Vega/Pinto/Gremlin (& later Pacer) were not govt-mandated. They came before that The issue at the time was that the Falcon/Corvair/etc of the early 1960s, which were to combat the "flood" of VWs & other European cars, had gone away or grown up, and a new crop of small cars was seen as needed to combat the new flood of Japanese cars as well as what was left of the Europeans. As with the Corvair, GM tried some new things and lots of cheap things, and if anything did worse than they did with the early Corvairs. The Pinto was a reasonable competitor against the cheap British stuff, but nothing else, and was just much too small to be safe (when built as cheaply as it was) in a world of giant Chevys, Fords, and Plymouth Furies. the Gremlin was a AMC Hornet (not a great car to start with) with the back end cut off (never great for handling or structure). The main way the govt got involved was, after the first gas shock in 1973, to mandate that govt motor pools get small cars to save gas - which by then mean, via low bid and Buy American, Vegas, Pintos, and Gremlins. That probably kept them alive at least a couple of years longer than they should have.

Vega: couldn't get out of its own way, gas mileage maybe 20, engine melted down regularly (as did the actually govt-mandated methanol Luminas much later - a Chevy trait?), started rusting out even before delivery.
Pinto: rolling bomb with the gas tank stuck out behind the frame - one of the few cases where the 5mph bumper mandate actually improved the vehicle by forcing Ford to add some structure back there, gas mileage in the high teens (with a 10 gal. tank), couldn't get out of its own way, at least they didn't start rusting out until the winter after they were delivered.
Gremlin: I only saw these in the state fleet - local fleets kept using the Hornet because you could at least squeeze 4 adults into one, almost as heavy and thirsty as a Hornet and worse in all other aspects (if that could even be considered possible).

Those were the best that US car makers could do for small, "fuel-efficient" cars, as most people saw it. So they kept on buying Japanese cars which were improving each year or 2 (much shorter product cycle than anybody else) and otherwise strongly resembled small American cars. As emission controls got tighter in the mid-70s, the US small cars got even worse - nobody coped well until catalytic converters arrived in 1975-76 models, but the US models seemed to lose more than the others.

The real problem with the Vega/Pinto/Gremlin was that they were designed by accountants, not engineers. The govt wasn't into the car regulation game much until the 1973 models (some emission controls and 5mph bumpers) and later more emission controls, especially, had everybody playing catchup until the mid-1980s.

The one train-related thing I can think of in all this is the Verta-Pac car that SP and GM dreamed up for hauling a bunch of Vegas hanging vertically on their noses.