We learned some time ago that Toyota and Mazda were up to something with the announcement that Mazda’s recently-completed Mexican plant would produce a Toyota-branded vehicle for North America. We now know that car is the unabashedly Mazda2-based Scion iA, whose March 2015 unveiling at the New York auto show came just weeks after Mazda pushed back the 2’s summer 2015 launch to sometime next year.

So there’s that, but now we know more about what the two Japanese brands are up to: in a statement released today, Mazda and Toyota say they are working on a “long-term partnership” that will see them share technologies designed to help consumers cut fuel consumption as the automakers cut R&D costs.

Nothing has been formalized yet, but the agreement-in-principle looks like this: Mazda will get to use Toyota’s hydrogen fuel cell and plug-in hybrid technology, while Toyota will gain access to Mazda’s Skyactiv gas and diesel engine tech. It’s a smart move on the part of both companies: Mazda’s Skyactiv motors prove that internal combustion can be both thrifty and engaging to drive, while Toyota has nailed the hybrid-drive thing better than any other automaker on the planet.

Mazda, a small company next to Japanese juggernauts like Toyota and Honda, says it’s not looking for another deal like it had with Ford, where the American company assumed part-ownership of Mazda; instead, this latest arrangement will benefit Mazda by freeing up funds to allow the continued development of its next-gen combustion engine technology, which will still burn gasoline, but in a diesel-like fashion that eliminates the need for spark plugs. Called homogeneous charge compression ignition (HCCI), it could further cut fuel consumption by up to 30 percent compared to Mazda’s current Skyactiv motors; the company is aiming to bring HCCI to market by the year 2020.

In an interview with Automotive News, Toyota CEO Akio Toyoda wouldn’t give a timeline for future joint projects, declaring today’s announcement “an engagement, not a marriage.”

2016 scion ia 002

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