BMW to Tie Up with Toyota, Break Up with PSA?

BMW AG and Toyota Motor Corp. will add several unspecified new projects to their existing collaboration on diesel engines and battery research, Der Spiegel reports, without citing its sources.

BMW agreed last December to begin supplying 1.6- and 2.0-liter "clean" diesel engines to Toyota in 2014. The companies also are cooperating on next-generation lithium-ion batteries for hybrid and electric vehicles.

BMW CEO Norbert Reithofer and Toyota President Akio Toyoda will soon announce the new plans, according to the German newspaper. It notes that Toyota could benefit from BMW's expertise with lightweight materials.

The Nikkei, which cites no sources, adds that Toyota will provide hybrid systems and fuel cell technology to BMW.

Separately, BMW and PSA disclosed last week that they are re-evaluating their 50:50 joint venture to make hybrid vehicle components because of the French company's tie-up with General Motors Co. GM and PSA agreed in February to share vehicle platforms, components and purchasing.

BMW says it might acquire PSA's half of the two-year-old partnership. But the German carmaker which says it has made a larger investment in the hybrid venture tells Reuters it would not "make any payments" to PSA in exchange for the stake.