NIHAO V: Too big doesn't fail -- reconciling the conflict between LCDM predictions and the circular velocities of nearby field galaxies

We compare the half-light circular velocities, V-1/2, of dwarf galaxies in the Local Group to the predicted circular velocity curves of galaxies in the Numerical Investigations of Hundred Astrophysical Objects (NIHAO) suite of Lambda cold dark matter (Lambda CDM) simulations. We use a subset of 34 simulations in which the central galaxy has a stellar luminosity in the range 0.5 x 10(5) < L-V/L-circle dot < 2 x 10(8). The NIHAOgalaxy simulations reproduce the relation between stellar mass and halo mass from abundance matching, as well as the observed half-light size versus luminosity relation. The corresponding dissipationless simulations overpredict the V-1/2, recovering the problem known as too big to fail (TBTF). By contrast, the NIHAO simulations have expanded dark matter haloes, and provide an excellent match to the distribution of V-1/2 for galaxies with L-V greater than or similar to 2 x 10(6) L-circle dot. For lower luminosities, our simulations predict very little halo response, and tend to overpredict the observed circular velocities. In the context of Lambda CDM, this could signal the increased stochasticity of star formation in haloes below M-halo similar to 10(10) M-circle dot, or the role of environmental effects. Thus, haloes that are 'TBTF', do not fail Lambda CDM, but haloes that are 'too small to pass' (the galaxy formation threshold) provide a future test of Lambda CDM.