As some of you will remember, Mercedes' strategy update from 2022 included an early look at a CLA-like compact saloon. It's scheduled to go into production in 2024 at the Kecskemét plant in Hungary following a €1 billion investment. The teaser image showed a silhouette of a swoopy four-door car penned by Gorden Wagener, the company's chief designer. A more substantial preview could take place later this year, according to CEO Ola Källenius.

When asked by Automotive News Europe whether compact cars still have a future in Mercedes' lineup as it strives to go even more upmarket, the top brass said: "The short answer is yes. But we will focus on the models that we believe are the most successful on a worldwide basis. We might later this year even tease what that future would look like."

Mercedes Entry-Level Luxury Car teaser

The upcoming small car will be the first to ride on the new Mercedes Modular Architecture (MMA), which will be electric-first but not electric-only by making compromises only on the ICE side. This CLA replacement will be one of the four members of the "Entry Luxury" class as the three-pointed star aims to axe three of its current compact vehicles. Rumour has it the A-Class hatchback, A-Class saloon, and the B-Class MPV are going away, leaving only the CLA, CLA Shooting Brake, GLA, and GLB.

This new wave of compact cars is expected to come with higher prices while "elevating the technological substance." The latter part refers to a new MB.OS software architecture and adopting innovations from the Vision EQXX program. Although Mercedes remains committed to compact cars, 75 percent of its total future investments are reserved for larger vehicles (from C-Class and up) since these have higher profit margins.

While the current GLA and GLB have electric equivalents, that's not the case for the CLA. The situation should change with the successor since the MMA platform will be primarily about electric models. If a recent report is to be believed, Mercedes will begin to gradually drop "EQ" branding from its zero-emissions models as early as 2024. The first will either be an MMA-based car or the electric G-Class.

As a final note, a new report states Mercedes is plotting a "baby G-Class" on the same MMA architecture for a 2026 release with combustion engines and an electric drivetrain.