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Agreed, the absolute most you'd want is about a one-litre unit, and depending on the weight of the car, something smaller would be enough. I reckon any of the engines from the Smart range, whether it's one of the 1.0 naturally aspirated ones or one of the older 6-700cc versions, would be just right for such a car. Actually, Smart's 3-cyl turbodiesel would be excellent in such an application too.
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