Japanese carmaker Toyota and Germany's BMW have announced they are to work on green engine technology together. They will carry out research on the next generation of environmentally friendly batteries. As part of the new deal, BMW will also supply 1.6 and 2 litre diesel engines to Toyota. The two firms are also in discussions about working together on other collaborative projects.

Toyota said that because of the deal it was planning to sell more fuel efficient, diesel vehicles in Europe.

Both Toyota and BMW are huge players in the the Japanese and German automotive industries, and together would make a formidable force. But this isn't the first time a pair of German and a Japanese car firms have attempted to combine resources. A similar deal between Suzuki and Volkswagen was set up some time ago, but has subsequently encountered serious issues; Suzuki is currently in the process of trying to extract itself from the partnership.

Time will tell if the significant resources behind both these firms will increase the firms' market share. Toyota is already the world's number one car maker, with GM and Volkswagen hot on its heels.

With the high cost of motoring, moves such as this may well become more common in the future, especially if it accelerates the process of designing more efficient engines. For those seeking to reduce the financial burden of running a car, investing in more fuel efficient cars is an effective solution - that as well as driving economically and finding good deals on insurance - and of course breakdown cover, whether it be annual cover for the UK or other policies such as short term European cover.