Earlier quoted context omitted.
Have you even seen a Smart car or a Toyota Aigo which has all the required safety parts? So tell us exactly which safety parts are so huge again ?
At the same time Toyota Aygo is no longer produced. There is now a Toyota Aygo X - a crossover/mini-suv. From what I have read companies stopped producing most of those smallest cars, because to make good margins within what is required by law in terms of safety and CO2 emissions it does not make much sense to produce small cheap cars anymore.
The A-Segment is well alive and thriving: https://en.wikipedia.org/wiki/A-segment
What I see instead is very small electric vehicles entering the market from new manufacturers --- the market entry hurdle was not the vehicle safety, it was mastering the EURO-6,7,8 and California environmental norms with such a small engine.
I'd love to get one of those, or their van equivalents, rather, alas they're rarely exported outside Japan https://en.wikipedia.org/wiki/Kei_car