Here's a niche that may grow: Premium small cars. If you could have all the luxury and safety you wanted, but in a car you could park really easily, would you go for it? With that question in mind, Volvo is getting ready to roll out much-improved replacements for their smallest cars; the slow selling, half-Mitsubishi, half Volvo S40 and V40. The replacement sedan will use the S40 name; the wagon will become the V50.

While on the small side, these cars promise a moderate degree of luxury--with very Volvo-esque interiors--and a high degree of safety. The S40, which looks like a mini-S60 sedan from the outside, is shown here after an offset crash test.

After being hit at 35 mph, the front end of the engine has crumpled, absorbing the energy of the impact, while leaving the passenger cage protected. Additional steel beams in the doors (or maybe they're 2X4s?) protect occupants in a side impact. Add to that every type of air bag imaginable, and it's a small car worth considering, even for the safety obsessed. We'll be interested to see how it drives later this year.