Mercedes-Benz is set to join forces with Renault in a deal aimed at providing its underdeveloped Smart division with a contemporary-engineered front-engine/front-wheel-drive platform as the basis for a frugal new Forfour model.

The new Smart, due out in 2013, is planned to sit on a lightly modified version of the Renault Twingo’s underpinnings, complete with a 93.3-inch wheelbase.

Speaking about the new car over the weekend, a highly placed Mercedes-Benz official told AutoWeek: “It’s a key component in plans to grow the Smart brand. We’re looking to diverge into other potentially lucrative market segments, and not only in Europe but on a worldwide basis, including North America.”

In keeping with its name, the new Forfour was conceived to offer seating for up to four adults in a steel body that is expected to stretch to no more than 141.7 inches in length, 66.9 inches in width and 59 inches in height. As with the first-generation Forfour developed in cooperation with Mitsubishi and launched in 1998, the second-generation model also is set to boast a five-door hatchback design.

At this early stage, it is not known whether the deal between Mercedes-Benz and Renault will extend to engines and gearboxes, although German media reports suggest that the two are looking at deep integration between the new Forfour and the Twingo in a move aimed at extracting the sort of economies of scale achieved by rival carmakers PSA Peugeot-Citroën and Toyota with their similarly sized C1, 106 and Aygo.

This would suggest further collaboration on small-capacity gasoline and diesel units, including possibly a new generation of highly efficient three-cylinder engines already under development at Mercedes-Benz. At the heart of plans for the new Forfour also is a plug-in electric version. Nothing’s official just yet, but it could include technology being developed by Renault partner Nissan, which is introducing its own plug-in electric model, the Leaf.

AutoWeek sources suggest that Mercedes-Benz boss Dieter Zetsche will announce the collaboration with Renault at the upcoming Frankfurt motor show, where he also is expected to reveal further details about the future of the Smart brand, which is planned to grow its lineup to encompass at least three new models by the middle of the next decade, including a radical three-seater sports car.