As reported in late May, Mercedes-Benz will work with racing partner H.W.A. on its next supercar, rather than McLaren. But rather than replacing the Mercedes-McLaren SLR, the car will rival the Audi R8, according to a new report.

While the SLR costs a whopping $455,000, the new mid-engine sports car will be more attainable, costing closer to $110,000, according to Automotive News.

Sales of the SLR have been disappointing, so rather than chasing the ultra-expensive market with its next super sports car, Mercedes stay closer to its $100,000 comfort zone.

Rumors about a mid-engine Mercedes have been circulating for years, dating back to the alleged "P8" project, which was eventually cancelled.

Last summer, Germany's Auto Motor und Sport said Mercedes was getting ready to rival the R8, and in January insiders at Brenda Priddy & Company said a new model called the "SLS" would fill that role. (See illustrations below).

As recently reported by Auto Zeitung, BMW may too be getting ready to do battle with the R8. According to the German magazine, the BMW "M10" will serve as a spiritual successor to the M1, with the R8 as its main rival.