Hoping to use its smaller cars to grow in developing countries, Mercedes-Benz has been testing the prospects for the B-Class in China since January.

"In the long run, we need a higher sales share for our smaller model lines as well," said Mercedes sales chief Klaus Maier in an interview with Automobilwoche. "China is now the test case on how we can do more business with future compact car generations than we are doing today."

Emerging markets such as China, Brazil, India and Russia are important pillars in the luxury automaker's strategy.

While mainly fully equipped luxury sedans and SUVS have been sold in these markets until now, Mercedes especially wants to grow globally with the next generation of the A- and B-Class. To cut costs, a new front-wheel drive platform and a modular kit have just been developed.

Last year, Mercedes sold 42,000 vehicles in China, up 39 percent. The E- and C-Class are already coming off the production line in Beijing, but all other Mercedes models are imported.

The demand is greatest for the brand's S-Class flagship. A total of 14,500 units have been delivered.

"In China and other emerging markets, we have strong representation with our luxury sedans such as the S- and E-Class, but also with the C-Class and the SUVs," Maier said. "In a growing distribution network, we need to strengthen our presence significantly."

With the introduction of the B-Class, Mercedes is now expanding its product portfolio at the lower end. "We'll see which other markets could follow," he said.

The response to the B-Class in China is very promising, he said.