Mercedes is looking to Romania and Poland as potential locations to build a new plant. The plant would build the next generation of A and B class models.

According to recent reports, Mercedes is looking at building a new plant in Romania or Poland. The plant would produce the next generation of Mercedes entry level A and B class models which are expected in 2011.

Company insiders say that so far it appears that Romania is the leading candidate where the current labor rate is 3.23 euros, compared to Poland’s 6 euros and Germany’s 42 euros. This is an important figure that plays into the entry level model’s profit margin, one of the reasons the company decided against bringing the B-Class to the United States. Possible locations for the new plant include Jucu, Romania and Cluj where the mayor has already acknowledged having talked to Mercedes.

Production at Germany’s Rastatt plant, which currently produces the vehicles, would also be expanded.

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