Daimler and BMW to merge?

A year ago it would have been considered a sign of the apocalypse, but given the way the automotive industry landscape has changed in the last six months it now seems like common sense.

German archrivals Daimler (owners of Mercedes-Benz) and BMW are reportedly in discussion about a future together. German newspaper Des Spiegel has reported the two companies have been considering a component and parts sharing arrangement since late last year but it has now emerged part of the deal would mean each will take a financial stake in the other.

The newspaper is reporting that if the two agreed to the deal they would swap as much as seven per cent of their respective ownerships.

Although it is believed there is resolve from both sides of the fence, the Quandt family (which owns 46 per cent of BMW) is rumoured to be uncomfortable with the prospect of tying up with their marketplace rivals.

The Quandt's are apparently uneasy because of Daimler's merger with Chrysler quickly turned into a full-blown takeover. It's reported they are worried about a repeat.

Should the deal go ahead it is expected the union would expand to other areas other than component and parts sharing, with co-development of future models on the cards. The next generation MINI Cooper and Mercedes A and B-Class could share the same platform and new front-wheel-drive powertrains could also be shared between the two.

Both brands are hurting in the market, with Audi - part of the Porsche-owned Volkswagen Group - continuing to gain ground globally after years of lagging in a distant third-place in the luxury segment.