Mercedes might have to rethink its EV naming strategy.

Mercedes-Benz is facing a new lawsuit from Chinese automaker Chery Automobile Co Ltd over its use of the "EQ" nameplate for a new line of environmentally-friendly vehicles.

Late last year Mercedes unveiled its all-electric Generation EQ concept car and announced plans for a production version to launch before the end of the decade. However, such a vehicle might have to be re-branded in China as Chery claims the EQ name is too similar to the eQ brand it already uses for electric vehicles in its home country.

"If it entered the Chinese market, it would impact our trademark rights," a Chery spokeswoman told Reuters.

"Mercedes Benz EQ and our (eQ) are extremely similar. Their product is also an electric car."

The lawsuit presumably extends to other version of the EQ name. Mercedes was planning to use the "EQ Power" designation for hybrid models and "EQ Power+" for electrified AMG models.

It's possible that Mercedes could brand its EQ models differently outside of China, but that could cause a marketing headache. Moreover, China is the largest electric vehicle market in the world, so Mercedes needs to get its rollout plan in perfect order.

No word on when the lawsuit will be heard.

Live photo by Ronan Glon.