It looks like BMW and Toyota are taking things even closer in terms of working together – the two companies are set to forge even deeper ties in the development of fuel-efficient vehicles.

According to the Nikkei, Toyota will provide hybrid systems and fuel cell technology to BMW, with Toyota president Akio Toyoda and BMW chief executive officer Norbert Reithofer set to make an announcement on the matter sometime this week.

The broadening of the partnership expands on the agreement reached by both companies last year to pursue joint research on next-gen lithium-ion batteries. The companies also have inked a deal in which BMW will supply Toyota’s European division with its 1.6 and 2.0 litre diesel powerplants beginning 2014.

The Japanese automaker is keen to collaborate with other manufacturers to widen the reach of hybrid systems – last year it agreed on joint development with Ford, and it is also providing hybrid technologies to Mazda. This is the first time, however, that Toyota will supply its fuel cell technology, which uses hydrogen to power a vehicle, to a rival, the report adds. It already has plans to roll out a fuel cell model by 2015.

On other levels, the automakers will also share expertise on developing strong, light materials, including plastic, as well as efficient processing technologies. In related news coming in from Europe, BMW is leaning toward reviewing its partnership with the PSA Peugeot Citroen group in terms of hybrid technologies.