Toyota's ultra-compact 'iQ' billed as 'world's smallest car'

Toyota unveiled its newest vehicle model at the Geneva Auto Show, where it drew unprecedented attention from a packed crowd. Billed as the "world's smallest car," the new compact "iQ" was developed to appeal to envrionmentally-aware urban customers, said a Toyota spokesperson.

"We view this car as a major milestone in Toyota's vehicle development," says Andrea Formica, senior vice-president of Toyota Europe.

The iQ can seat three adults and one child, and Toyota hopes its small size will make it attractive to urban drivers. The iQ will also have a CO₂ emissions target of 99 grams per kilometer, which will play a key role in cutting Toyota's fleet average emissions.

The iQ "will have a big impact on the market yet a small impact on the environment ... (and) will be on the roads of Paris, Rome, Berlin and Madrid by the end of the year," Formica adds.

In keeping with the dominant theme at this year's show, Toyota stressed its work in fuel hybrid technologies, energy efficiency and other environmental measures.

The 1/X model, which also went on display at the show, is an example of "plug-in" electricity technology and can cover 100 kilometers (62 miles) on just over two liters of fuel, according to Toyota.

Formica said the company still expected overall company sales to grow by 5.0 percent in 2008 despite "tough industry conditions."

Toyota's U.S. subsidiary reported on Monday a 6.6 percent drop in February sales, with even popular hybrid vehicles down 7.0 percent from a year earlier.

Toyota overtook Ford Motor Company last year for the number two spot in the U.S. market but slipped back to third place in February as the Detroit group reported sales of 196,681 vehicles.