"Is there any specific reason why Detroit refused to bow to the growing small car demand that must have been obvious as a trend for a decade ? I mean even if they still wanted to make SUVs, coulnd't they have tooled up a couple of lines for something more european? Why did GM so completely destroy the EV-1 ? Even if it wasn't a success in itself, why destroy all of the work ? What were they afraid of ?"

Not sure if you are looking for a serious answer to these questions, but if so:

They do SELL small cars, mostly imports from Korea. They're perfectly good cars with Chevy, Ford, etc. labels on them, but the profit margin on an economy car--even if imported--is much, much smaller than on a big pickup truck. I know someone who paid $50,000 for a huge pickup a couple of years ago, of which the profit for GM was probably about $30,000. Today you can walk into a dealer and get $12,000 off list price on a truck or SUV without even asking.

And the EV-1 was a great car, except for two problems:

• It was a hand-made fiberglass car, which means EXPENSIVE to produce at all and not even possible to produce in volume (at least with the pressed steel technology currently in use by all volume manufacturers).
  
• Nobody wanted to buy them. Sure, there's all this noise now about how GM et al. should have been making dinky little economy cars, but if you take a look at the sales figures for the Honda Insight, which delivers 65+ MPG without even trying, it quickly becomes obvious that there was no market for a two seat economy car in the 90s and early 2000s. There were months when Honda was only able to sell a dozen Insights across the entire globe, and it's not a particularly wierd car compared to the EV-1.