Well, I would say there isn't a huge penalty for the benefits, and it's nice to have 110% of your maximum expected needs covered rather than 80%. And big vehicles keep getting better and better fuel economy, plus scaled down versions aren't significantly cheaper.

I think a major issue is that most of the cost of a car is not in the quantity of metal used to make the body/frame. So you aren't going to cut manufacturing costs much by making it smaller. This is probably why nobody can make small cars at a profit in the US. Any additional amount a customer will pay for a larger vehicle goes disproportionately to profit, so it's a win-win for the manufacturer and customer.