IT is the number one car of choice for quirky professionals and a favourite among trendy couples, but the future at Smart may not be so sharp.

For while the unusual-looking city cars have always painted a smile on the face of everyone who sees them, the corporate bean counters at parent group Daimler Chrysler are far from happy.

Smart may have the kind of brand kudos that beleagured MG Rover would have done anything to achieve, but the truth is that the cars have never made money.

In fact, the current level of loss-making (about £400m a year) makes the defunct British company look positively healthy.

The difference is that Smart has been able to rely on its cash rich parent for help - until now.

With losses continuing and signs of a turnaround as far away as ever, shareholders are demanding action.

Rumblings of discontent started last November when Daimler Chrysler admitted a "deteriorating sales performance" had dragged overall profits down by 62 per cent.

Attempts to broaden the brand appeal with a more pragmatic hatchback (the ForFour) haven't been as successful as the group had hoped.

The ForFour is based on a Mitsubishi design and doesn't enjoy the same prestige as its smaller siblings.

Departing chief financial officer Manfred Gentz let the cat out of the bag when he said: "The question is what are we going to do with Smart. It is still under investigation."

Now we know what that investigation turned up: continuing losses for at least two more years and the need for tough decisions.

The range is due to be dramatic-ally scaled back. Smart bosses are killing off the roadster and coupe models.

A small off-roader will never make it to market.

This will leave just the ForTwo and the ForFour to lead the line. Scrapping the sports cars will cost Daimler Chrysler a small fortune.

The company gave suppliers firm orders for large volumes in order to reduce up-front costs. Now it will have to compensate them for killing the cars prematurely.

This is expected to cost about one billion euros.

Analysts think this is one of the reasons why the ForFour survived the purge: the cost of stopping production is even more than keeping the factory running and selling at a loss.

As one pundit said: "DaimlerChrysler will probably just let the ForFour wither away quietly."

This will leave the brand with just one model to offer buyers - not enough to sustain a standalone marque in the longer term.

As Daimler executives unveiled their fightback plan, analysts asked if they would have been better just pulling the plug on Smart altogether. As someone once said of the Mini: The trouble with small cars is that they make small profits.

Or, in the case of Smart, massive losses.