Mercedes Plans New Entry-Level Car Because Volume Matters

The A-Class is dying, but a new base model is coming.

Mercedes A-Class

Photo by: Mercedes-Benz

Adrian Padeanu

By: Adrian Padeanu

Sep 23, 2025 at 4:30am ET

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It’s been a few years since Mercedes stopped selling the A-Class in the United States, but the baby Benz remains alive and well in other parts of the world. Citing strong demand in Europe, the three-pointed star has extended the life cycle of its entry-level car by two years, until 2028. By then, the compact hatchback and sedan will be a decade old.

That’s unusually long for a luxury brand, but it shows how often automakers misjudge what customers want. Mercedes once planned to go fully electric as early as 2030, “where market conditions allow,” yet the updated agenda keeps combustion engines alive well into the next decade, and possibly beyond. As part of that shift, another entry-level model is on the way.

The move makes sense given the massive price gap between the A-Class and the new electric CLA. The former starts at about €34,400 in Germany, while the latter comes in at nearly €56,000. Yes, the combustion-powered CLA will be cheaper, but there will likely still be a five-digit gap. Once the A-Class bows out, the base Mercedes will start somewhere in the mid-€40,000s.

A high-ranking Mercedes official confirmed to Automobilwoche that a true entry-level car to succeed the A-Class is in development. Mathias Geisen, management board member for marketing and sales, made it crystal clear that a sub-CLA model is coming: “Believe me: in the long term, there will be an entry-level model in the Mercedes-Benz world.”

Naturally, a cheaper car won’t deliver the same profits as models from higher segments. Still, even if margins are slimmer, greater sales volume will help balance the books. Competitors are also sticking with their affordable models, with BMW continuing to sell the 1 Series and Audi the A3. It's a formula that has worked for decades, so it makes sense for premium brands to keep their entry-level cars.

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It’s unclear what shape the cheapest Merc will take. Automobilwoche speculates it could be a crossover, though we’d much prefer a CLA hatchback or something similar instead of just another SUV. In the meantime, the A-Class will continue as both a five-door hatch and a four-door sedan. One compact Mercedes, however, is nearing the end: the B-Class minivan will be discontinued in 2026.

Mercedes also still has the Smart brand. Well, half of it. Six years ago, the automaker formed a 50:50 joint venture with Geely, with all subsequent cars built in China. A spiritual successor to the ForTwo is due in late 2026, becoming the most affordable car with Mercedes roots. The catch? It’ll only be offered as an EV and has little chance of making it to North America.

Catch Up With Mercedes:

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Mercedes Design Boss Slams BMW and Audi For Their New Interiors

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