MG has come a long way since the current MG3 hatch was revealed in China in 2011. Back then it was trying to get a foothold in the car market with cheap, basic vehicles in the way Kia and Hyundai did a couple of decades earlier. But now MG has gained credibility with the excellent MG4 EV, it’s embarking on a long-overdue refresh of the MG3 that could really worry the established European supermini opposition.

We’ve already produced our own renderings based on patent images of the upcoming MG3, but now we’ve got our first look at a real prototype out in the open. MG’s development team has been putting some miles on the subcompact hatch in Hungary ahead of its launch next year.

The all-new 3 will rival cars like the Toyota Yaris in both Europe and Asia and offers a new design characterized by slimmer, triangular-shaped headlights and a narrow, but wide lower grille. At the rear, the current car’s vertical light stacks are swapped for horizontal versions that wrap around the corner of the car. Those rear lights and and upward kick of the window line in the rear door make the back of the car look eerily similar to a Mercedes A-Class.

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Related: Design, Engines And Everything Else We Know About The New MG3

 Reborn MG3 Is Sticking With ICE Power To Keep Prices Low

Not that anyone expects any potential Mercedes buyers to be cross-shopping with the new MG3. The Chinese-owned company will continue to press its value message, and that’s one of the reasons why the 3 is sticking with combustion powertrains even when the bigger MG4 is only available as an EV. It’s simply not possible – at least not yet – for MG to build a smaller hatch with a fully electric powertrain at a sub-€20,000 ($21.5k / £17k) level.

That doesn’t mean the MG3 will miss out on electric power altogether. It’s expected to receive a 1.5-liter four-cylinder petrol engine that makes 107 hp (109 PS), which is then boosted by a 70 kW (94 hp / 95 PS) electric motor drawing from a tiny 2.1 kWh battery. And there’s more tech inside in the form of a 12.3-inch dual-screen display for instruments and infotainment.

Daniel Balogh for SH Proshots