Overview

• Reports from Manager Magazin and Autocar describe high-level negotiations, with a Mercedes source signaling a possible announcement before the end of 2025 as BMW maintains public silence.
• The likely candidate is BMW’s 2.0-liter B48, which meets Euro 7 standards and is engineered for both longitudinal and transverse installations with support for plug-in hybrid and range-extender roles.
• Targeted applications reportedly span the CLA, GLA, GLB, C-Class, E-Class, GLC and the upcoming “Little G,” with the first BMW-powered Mercedes models estimated to reach production around 2027.
• Production discussions include tapping spare capacity at BMW’s Steyr engine plant in Austria and exploring a shared U.S. facility to mitigate tariff exposure.
• Mercedes’ new in-house 1.5-liter M252, built in China by the Horse joint venture, suits mild-hybrid use but is not designed for PHEV or range-extender duty, prompting the search for an alternative.