The head of Smart cars has denied speculation that parent company DaimlerChrysler may sell or even close the loss-making subsidiary.
In a leaked letter to Smart employees, Ulrich Walker said that while the firm was still not making money, "the existence of Smart is not at stake".
His comments came after a Daimler senior director said "all alternatives" for Smart were being looked at.
The distinctive city car firm has not made a profit since it started in 1998.
"Giving up the Smart brand or selling our business is not being discussed," said Mr Walker.
"[Chief Executive] Juergen Schrempp and [Mercedes Car Group head] Eckhard Cordes confirmed this to me personally in conversations yesterday."
Persistent losses
A DaimlerChrysler spokesman said the closure or sale of Smart is not under consideration but the group is discussing plans to make the company profitable.
The persistent losses at Smart were a major contributing factor to the quarterly fall in profits at Mercedes, DaimlerChrysler's key German car-making division, of which Smart is a further subsidiary.
Third-quarter operating profits at Mercedes were down 62% year-on-year at 304m euros (£211m; $386m), it was announced on Thursday.
DaimylerChrysler chief financial officer Manfred Gentz said Smart had shown a "strong deterioration".