It's basically OK for one of the use-cases for small cars - the second runaround that doesn't do long journeys - but not for the other one - the (typically young) person who does plenty of long journeys but can't afford a car more suitable for them.
Of course there's nothing that says the same car needs to be usable for both use-cases. It might mean lower residual values if there's a smaller pool of buyers, but people will always want runaround type small cars.
I would still question how many 80+ mile trips most people (young or old) actually make.
As I've said before I'm a slightly extreme example (due to regular trips to see family at about 240 miles) and whilst we would need a primary car which could do a decent range, we are usual in the number of trips we make of that distance. However, given that we are in the average, to make the average work, there's got to be people who don't make nearly as many 50+ mile trips as the average.
As I've said before, there's a good chance that for a once a year return journey people could change what they do. For example, rather than rushing to get to the holiday home, they leave early, stop off somewhere for breakfast (charge the car), then go for a day trip (charge the car), they then drive to somewhere for an evening meal (charge the car), arrive at where they are staying.
In doing so they could probably travel 200 miles, do something during the day and still get to where they are going on holiday. However rather than spending 4 hours in the car with a short lunch break, they break up the journey so it's much more pleasant. Not least as (assuming it's during the summer) that they aren't traveling in the middle of the day when it could be very hot, it's also likely that they'll miss the middle of the day congestion and/or will be aware of where there's likely to be issues and be able to divert past at least some of them.