India maybe one of the first markets to get the global small car being jointly developed by the Renault Nissan alliance and Mercedes Benz.

Daimler and the alliance earlier announced their plan to cooperate on platform and drivetrain sharing with Mercedes, Renault, Nissan and Smart working together on new models.

One of the first elements of the collaboration is Project Edison, a new small car that uses rear wheel drive powertrains, currently used in Smart cars.

The Hindustan Times quoted Daimler chairman Dieter Zetsche as saying: “We have worked very closely with Renault over the past year and if we are able to develop something suitable for the market, then India could get it.

"We know small cars is big in India and we are aware of the growth potential. There is a lot of work going on between Renault and Smart. The new A-class also has a high chance."

Despite being the first German luxury brand to launch in India, Mercedes has lost its number one position to BMW.

Zetsche said: “Competition is always good for the industry as it creates demand for luxury cars and it is [not only] in India that we are witnessing this.

"For sure, we are not at the top in terms of the number of cars sold but our profits are very healthy here and that to me is a more important consideration," he said. "Nevertheless, the product offensive will continue."