The Mercedes-Benz Concept EQA
Photo: Mercedes

Mercedes-Benz hasn’t been shy about its intention to flood the world with new electric cars, but one thing still up in the air was if it wanted to put an electric compact car into production. Now, we have an answer. On Friday, the German automaker said it’s dropping nearly $600 million on a factory expansion to start producing an all-electric small compact car.

As Reuters teed it up, it’s full proof that Mercedes is looking to make a “Tesla rivaling” electric car.

Here’s more from Reuters:

It plans to launch more than 10 electric vehicles for Mercedes-Benz Cars by 2022 as U.S. rival Tesla struggles to ramp up production of its Tesla Model 3.

“The Smart plant in Hambach will become a part of our global compact car production network with the lead plant in Rastatt, Germany,” Mercedes-Benz production chief Markus Schaefer said in a statement on Friday.

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Mercedes said last month that the S-class is going all-electric, and it debuted a concept last fall called the EQA, which has a claimed range of 248 miles, so again, this isn’t a terribly surprising move. But it underscores just how much competition Tesla’s going to face in the coming years.