BMW and Mercedes-Benz could jointly develop the next generations of their compact cars — the BMW 1 series and the Mercedes A-class family — as part of a wider cooperation that would also include sharing technology for autonomous cars, a German newspaper reported.

The two automakers need to rein in costs so they can afford to invest billions in self-driving systems to avoid losing their technological edge to traditional rivals and newcomers such as Waymo, Handelsblatt said.

Sharing a compact-car architecture would save the two automakers billions in investment costs, the paper reported, quoting insiders with knowledge of the discussions.

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BMW And Mercedes Consider Sharing Future Small Car Platform

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