Rumours that Toyota and Ford may be in co-operation talks sent shares rising at the end of December, although neither company has clarified the position.

The two companies have confirmed that Toyota chairman Fujio Cho met recently with Ford Motor president and chief executive officer Alan Mulally in Tokyo. Investors jumped to the conclusion that a potential alliance might be on the cards, but the companies have played down any such speculation.

Ford said in a statement that "We meet regularly with other automakers on a variety of topics of mutual interest." 

A Toyota statement said, "Members of Toyota top management meet with top executives of other car manufacturers when such opportunities arise, such as Toyota chairman Cho recently exchanging greetings with Ford Motor CEO Alan Mulally."

According to the Associated Press (AP) the alliance is likely to focus on environmental technologies. It quotes automotive analysts who suggest that Ford is after Toyota's hybrid technology.

"Remember, it was Ford that came to Toyota," Shinko Securities senior analyst Shinji Kitayama told AP. "Toyota probably doesn't feel it has anything in particular to gain from closer ties with Ford but, for Ford, Toyota's green technology is attractive."

Toyota already licenses some environmental technologies to Ford, according to AP, including several of its hybrid system and emissions purification patents for use in Ford's own hybrid system.

"US automakers have been behind their Japanese counterparts in environmental technology," said Shinya Naruse, an analyst with Nomura Securities. "They recognise that they will need to do more in the future and it may even be necessary for continued growth."