Leading motor manufacturers, General Motors and Honda have inked an agreement to explore sharing vehicle underpinnings and propulsion systems in North America. Both the vehicle manufacturers are holding discussions on jointly designing vehicles and it would include vehicles powered by both electricity and internal combustion engines. Engineering work will start early next year.

Honda and General Motors in their media statement said that they’ll cooperate on purchasing research and connected devices. The development is a sign of market consolidation in the automotive business as companies are facing huge capital outlays to develop products including new electric and autonomous vehicles.