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Rivals Mercedes Benz & BMW Reportedly Nearing Partnership

German automakers BMW and Mercedes-Benz are said to be discussing a partnership to manufacture small cars.

Automotive rivals BMW and Mercedes-Benz could be nearing an unlikely partnership, per German publication Handelsblatt.

The car companies have been at odds for many years, sharing a sometimes bitter rivalry. But, according to the source named above, BMW chairman Harald Krüger and Daimler management board member Ola Källenius are exploring the possibilities of partnering up.

Such relationships are fairly commonplace among automakers. Ford and Volkswagen are said to be currently discussing moving forward together while Toyota has worked with other companies to develop performance models such as the latest release of the Supra. Chrysler, meanwhile, has probably worked with nearly every other car manufacturer.

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via netivist.com

BMW and Daimler, however, haven't been all that friendly - until now. The companies seem to be taking a "united we stand" approach and are looking to jointly absorb their hefty expenditure as they are keen on establishing a common industry standard for autonomous vehicles.

The latter is thought to be a secondary issue. The companies are aiming to develop next-generation compact cars but, with the demand for small cars lower than it has ever been, persons with information on the potential partnership reckon developing and manufacturing vehicles together could save both companies billions of dollars.

BMW and Mercedes share concerns regarding the cost of manufacturing self-driven vehicles to keep up with the heavy hitters in Silicon Valley. There is no clear winner in the race for autonomous cars in Europe just yet so the outfits are hoping to one day be able to offer an inexpensive alternative.

Initial discussions between the two entities focused on how to avert financial disaster if and when it ever comes to such a point in time.

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“Those who are the first to dominate autonomous driving, who are the first to offer a functioning autonomous taxi fleet, occupy a huge market,” Dietmar Voggenreiter from consulting firm Horváth & Partners said. “In the US, Waymo and Uber are hard to beat as platform operators but in Europe, roles are not yet dispersed.”

The rumored partnership would take years to come to fruition, however. And the companies could be slowed down by an investigation into whether or not they were members of a larger automotive cartel that worked together to manipulate the prices of auto parts.

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