On Monday, the Japanese business daily, Nikkei, reported that Toyota and BMW are further strengthening their green technology alliance.

Nikkei, and the German magazine Der Spiegel said that the CEOs of each automaker, Akio Toyoda and Norbert Reithofer, plan to hold a news conference later this week regarding the matter, though Nikkei didn’t say where it received the information.

So far, neither Toyota nor BMW has released any official information on the subject.

That, said it appears to be a logical step, following on from the news last December that both automakers were forging a “green” alliance. Back then BMW was to supply Toyota with small displacement diesel engines for use in Europe, while Toyota and BMW would work on lithium ion battery technology for future vehicle programs.

BMW had been planning closer ties with PSA Peugeot-Citroen, for the development of hybrid technology, though the struggling automaker appears to getting cozy with General Motors, making the very notion of a PSA BMW alliance unlikely.

If successful, the deal could witness significant manufacturing cost reductions in Toyota’s Hybrid Synergy Drive system, which would likely make hybrids from the Japanese manufacturer more affordable across the board. Supplying BMW with the technology would also provide Toyota with added prestige.

The alliance is just one of a number of closer cooperation strategies being forged by automakers around the world; besides the GM-PSA arrangement; Mercedes-Benz and Nissan are also working together on future technology vehicle programs.

The need for such alliances is largely being driven by political pressure to further reduce vehicle emissions and boost fuel economy, requiring automakers to share the financial burden of R&D and development in meeting these stringent requirements.