Nissan and Honda, both slow to roll out electric vehicles, are looking to partner on the areas of electric vehicles and software to help speed up development and lower costs.

The automakers on Friday announced the signing of a memorandum of understanding for the start of a feasibility study exploring the potential partnership.

The scope of the study covers software platforms, core EV components, and other related products, the automakers said in a joint statement.

Citing sources at Nissan, Nikkei reported on Thursday that Nissan and Honda are looking to jointly work on vehicle development as well as procurement.

According to the sources, the primary goal is to reduce costs to help the automakers compete with cheaper EVs being launched by Chinese brands. China’s EV leadership helped the country overtake Japan last year to become the world’s largest exporter of vehicles.

Honda already formed a partnership with General Motors to accelerate the development of EVs for North America. The partnership has resulted in the 2024 Acura ZDX and 2024 Honda Prologue SUVs which start sales later this year. Honda has also joined forces with Sony to establish the global EV brand Afeela which will launch its first vehicle in North America in 2026.

Nissan is part of an alliance with Renault and Mitsubishi, though neither of those brands have a strong footing in the key markets of the U.S. and China, where Nissan stands to benefit most from launching EVs.

Another option for Nissan may be a partnership with cash-strapped EV startup Fisker. Reuters earlier this month reported that Nissan is in talks with Fisker about an investment to gain access to the platform of Fisker’s planned Alaska pickup truck. According to Reuters’ sources, Nissan may even built the Alaska for Fisker. Neither automaker has confirmed the talks though Fisker has said it is in talks with a major automaker.

Update: This article has been updated to include Nissan and Honda’s confirmation of their talks about a potential partnership.