of Asia’s micro car market to the United States is an unrealistic goal.

What did the commentators say?

Trump has mused on social media that the U.S. should start producing these cars, which are “small, fuel-efficient vehicles that are roughly 30% shorter” than a Toyota Camry and the same width as a Smart car, said The Wall Street Journal. Trump’s affinity for the vehicles seemed to arise “after a recent trip to Japan to talk about trade and economic investments.”

These cars are often much cheaper than standard vehicles, and “can cost as little as $8,000 or $10,000,” said CNN, while the “average price of a new car in the United States is currently around $50,000.” Manufacturing cars that are that cheap “would be an answer to affordability issues for many car buyers — and a major political headache for Trump.” But these vehicles “don’t make sense en masse here, from existing regulations to the Trump administration’s own contradictory policies,” said Car and Driver.

The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

Part of the reason is straightforward: these cars “aren’t adapted to U.S. regulations and sold here because the demand simply doesn’t exist,” said Car and Driver. This is partially because Americans “barely buy cars anymore,” and favor larger vehicles like trucks. The incentive for automakers to sell smaller cars has also “gone out the window” with “regulations now set to be relaxed” by the Trump administration on gas-guzzling trucks.

These vehicles also “would have to be redesigned and retested to meet U.S. standards” for safety, said Axios. Current laws say imported micro cars must be at least 25 years old as part of U.S. safety regulations. These standards are different in Asia, and approving them for the U.S. would involve “stronger, heavier chassis and larger crumple zones to withstand crashes.” Manufacturers would also need to install “U.S.-spec safety equipment and lighting systems, among other changes.” This would involve high price tags for automakers that would “defeat the cost and efficiency advantages of micro cars.”

What next?

While these micro cars are exceedingly rare in the U.S., there is another type of these vehicles, kei trucks, which are the “largest class of vehicles being individually imported to the U.S., with around 7,500 arriving last year,” said Fast Company. They are the “size of golf carts” and “can’t go 60 miles an hour,” said Jason Marks, the CEO of electric truck startup Telo, to Fast Company, but they are “still this desirable.”

But while the truck variants of these vehicles are selling well, don’t expect to see micro cars dominating the streets anytime soon. They “would be nearly impossible to sell here” on a mass scale, said Michigan Advance. Despite these concerns, Trump is seemingly pressing ahead with his micro car plan. The president has “cleared them for production and is demanding that automakers manufacture them domestically,” writing on social media that the U.S. should “START BUILDING THEM NOW!”