Mitsubishi Motors and Mitsubishi Heavy Industries announced Tuesday a joint development program for a next-generation diesel engine for the European market.

The new engine will be a 2-liter unit targeted at small and mid-size cars, and designed to meet the upcoming Euro5 emissions standards, which go into effect in 2010. Development of the new diesel will be completed in 2009, with production starting in 2010.

Mitsubishi currently markets its own diesels in the Pajero SUV for the European market, as well as the Triton (L200) pickup built in Thailand. However, its small and mid-size cars in Europe (the Colt and Lancer) use diesel engines sourced from Volkswagen and DaimlerChrysler.

[Source: Mitsubishi]

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