This is the upcoming 2008 Mercedes C-Class, caught testing in the Californian desert under heavyweight cladding.
We can expect an official unveiling at Geneva 2007 with sales soon after. And expect the wagon - or estate version - to arrive six months later in the autumn.
Sources state a cabriolet soft-top and coupé are also planned, which can only be taken as being the new CLK-Class which is based on the same platform.
Although it will share more of its components than before with the larger E-Class, the next C-Class will be much sharper to drive and more distinctive as a range in its own right: Mercedes is to position it as a true small sports saloon, rather than simply a smaller answer to the E-Class.
Air suspension or active body control have been ruled out due to cost restraints. Base engine will be a direct injection 4-cylinder 1.8-litre with varying horsepower from 150bhp to 190bhp. Horsepower for the 2.5-litre V6 and 3.5-litre V6 will be 210bhp to 270bhp respectively.
AMG's 5.4-litre will be revised with new horsepower rating up from today's 360 to 410bhp to compete with the Audi RS4 and the future BMW M3. A 3-litre diesel is planned as well as the new central control knob - similar to BMW's iDrive and currently featured in the new S-Class. 4MATIC all-wheel-drive system will also remain available.