The company developed its tiny two-seat Fortwo for use in congested city centers where finding a parking space is cause for celebration. At 106.1 inches long - less than half the size of a standard U.S. parking space, about 5 feet shorter than the Chevrolet Aveo or Toyota Yaris subcompact sedans - the Fortwo is remarkably easy to park.

The Smart's problems begin in those unfortunate moments between parking spaces, when you actually have to drive it.

The funky little hatchback's appeal wanes quickly once the car starts moving. Multiple mechanical shortcomings, quality faults, and a requirement for expensive premium gasoline make the Smart Fortwo a major disappointment. Its biggest advantage - the best fuel economy in any car that doesn't have hybrid after its name - is disappointing, considering its tiny size.

The Fortwo is a phenomenon as much as it is a car, though. Its quirky two-tone looks and tiny size exert a magnetic pull on people who see it as a fashion accessory and a lifestyle statement as much as a means of transportation. They will buy it, and they will love it, because for them what it is like to drive is secondary; the Fortwo's mere existence is its own justification.

But if the driving experience is high on your list - anywhere on your list, really - you can do better than the 2008 Fortwo. Much better.

Smart offers just one drivetrain combination in the United States: a 70-horsepower, 1.0-liter, three-cylinder engine with an automated manual transmission. An automated transmission is mechanically similar to a manual transmission, but it has no clutch pedal and operates like an automatic. Electronic controls shift gears.

Prices for the 2008 Smart Fortwo start at $11,590 for a base model, called the Fortwo Pure. The uplevel Passion coupe starts at $13,590, while the Passion convertible begins at $16,590.

I tested a Fortwo Passion coupe that stickered at $16,400 and a Fortwo Passion Convertible that cost $18,900. All prices exclude destination charges.

The Fortwo is so small that it has no direct competitors, but if you assume its buyers want a small, inexpensive and fuel-efficient car, they might compare it with the $10,325 Chevrolet Aveo, $13,950 Honda Fit, $12,880 Nissan Versa, $15,650 Scion xB or even the $18,050 Mini Cooper. Those all have more room, more power, better rides and higher quality than the Fortwo.

The Fortwo's interior, however, is a marvel of space efficiency. There's plenty of headroom, and two passengers will be more than comfortable. A shelf behind the two bucket seats provides enough room for three or four grocery bags.

The doors open wide, and the high driving position makes the Fortwo exceptionally easy to get in and out of. Smart's looking for cool young buyers, but the Fortwo's ergonomics seem exceptionally well-suited to elderly people and those with limited mobility.

The coupe I tested had a clear plastic panel for its roof that gave the interior a spacious feel.

Most of the Fortwo's body panels are also plastic, and they do not fit together well.

The front panel comes off for access to the car's fluids, but you have to bend the panel slightly out of shape to fit it back into place. The panels around the rear window in the coupe also fit poorly.

In addition, the latch on the rear window broke on the coupe I tested, making it impossible to close the window.

Another mechanical shortcoming was poor shift quality from the automated manual five-speed transmission. You can help that with steering wheel-mounted paddle shifters and by easing off on the gas before shifts, but performance and comfort never match what you could do yourself with a conventional manual transmission.

Smart replaced the defective coupe with a Fortwo Convertible that shifted somewhat more smoothly.

Engine vibration was a constant and annoying companion in both the convertible and coupe, and the Fortwo's idle is rough.

Power from the 1.0-liter engine is acceptable, but acceleration is weak enough that other drivers frequently waved thankfully at me, mistaking the car's slowness for courtesy as they merged into the large gaps that opened up as the traffic in front of me accelerated more quickly than I could.

The Fortwo was not designed for highway driving, but it is all right up to about 60 m.p.h., despite its bumpy ride.

The Fortwo has the best fuel economy of any gasoline-powered car that's not a hybrid, but its EPA ratings of 33 m.p.g. in the city and 41 m.p.g. on the highway are worse than its tiny size led most observers to expect.

Smart Fortwo

2008 Passion coupe

Base price: $13,590, excluding destination charges.

As tested: $16,400.

Standard equipment: Antilock brakes; electronic brake distribution; electronic stability control; hill-start assist; seat-mounted side air bags; leather-wrapped steering wheel; flat-folding passenger seat; air-conditioning with pollen filter.

Options: Metallic paint; silver-painted exterior trim; alarm; power steering; heated seats; fog lights; rain and light sensor; auto-off headlights with exit delay.