"The Economics of Desire" is how Mercedes named its strategy update announced this week. Some big changes are planned as the three-pointed star will focus more on bigger and pricier models to the detriment of its entry-level offerings. The number of compact cars will be cut from the existing seven models to just four for the newly announced "Entry Luxury" class. The German marque is reserving less than 25 percent of total investments for it.

One of the new entry-level models was teased by chief designer Gorden Wagener during the presentation, so naturally, we had to take a screenshot. He refrained from going into any specific details, only saying the mysterious car will be "the most sophisticated, technologically advanced car with everything digital inside. I can promise you it's a true luxury car in that segment." 

Ok, but what exactly are we looking at? Well, it appears to be a sleek sedan, which leads us to believe it might be the next-generation CLA. With Mercedes saying it will cut back on the number of compact cars, it might merge the A-Class Sedan and CLA into a single model. We could go on speculating the CLA Shooting Brake doesn’t have a bright future either, but nothing is official at this point.

The model in question is expected to ride on the already announced MMA platform scheduled to debut in 2024. The architecture will be electric-first but not electric-exclusive. In other words, Mercedes' engineers are developing the hardware primarily for EVs and will make compromises in terms of packaging for the ICE models. It's the exact opposite of the strategy used for the EQA, EQB, and EQC crossovers as the three electric vehicles originate from ICE platforms.

Lessons learned from the Vision EQXX concept car will be put to good use in these new compact models, so range anxiety should finally become a thing of the past even in smaller vehicles. In an interview with Motor1.com earlier this year, Mercedes-Benz Chief Technology Officer Markus Schäfer warned us that EVs will still be more expensive than ICEs as cost parity won't be achieved in the foreseeable future.

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