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Mini to source D-4D diesel from Toyota

BMW is to launch a Mini diesel variant in 2003 after securing a deal with Toyota to source between 10,000 to 20,000 engines a year. Toyota will supply the 1.4-litre D-4D unit used in the Yaris to the Mini plant at Oxford, where engineers will modify it for performance and fit. Production at the plant is likely to increase by 25 per cent, from 100,000 to 125,000 vehicles a year, to handle the new variant.

The contract, agreed for an unspecified period, was announced at BMW's annual meeting last week, which also confirmed former chief financial officer Helmut Panke as chairman, replacing the retiring Joachim Milberg.

Both believe that engine and assembly alliances with other suppliers is a cost effective way to expand model variants. BMW is, however, thought to be developing its own small diesel option ready for the launch of the 1-series in 2004, which could then be used in the Mini.

“It is important that Mini is represented in the growing market for small diesel cars,” says Trevor Houghton-Berry, Mini UK general manager. “We will ensure that the diesel Mini will be the most desirable small car in its field.”

Diesel sales in the UK have risen from 16 per cent of the new car market in 1997 to 23.2 per cent last month. The deal will strengthen Toyota's status as the world's third largest carmaker after General Motors and Ford. Full-year net profits rose 30 per cent year-on-year in 2001, buoyed by strong sales in the US and its home Japanese market. Earnings increased from £2.53bn in 2000 to £3.3bn last year on turnover up 12 per cent to a record £80.6bn.

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