Mercedes might use BMW engines.

[edyvw]

It seems market realities and Geopolitics are making Mercedes to turn to BMW for engines.
I really don’t know what to make out of this. BMW in the last three decades shared its engines with numerous manufacturers, most notably GM (Opel) and Toyota (while Supra is known in the US as BMW product, in Europe Toyota used BMW diesels far longer). But this seems just wrong. I get that MB has issues with new engines being made in China which are affected by tariffs, but why making it there in the first place?
That rivalry that spun some of the best vehicles in the world like M3 and AMG is coming not to simple bean counting. Yes, BMW can take bragging rights, but I don’t like this development. And what that tells about state that Mercedes is in? To turn to BMW?
Now I have seen everything!

https://www.caranddriver.com/news/a65874139/mercedes-benz-bmw-engine-deal-report/

 

[wemay]

Something wrong at Mercedes? You're right, this doesn't foretell of good things in this fierce rivalry.

 

[skyactiv]

I've never considered a new Mercedes, but I'd have a hard time buying a new one with a BMW engine just in principle.
My wife bought a new BMW 330i xDrive a few weeks age replacing the A4 quattro she had for 10 years. My only beef about her car is that it's assembled in Mexico and the brake pedal feel takes some getting use to. Her car is much peppier than her A4 was.

 

[ProbeGT]

An inevitable consequence of monumentally stupid decisions made not long ago. Rewind to 2019:
Daimler stops the development of future internal combustion engines and bets everything on the electric car

 

[SC Maintenance]

Just another example that there are too many car companies for a market with declining sales. Population non growth, add EV's - can't afford the millions to develop a new engine, not to mention go through the growing pains. BMW sure did on their 4 cylinder.

Ford and GM co-developed a transmission although they both build their own. Everyone uses the ZF transmission. Just about every other part from the alternator to the stamped sheet metal comes from somewhere else. I guess engine is no different.

 

[Trav]

It is a sad situation for sure.

 

[andrew_j]

If they come with a great engine it will be a win. The tuning likely will be left to car maker.

The 2.0T engine basis in my wife’s 18 Tiguan is shared with Porsche , Audi (even larger Q7). I understand same owners however it works. Each specific application is tuned differently.

 

[MrHorspwer]

BMW turned to GM for transmissions (5Lxx and 6Lxx). What did that say about the state of BMW at the time?

Absolutely nothing.

Because this line is a just fanboy's fever dream:

Yes, BMW can take bragging rights,

Publicly traded corporations don't talk about bragging rights. Internet forums do. Corporate boards talk about EBITDA, EPS, P/E ratios, and returning value to shareholders. That's what drives decision making, not "bragging rights".

Population non growth, add EV's - can't afford the millions to develop a new engine, not to mention go through the growing pains.

And here's the answer. Any growth in the auto industry is going to come from EV sales. Developing a new ICE propulsion platform is investing in a market that is losing share. That is throwing good money after bad. So you co-develop products, share the development cost, and stretch your investment dollars.

 

[Vercingetorix]

Better BMW than Renault.

 

[edyvw]

BMW turned to GM for transmissions (5Lxx and 6Lxx). What did that say about the state of BMW at the time?

Absolutely nothing.

Because this line is a just fanboy's fever dream:


Publicly traded corporations don't talk about bragging rights. Internet forums do. Corporate boards talk about EBITDA, EPS, P/E ratios, and returning value to shareholders. That's what drives decision making, not "bragging rights".



And here's the answer. Any growth in the auto industry is going to come from EV sales. Developing a new ICE propulsion platform is investing in a market that is losing share. That is throwing good money after bad. So you co-develop products, share the development cost, and stretch your investment dollars.

Did you have coffee this morning?
BMW did not "turn" to GM transmissions. BMW always used ZF transmissions. They used GM bcs. it fit certain models and, well, it was cheaper. BMW and ZF always develop transmissions together.

As for bragging rights, you obviously never spent time in German automotive circles.

 

[JeffKeryk]

It seems market realities and Geopolitics are making Mercedes to turn to BMW for engines.
I really don’t know what to make out of this. BMW in the last three decades shared its engines with numerous manufacturers, most notably GM (Opel) and Toyota (while Supra is known in the US as BMW product, in Europe Toyota used BMW diesels far longer). But this seems just wrong. I get that MB has issues with new engines being made in China which are affected by tariffs, but why making it there in the first place?
That rivalry that spun some of the best vehicles in the world like M3 and AMG is coming not to simple bean counting. Yes, BMW can take bragging rights, but I don’t like this development. And what that tells about state that Mercedes is in? To turn to BMW?
Now I have seen everything!

https://www.caranddriver.com/news/a65874139/mercedes-benz-bmw-engine-deal-report/

Doesn't just about every major car manufacturer engineers and/or manufactures in China?

 

[SC Maintenance]

Doesn't just about every major car manufacturer engineers and/or manufactures in China?

Many did, and many are now closing them. You could never really "have" a manufacturing plant in China. You had to partner with a Chinese entity, and turn over all your IP to them. Finally companies are wising up and pulling out.

 

[edyvw]

Doesn't just about every major car manufacturer engineers and/or manufactures in China?

They do for that market. But BMW was limiting for a long time engine production to Germany and later to Austria. Their Chinese plant is strictly limited to joint venture with Brilliance, and India plant is only regional supplier.
MB idea was to manufacture in China and export elsewhere. That is where they got hit by tariffs. Also, it seems new 4cyl plant is not very good in classic hybrid set up.

 

[JeffKeryk]

Many did, and many are now closing them. You could never really "have" a manufacturing plant in China. You had to partner with a Chinese entity, and turn over all your IP to them. Finally companies are wising up and pulling out.

It ain't that simple. Not to mention China is the largest car market in the world. And then there's the engineering talent...

 

[SC Maintenance]

It ain't that simple. Not to mention China is the largest car market in the world. And then there's the engineering talent...

Actually it is quite that simple. Explain to me how it is not.

Yes, it was much easier or even the only way to sell into the China market from China, if that is what you were referring to. But you were choosing to risk IP copy for the benefit of entering China.

 

[JeffKeryk]

Actually it is quite that simple. Explain to me how it is not.

Yes, it was much easier or even the only way to sell into the China market from China, if that is what you were referring to. But you were choosing to risk IP copy for the benefit of entering China.

I was referring to money. Factories cost a lot. Engineers and workers cost a lot.
Pulling out is a major decision. And who knows what will happen tomorrow?

 

[SC Maintenance]

Money. Factories cost a lot. Engineers and workers cost a lot.

Yes, but if you put all that money into China it can never leave. Total Hotel California. Companies are finding that out now. Of course the CEO's that did it 30 years ago did not care.

There are China factories that literally run parts for whatever Western company they are working for during the day, then they will run the same part for some Chinese company that is making knock off's at night, on the same German tooling that was bought and paid for and shipped in by the Western Company. So go to China, your directly paying for your Chinese competitor to compete with you.

Chevy Spark is perfect example Chevy built Spark in China mainly to sell in China. Shortly after - Chinese company named Chery - note only one letter difference, came out with the QQ. Same car. https://en.wikipedia.org/wiki/Chery_QQ3#First_generation_(2003–2015)

Nissan used (leaving) Dongfeng, and I think Honda did also. GM uses SAIC. etc etc.

 

[trd1zz]

Any growth in the auto industry is going to come from EV sales. Developing a new ICE propulsion platform is investing in a market that is losing share. That is throwing good money after bad. So you co-develop products, share the development cost, and stretch your investment dollars.

And how have Mercedes EV sales done in the US?

 

[rijndael]

And how have Mercedes EV sales done in the US?

Not sure, but the used ones can be had at very huge discount. Just a couple of year old EQS is like 50-60% off MSRP.

 

[Vercingetorix]

And the resale on S class and Maybach is?