BMW is this week expected to announce details of a deal under which it will buy Toyota diesel engines for the British-made Mini, the Financial Times (FT) said.

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The newspaper said the two companies have signed production and development contracts following over a year of talks, and added that it understood Toyota would sell about 15,000 engines a year to BMW, to be shipped initially from Japan to the Mini factory in Oxford, England.


The FT said BMW would buy diesel engines used in Toyota’s Yaris compact hatchback (known in some markets as the Vitz or Echo), some of which are assembled in France. Toyota is expected to begin diesel engine production in France in 2003-04, the newspaper added.


The FT also said that BMW’s confirmation of the Toyota engine deal is expected to coincide with an announcement of a boost in Mini output in England to at least 125,000 vehicles this year.


Part of the reason is higher than expected demand in the US, the FT said.

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