SMART carMitsubishi Motors Corporation and smart, maker of the fortwo minicar, have signed an agreement on engine production. Mitsubishi Motors will supply an engine similar to the turbocharged unit developed for the i minicar that will launch in January 2006. This new engine will be further developed to be used in smart's next generation fortwo. The Mitsubishi engine will be slightly enlarged to 700cc for the smart application, so power figures should be a bit higher. The new smart fortwo is scheduled to arrive in 2007, but Mitsubishi may begin supplying the engines as early as 2006. In its current 660cc form the turbocharged three-cylinder produces about 63 hp, which is slighty more than the top of the line gasoline engine found in the smart fortwo. Mitsubishi will be building these engines at its Mizushima facility.
Mitsubishi and smart already cooperate quite a bit, with the Mitsubishi Colt and smart forfour sharing production facilities at NedCar, a automotive assembly plant in the Netherlands. With smart looking to cut costs, and Mitsubishi looking to sell its manufacturing capacity, this is a win-win deal for both companies. Nihon Keizai Shimbun reported on this a couple weeks ago, but Mitsubishi just confirmed this morning.

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