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 |  Dec 01 2011, 8:00 PM

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At the Tokyo Motor Show this year, BMW and Toyota agreed to a mid- to long-term collaboration on next-generation, environmental-technology projects. The two manufacturers will jointly develop lithium-ion batteries while BMW will also supply Toyota with diesel engines for their European vehicles.

It’ll actually be very interesting to see some of Japan’s and Europe’s greatest automotive minds working together towards next-generation technology. The results could be groundbreaking if the cooperation is effective and not just simply engine-trading across vehicles.

Starting in 2014, BMW will be supplying Toyota with 1.6L and 2.0L diesel powerplants for Toyota’s European-market vehicles. This shows a change of heart for Toyota, who originally wanted to continue pushing hybrids in Europe, but has realized that the market still prefers diesel-powered vehicles.

In a previous agreement, Toyota had supplied BMW with 1.6L diesel powerplants for their MINI products between 2002 and 2005. But at the end of the day, we’re definitely more interested to see what these two brands can come up with in terms of electric and hybrid technologies – especially with BMW’s new i-models coming out.