A fresh report suggests Daimler is considering phasing out its Smart brand and filling the void with a new small Mercedes-Benz model tentatively dubbed the U-Class.

According to Automobile, “various sources” suggest the Smart brand will be axed by 2026 at the earliest.

Why? Well, the platform underpinning both the ForTwo and the ForFour was developed in partnership with Renault (which runs the Twingo on the same architecture), but the French brand is apparently planning on pulling out of the deal at the end of the vehicles' current life cycles.

Daimler, meanwhile, seemingly isn’t keen to go it alone on such a project, particularly since the Smart brand – which is interestingly in the process of going fully electric – isn’t exactly a roaring financial success. The only way the Smart brand could survive, the report adds, is through a partnership with a “strong” Chinese brand such as Geely.

If Smart is indeed axed, the publication furthermore reports Daimler will make a decision by 2021 on whether or not to replace these products with a Mercedes-badged model, which would likely be based on a next-generation modular platform (also expected to underpin the next A-Class).

The resulting U-Class – Automobile suggests the “U” would stand for both “urban” and “universal” – would be offered as a small hatchback positioned below the A-Class.