Arch-rivals BMW and Daimler are still locked in talks with latest discussions surrounding topics on component sharing and joint-research of new powertrain technologies. Daimler CEO Dieter Zetsche has confirmed the two carmakers are in fact discussing the potential for component sharing, alluding to the fact new emissions laws are forcing manufacturers to develop expensive new technologies to help reduce emissions and fuel consumption levels.

When announcing the discussions between BMW and Daimler, Zetsche also stated that in the future Daimler may even consider exporting cars from its Chinese plants to combat the rising production costs in Western markets. This is most likely dependent on whether the quality of Chinese manufacturing improves, and Zetsche was careful not to rule out any export opportunities, reports the Detroit Free Press.

While collusion in technology development makes sense for the two German giants, discussions of component sharing are a little surprising considering the two carmakers hold the largest market share in the luxury car market and could possibly compromise this by losing their respective identities.

This is not the first time Daimler and BMW have been in talks. They met previously to talk about the possible sale of BMW engines to Daimler, Fiat and GM. While BMW's most prized engines wouldn't be on the table, some of its more ubiquitous offerings may become part of its plan to increase revenue streams in a time of slowing sales growth. BMW is expected to have come to a decision by the end of the year.