Interesting article in today's Wall Street Journal (click here to read) about the declining interest among U.S. consumers for small cars. Of course, these days there's a declining interest in just about anything that costs money, but stay with me on this. The basic premise of the article is that in normal times, when given a choice between a small car and a large car, most Americans will opt for the large car.
The reasons are partly cultural (Americans love to stuff every square inch of their vehicles with both passengers and paraphernalia, as any parent of a school-age kid could tell you), partly geographic (those micro-sub-compacts may work just fine in island nations like the U.K., but those cross-country trips to Grandma's in the U.S. would wreak havoc on most spinal columns in subjected to driving with your knees in your chin for eight-hour stretches), and partly sociological (can't you be just as environmentally-conscious driving a Highlander Hybrid as a Prius?).
On the other hand, check out this IW news article about what a no-frills auto really looks like. If you want a brand-new car for only $2,000, and don't mind giving up things like automatic transmission, air conditioning and power windows, then the Tata Nano might just be what you're looking for.