The front-wheel-drive car's four-cylinder engine is mated to a dual-clutch transmission.
Other features include a radar-based collision warning system and adaptive brake assist, which minimizes the odds of rear-end collisions.
The Concept A-Class, which goes on sale next year, would seem to pose some risks for Mercedes in a market like China.
Wealthy Chinese car owners prefer to be chauffeured, so the German luxury brands have successfully introduced "stretch" sedans with roomier rear seats. Last July, Mercedes introduced its E300L, a long-wheelbase E-class model that is selling well.
By contrast, Daimler's Smart cars have been modest sellers in China. To give Smart a boost, Mercedes rolled out a new Chinese ad campaign featuring NBA basketball star Kobe Bryant.
The campaign appears to be working; Smart sales in China rose sixfold in March. The turnaround suggests there may be a profitable urban market in China for small luxury cars.
Audi to unveil Q3
Audi, China's best-selling luxury brand, is entering China's red-hot SUV segment with the Q3 crossover. As yet, Audi hasn't offered details about the car.
According to enthusiast magazines, the Q3 will be powered by a range of turbocharged four-cylinder engines generating up to 200 hp. The Q3 will allow Audi to compete against rivals such as the BMW X1.
While Mercedes and Audi highlight new models in the small-car segment, BMW is exploring China's appetite for EVs.
At the Shanghai show, BMW will unveil a plug-in hybrid concept derived from its stretch 5-series sedan. According to BMW, the car can travel up to 46 miles on batteries alone. The turbocharged gasoline engine and electric motor together generate 230 kilowatts of power.
The concept's debut in Shanghai will give BMW an opportunity to highlight its other EV programs. In 2011, the company launched a fleet of electric-powered Minis in Beijing and Shenzhen.
Later this year, BMW also will begin road tests of the ActiveE, an electric version of its 1-series coupe.
For more traditional BMW enthusiasts, the German automaker has scheduled the global launch of its Concept M5.
The M5 is powered by a twin-turbocharged 4.4-liter V-8 engine mated to a seven-speed double-clutch transmission. According to AutoWeek, a sister publication of Automotive News, the powertrain should generate 560 hp.