Stuttgart, Germany – Mercedes-Benz is in talks with BMW over the possibility of using its engines in future petrol models, a move that could reshape the rivalry between the two German luxury brands.
The discussions, which are already at an advanced stage, could see BMW supply its 2.0-litre four-cylinder engines to Mercedes models such as the CLA, GLA, GLB, C-Class, E-Class, GLC and the upcoming ‘Little G’. A decision is expected before the end of the year.
The partnership is seen as a cost-cutting measure for both manufacturers at a time when demand for electric cars has been slower than expected. For Mercedes, the deal would guarantee a Euro 7-compliant engine supply, allowing the brand to keep petrol and hybrid models in production while strengthening its plug-in hybrid line-up without spending heavily on new engine development. 
Mercedes has already launched its new 1.5-litre turbocharged M252 engine, built in China through a joint venture with Geely and Renault. However, the engine is only suited for mild-hybrid use and cannot be adapted for plug-in hybrids or range extenders, which is where BMW’s B48 engine could fit in.
The B48, built in Austria, is already used in most BMW and Mini models. Its ability to work across both compact and mid-sized cars makes it a strong candidate for integration into Mercedes’ future platforms.
Reports from Germany also suggest that the cooperation could go further, with the two companies exploring the possibility of a shared engine plant in the United States. Such a move would help them bypass rising import tariffs and reduce costs even more.
If the deal is sealed, it would mark the first time Mercedes and BMW share engines, a historic shift for two carmakers long known for their fierce competition.
