A couple of years ago, BMW said it wanted out of the joint engine game with Peugeot. Today, not only are the two companies still sharing powerplants – the PSA engines that go in the Mini and Pugs like the 207 – but BMW's head has recently stated that the automaker is considering sharing small car platforms with PSA. To that, PSA head Phillipe Varin has gone a step further, saying he'd also like to extend the agreement to things like purchasing, transmissions, and HVAC units.

The quest for Peugeot is to find a way to remain independent to continue to make money doing it. The French automaker expects an operating loss of up to €1.5 billion ($2.25B U.S.) this year, which is less than expected. But the company foresees a return to black next year, and part of the strategy for that would be lowering costs through tie-ups, such as its deal to sell rebranded Mitsubishi i-Mievs.

Nevertheless, it will be BMW that needs to see sense in a stronger PSA union. Items like HVAC units and transmissions – when they work – are anonymous; no one knows or really cares where they come from. As for powertrains, the German firm has spoken before of wanting to lower development costs, especially in the area of small engine development which could help it with its numerous small car initiatives.

[Source: Automotive News – sub. req'd.]

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