We'll admit that we're surprised by this latest piece of Mercedes-Benz product news, and you'll likely be too. According to Autocar, the German automaker is planning to launch a new A-Class sedan to not only North America, but also China and a few other markets by the end of 2018. The A-Class, if you didn't already know, is a front-wheel-drive-based hatchback currently sold in Europe, but that platform also underpins the CLA, a four-door coupe that's been selling like hotcakes in the US.

Autocar claims its unnamed source says that the A-Class compact sedan will fill the slot in between the CLA and C-Class sedans. Its specific target will be the Audi A3 sedan. It'll be a little bigger than the CLA from the outside but will supposedly offer as much interior space as the C-Class. 2018 is also when the next generation A-Class hatchback will arrive, so it's fair to assume the sedan version will be based on that. As far as engine options go, expect for there to be quite a range of options, including gasoline, diesel, hybrid and plug-in hybrids variants. The top trim A-Class sedan will probably come powered by an updated version of the current turbocharged 2.0-liter four-cylinder built by AMG, and will produce upwards of 400 hp.

Both a six-speed manual and a nine-speed automatic will be offered for most trims. Mercedes-Benz itself hasn't confirmed the report yet, but given how much success Audi is having with the A3 and S3 sedans, the former must see an opportunity to cash in even further. That's business.