Mercedes-Benz has confirmed one of its worst-kept secrets that it will produce a new compact SUV at its Rastatt plant in Germany alongside the new A-Class and B-Class with which it shares its platform.

As previously reported by CarAdvice, the new baby SUV, potentially to be called the BLK or GLC, will join Mercedes’ Australian line-up by 2014 to take on the Audi Q3 and BMW X1.

Mercedes-Benz says the compact SUV will become the third model to roll off the Rastatt production line, and will be one of five small models constructed on the brand’s new ‘MFA’ platform, which include the A-Class hatchback, B-Class MPV, the CLA/CLC ‘four-door coupe’ due early next year, and potentially the SLC sports car further down the track.

Production of the five MFA-based models will be split between Rastatt and Mercedes’ new plant in Kecskemet, Hungary, which opened in March.

The ‘BLK’ will join an expanded SUV line-up from Mercedes-Benz Australia that will also include the next-generation mid-sized GLK, which will be engineered in right-hand drive to compete with the Audi Q5 and BMW X3.

The confirmation of the compact SUV came as the first new A-Class rolled off the Rastatt production line. The new A-Class will land in local showrooms in the first quarter of 2013 with an anticipated sub-$40,000 starting price to match the new Audi A3 and the BMW 1-Series.

Mercedes’s parent company, Daimler, has already invested 600 million euros ($715 million) into Rastatt for the construction of a new bodyshell building and for tools, and will invest another 600 million euros by 2013 to fund modifications to the assembly line and further equipment installations.

An additional 400 million euros ($477 million) will be invested into powertrain plants before the end of next year for production of components used exclusively by the new compact models.

The Rastatt expansion has created 900 new permanent jobs since 2010, including 500 in 2012 alone.
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