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Toyota has already hooked up with Aston Martin on one small car project and it looks as though the Japanese automaker could be looking to forge more partnership with European automakers. According to the latest reports out of Germany, Toyota is considering an alliance Daimler.

Per a new auto motor und sport report, Toyota has entered into talks with Daimler - the parent company of Mercedes-Benz - about a potential partnership. The tie-up would reportedly see Toyota producing its own versions of Mercedes' A- and B-Class vehicles on its MC platform and could even include the co-development of the automakers' flagship models - the Lexus LS and Mercedes-Benz S-Class.

"It's part of our normal business practice that we regularly talk to other carmakers but there are no specific projects planned at the moment," a spokeswoman for Toyota Motor Europe told Automotive News.

The potential partnership could give Lexus a better foothold in the European market. Although Lexus has been the number one selling luxury marque in the U.S. for several years, it has struggled to gain any kind sales success in Europe. With Mercedes as a partner, Lexus could finally land some much needed clout with European buyers.