I rented an Economy car when I was in Ireland. They gave me a Kia Rio sedan. It’s actually a bit larger than many other cars I saw on the roads. By my casual observation, the most popular cars in Ireland are (in no particular order) Opel Corsa, Peugeot 207, and Nissan Micra. According to Wikipedia, they all belong to a category called "supermini," basically subcompact here in the U.S. The comparable cars in the U.S. would be a Honda Fit or a Toyota Yaris. After coming back to the U.S. and driving my much larger Honda Accord, I don’t know why cars in the U.S. have to be that big. Those smaller cars do the job just fine.
The cheap gas price in the U.S. certainly has something to do with it. Unleaded gas in Ireland (called "petrol") was 1.12 Euros a liter. That’s about $6 a gallon in Ireland, versus $2.50 a gallon in the U.S. I don’t know if they sell hybrid cars in Ireland. I did not see a single Prius when I was there. Perhaps hybrids are the future, but we can go a long way toward reducing fossil fuel consumption if only small cars are more popular in the U.S. Making gas more expensive is certainly one way to induce that.