After decades of rivalry, Mercedes-Benz and BMW may soon find themselves in an unlikely partnership. According to a report by Manager Magazin, Mercedes is exploring the possibility of sourcing four-cylinder engines from BMW, a move that would mark one of the most surprising shifts in the modern automotive industry. While BMW has not confirmed the development, industry insiders suggest that discussions have been ongoing for nearly a year.

The timing of these talks comes as Mercedes faces financial headwinds. At the end of July, CEO Ola Källenius reported weaker-than-expected results, with profit margins in its passenger car business dropping to 3.2 per cent during the second quarter. Sales for the first half of the year stood at just 900,000 units, the lowest since 2020. Internally, Källenius told his management team that cost-cutting alone would not be enough if the company lacked the right products to meet demand.

One of Mercedes’ immediate challenges lies in its engine supply. The Stuttgart-based brand underestimated the number of combustion engines required to support its plug-in hybrid models. Initially, Mercedes sought to cover the shortfall by sourcing four-cylinder units from Geely in China, but political sensitivities in key markets such as the United States have made the use of Chinese-built engines increasingly problematic. This has pushed the company to explore cooperation closer to home, with BMW emerging as the most viable option.

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