Penske gives up on failed Smart Car venture

Daimler AG's Mercedes-Benz luxury carmaker will take over U.S. sales and distribution of its slow-selling Smart cars from Penske Automotive Group. The two companies said they were negotiating a shift in the distribution rights, management, sales and marketing activities of Smart USA from Roger Penske's conglomerate to Mercedes by June 30.

Penske also canceled the development of a five-door small car for Smart that was being provided by Nissan Motor Co.

In a joint statement, Penske and Mercedes said the shift reflected a reorganization at Smart's German headquarters.

But the Smart car has performed poorly in the United States. Smart sales fell 59.4 percent last year to 5,927 cars, in a market that expanded 11.1 percent.