The Smart "pure" model starts out at "under $12,000" according to their site. Also, to test your theory, I went to toyota.com and configured a Corolla. Once I added in an automatic transmission and power windows/door locks (which is a $500 option on the Corolla!), my MSRP was $16,325. I would imagine that the Corolla will still be a more popular car -- but it's certainly not cheaper.