Originally Posted by Wall Street Journal; February 5, 2007

PHOENIX -- When BMW launched the new Mini Cooper in the U.S. five years ago, it was in a class by itself, defying the conventional wisdom that the American road was a land of the giants.

Now, BMW AG is rolling out a new Mini -- although you probably can't tell just from a photo of the exterior. But today, a tiny car with lots of technology and distinctive style doesn't seem so unconventional. In fact, it looks like a pretty mainstream idea.

The Mini's quirky blend of attributes -- the exterior's homage to the old "Mr. Bean" Mini, the high-tech go-kart performance and the planet-friendly fuel economy -- hasn't changed. But the environment around it has.

Small-car sales, by one count, hit 600,000 vehicles in 2006, up 38% from the year before. While there's still nothing quite like the Mini, shoppers fancying a car compact enough to scoot into tight city parking spaces while sipping instead of chugging fuel are getting spoiled for choices.

This week, for example, Toyota's Scion brand will unveil a second generation of its Scion xB -- the toaster-profiled mini-wagon that has become a style icon of sorts in its own right. Next year, DaimlerChrysler AG's Smart micro-car unit will bring to the U.S. its teeny ForTwo -- perhaps you remember it from the movie version of "The DaVinci Code." A few years ago, selling a car the size of a ForTwo in the U.S. seemed like madness -- which is why DaimlerChrysler didn't bother. The Mini's success in the U.S. evidently prompted a rethink in Stuttgart.

BMW's ambitions for Mini have grown as well. Jim McDowell, head of Mini USA, says that over the next five years, the Mini family of cars could expand to include four or five body styles -- with a new model launching every year over that period. Next year, for instance, Mini is expected to introduce the production version of a wagon, often called the Traveller, it's been previewing at auto shows.

Mini has expanded production capacity at its British plant by 20% to 240,000 cars a year. Mr. McDowell, while betraying no concrete information, observes that back in the days of the original Mini, not all Minis were made in Britain. Mini isn't limited to one factory by any sort of tradition or brand concern. Mr. McDowell is planning to expand Mini's U.S. dealer network by two to three stores per year each year for the next four years. Mini even has a store in Omaha, Neb. Who'd a thunk that five years ago?

Mini's rise highlights a shift in the conversation that Americans are having about cars -- some Americans at least. After more than a decade of rewarding car makers for delivering ever more horsepower and weight, Americans are fretting over the recent United Nations report warning that human beings are indeed altering the planet's climate in potentially catastrophic ways. They are having millions of anxious conversations about the war in Iraq, the nation's "addiction to oil," or Exxon-Mobil's profits.

Advocates of less petroleum consumption take heart that sales of midsized truck-frame sport utility vehicles such as the Ford Explorer, which displaced more efficient sedans throughout the 1990s, took a pounding during 2006, as gas prices gyrated.

True, since gas prices have settled back closer to $2 a gallon in many parts of the country, there are signs that demand and pricing for traditional SUV's -- such as the Chevy Tahoe or Ford Expedition -- has stabilized. The Power Information Network, which harvests pricing data from thousands of dealerships, says that the average price paid for a large SUV in January was $40,374, up from $38,935 in August. But this doesn't mean old-fashioned SUVs are going to bounce back to the levels of three or four years ago.

By 2010, it's likely that the Ford Explorer, once the best-selling SUV on the planet, will be transformed into a car-like crossover. Even still, this successor vehicle will likely dwarf a Mini. General Motors has decided not to invest in a successor to its rival line of truck-frame mid-sized SUVs, which includes the Chevy TrailBlazer. Instead, GM is pushing its new lineup of large crossover wagons, such as the Buick Enclave, Saturn Outlook and GMC Acadia.

When it comes to basic values -- how to balance size versus fuel efficiency versus safety -- America is not one nation, it is many. And it will stay that way for a while.

Cars like the Mini represent a bet that for a meaningful, probably elite, class of consumers, small is beautiful. It's also a cultural "hi" sign by which those who share a certain set of values can recognize each other. You might call these values "European," since in Europe, where gas prices are about triple U.S. levels, mass market cars tend to put fuel and space efficiency first.

But for Americans, Mini's marketing still stresses handling, performance and fun. It's not happenstance that Mini decided to hold part of its press preview at a race track.

Most of the money spent to redesign the second generation Mini was invested under the skin to improve pedestrian crash safety, and, more importantly, upgrade the car's ride. The biggest cosmetic change is the look of the dashboard -- where the distinctive center stack under the unique big round speedometer dial is narrower, the better to provide room for passengers' knees.

The base engine gets a modest horsepower boost, to 118 horsepower from 115. The Cooper S gets a similarly demur bump to 172 horsepower from 168 horsepower in the outgoing car. Prices are up a bit too. The base Mini Cooper will start at $18,700, up $700, when it goes on sale later this month. The turbocharged Cooper S will start at $21,850, up $400.

On the well-lit desert highways around Phoenix, a base Cooper with the new six-speed manual transmission is nimble, but not as harsh on the bum. It's still "go-kart like," compared to a Toyota Camry or an SUV, but BMW engineers have dialed in a bit less kart, and a bit more comfort. The new Mini is designed to get 32 miles per gallon city, 40 miles per gallon highway, while the S model is designed to deliver 29 city, 36 highway.

Mini is stressing the safety improvements of its next generation car. The new Mini will come with six airbags, stability control, traction control and a feature called "brake assistant" that automatically builds up brake pressure when the car senses a panic stop in the making.

As impressive as the technology of the Mini is, the fact remains that no driver of such a car will want to hit a Chevy Tahoe. It will be a good deal better for a Mini motorist to use the car's nimble handling and lightning reflexes to avoid tangling with the big brutes of America's roads.