Toyota Motor Corp. has developed a fuel-efficient diesel engine, jointly with affiliates Dense Corp. and Toyoda Automatic Loom Works Ltd., primarily for automobiles produced in Europe, company officials said. Automobiles powered by the new engines will go on sale next year at the earliest. The direct-injection engines will be mounted on Avensis midsize sedans built in the U.K. and Yaris compacts to be produced from 2001 at Toyota's new French plant.