Mercedes-Benz parent company Daimler and China's Geely have formed a partnership that will see the two companies collaborate on the next generation of electric vehicles sold under Daimler's Smart brand.

In today's announcement, Mercedes-Benz revealed it would continue to design Smart's cars while Geely would look after the engineering side of the equation.

The German and Chinese companies say they will manufacture the next-gen Smarts in China at a purpose-built factory. Once that facility is online, the Hambach, France plant that builds the current Smart lineup (including the ForTwo city car sold in Canada) will make electric vehicles for the Benz EQ electric vehicle sub-brand.

Mercedes-Benz and Geely said global sales of the first co-developed Smart will begin in 2022. The two companies said they also plan to expand the Smart range into the (relatively) larger B-segment, known in North America as the subcompact class. That would see Smart position itself as a premium option next to popular models like the Toyota Yaris, Hyundai Accent and Chevrolet Sonic.

We reached out to Mercedes-Benz for confirmation the German-Chinese Smart models would be sold in Canada but didn't receive a reply by publication time.

Smart began selling its two-seat ForTwo in Canada in 2006. In 2013, Mercedes-Benz Canada added the battery-powered ForTwo Electric Drive to the lineup, and in 2018 it eliminated the gasoline version, effectively turning Smart into an EV-only brand. This year, it renamed the car the Smart EQ ForTwo.