Japanese automakers Toyota and Mazda are considering a comprehensive tie-up in environmentally-friendly technology amid tightening regulations to cut greenhouse gas and tough emerging market competition, a report said Saturday.

The two companies are in the final stages of talks on the planned partnership, the Nikkei business daily said, adding that the two "intend to reach an accord in principle soon".

Under the partnership, Toyota plans to supply fuel cell and plug-in-hybrid technology to Mazda, which has lagged in electric-vehicle technology, the newspaper said.

In return, Mazda will consider offering its proprietary "Skyactiv" green technology to Toyota, which it hopes to use to grow its line of fuel-efficient gasoline and diesel vehicles.

The two automakers will also consider cooperating in other areas, including Mazda's procurement of commercial vehicles from the Toyota group and joint purchasing of auto parts, it added.

The two firms have previously worked together in several fields and achieved some positive results.

Toyota provided hybrid-vehicle technology to Mazda in 2010, while Mazda agreed in 2012 to supply subcompact cars from a Mexican plant to Toyota.

The latest alliance is part of an effort to jointly address strict global environmental rules, the Nikkei said.

In 2018 environmentally-conscious California plans to push automakers to boost sales volume for electric and fuel cell vehicles, while China and other emerging economies are also set to strengthen environmental regulations.
Source: AFP