Automakers produce compliance cars to satisfy government mandates, such as California's zero-emissions vehicle requirements, rather than for broad commercial success. These vehicles are usually existing internal combustion models retrofitted with battery packs and electric motors. They are typically sold at a loss in restricted markets and see minimal marketing effort.
They only lease that hatchback in three states because it's just a compliance car to keep their fleet average down.
Related terms
EV
An electric vehicle uses one or more electric motors for propulsion instead of an internal combustion engine.
CAFE
Corporate Average Fuel Economy regulations that mandate mileage standards for automakers.
LEV
Low-Emission Vehicle, a regulatory standard for cars that produce minimal tailpipe pollutants.