Mercedes-Benz working on an entry-level car to replace A-Class

**Mercedes-Benz Developing New Entry-Level Car to Replace A-Class**

*By Dwaipayan Roy | September 24, 2025 – 1:35 PM*

Mercedes-Benz is gearing up to launch a new entry-level model as part of its strategy to boost sales volume. This move comes on the heels of the company extending the lifecycle of its popular A-Class hatchback and sedan by an additional two years, pushing production until 2028. This decision underscores how automakers sometimes reassess market demands and customer preferences to stay competitive.

### Strategic Shift: Hybrid Over Fully Electric

Previously committed to a fully electric lineup by 2030 “where market conditions allow,” Mercedes-Benz has updated its approach. The automaker now plans to keep combustion engines alive well into the next decade, possibly beyond, signaling a shift towards a hybrid strategy. This broader change includes developing a new entry-level model designed to fill the pricing gap between existing vehicles in its portfolio.

### Filling the Price Gap

The upcoming entry-level car will occupy the space between the current A-Class and the forthcoming electric CLA. In Germany, the A-Class starts at approximately €34,400. Meanwhile, the combustion-powered CLA, although less expensive than its electric counterpart, remains pricier than the A-Class, creating a significant price gap. Once the A-Class is eventually phased out, Mercedes-Benz’s base offering will likely start in the mid-€40,000s range.

### Official Confirmation

Mathias Geisen, Mercedes-Benz’s management board member for marketing and sales, confirmed that the new entry-level car is in development. He remarked, “Believe me: in the long term, there will be an entry-level model in the Mercedes-Benz world,” affirming the company’s commitment to catering to a broader customer base.

### Market Strategy: Balancing Volume and Premium Appeal

While launching a more affordable vehicle may not generate as much profit per unit compared to higher-end models, increased sales volume can help balance Mercedes-Benz’s overall financials. This approach mirrors strategies from other premium brands like BMW and Audi, which continue to offer competitively priced models without compromising their luxury image.

### Design and Features: What to Expect?

Details about the design and features of the new entry-level model remain under wraps. Automotive publication Automobilwoche speculates the vehicle might be a crossover, though many enthusiasts hope for a CLA hatchback or a similar stylish offering rather than yet another SUV.

For now, Mercedes-Benz will continue to produce the A-Class in both five-door hatchback and four-door sedan variants across global markets until the new model arrives.

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Stay tuned for more updates on Mercedes-Benz’s exciting plans to evolve its entry-level lineup and redefine premium accessibility.
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