Mercedes-Benz and BMW in Talks for Engine Partnership: A New Era for German Automakers

In a surprising move, Mercedes-Benz and BMW are discussing an engine-sharing agreement, signaling a potential shift in the competitive landscape of the German automotive industry. The collaboration, if it materializes, would be a first of its kind. Mercedes is considering integrating BMW’s B48 four-cylinder turbocharged engine into its forthcoming petrol and plug-in hybrid models. This engine is already successfully utilized in BMW and Mini cars, known for its versatility across various car platforms. This versatility allows its integration in models like the Mercedes CLA, GLA, GLB, C-Class, E-Class, and the upcoming Little G SUV. Mercedes’ existing 1.5-liter M252 engine is adequate for mild-hybrid applications, but lacks the capabilities for plug-in hybrid or range-extender setups. The B48 engine provides a solution to this limitation. Engine production could potentially be at BMW’s Steyr plant in Austria. Additionally, both companies are exploring establishing a joint factory in the United States to address growing import tariffs. Mercedes will gain access to a certified, Euro-7 compliant engine, reducing R&D costs and facilitating the expansion of its plug-in hybrid offerings. BMW stands to benefit by optimizing its production capacity and enhancing its factory’s efficiency through a larger engine supply.