Toyota Motor and BMW are stepping up collaboration on fuel cell vehicles. The Japanese carmaker is supplying key components to its German counterpart.

The automotive powerhouses first formed the ties in 2012 and have been co-developing hydrogen tanks, motors and other basic systems for fuel-cell vehicles.

Sources say joint efforts are expanding, and that Toyota will supply important parts such as tanks and fuel cells to BMW.

The German automaker is developing a fuel-cell vehicle and testing it in Japan and elsewhere. BMW aims to launch a mass-produced model that will include components from Toyota.

The two automakers plan to sign a basic agreement and announce the deal in early September.

Fuel-cell vehicles are also known as FCVs and use hydrogen to generate electricity. They do not emit carbon dioxide while in motion. Automakers are developing these as an environment-friendly option to plug-in and hybrid electric vehicles.

FCVs have long cruising distances like gasoline-powered cars, and take only a short time to replenish hydrogen. But they are expensive relative to other types of vehicles.

The two automakers are apparently looking to lower the production cost through a stronger collaboration, in a bid to promote FCVs.