Toyota is expanding its efforts in the Chinese market with plans to increase its annual vehicle production to up to 3 million units, as the Japanese automaker seeks to reclaim market share lost to fast-growing domestic competitors like BYD. Sources familiar with the matter told Reuters that Toyota intends to scale up its China production by the end of the decade, a move reflecting the brand’s acknowledgment of its current challenges in the highly competitive Chinese auto market.
Toyota’s target would represent a significant increase from the 1.75 million vehicles produced in China last year and a 63% jump from 2022’s record 1.84 million. While specific targets have not been formally set, insiders revealed that the company has communicated its production expansion plans to some suppliers.
In an effort to enhance efficiency, Toyota plans to streamline operations between its two Chinese joint ventures and allow local teams more authority in development, aiming to better align with consumer preferences in China. Additionally, Toyota is considering consolidating production across its joint ventures under a single system, which would unify distribution while retaining separate dealership channels.
Acknowledging the intense competition, Toyota stated, “With the intense competition in the Chinese market, we are constantly considering various initiatives,” without offering further specifics. The company has also introduced localized models like the bZ3C electric sedan, developed for the Chinese market and featuring BYD’s FinDreams lithium-iron-phosphate battery for extended range.
Toyota’s approach mirrors the challenges faced by other foreign automakers in China. Legacy brands such as Honda and Nissan have scaled back production, and Mitsubishi has exited the market entirely. Meanwhile, domestic brands like BYD are attracting consumers with cost-effective, competitive models designed specifically for local tastes.
Source: Reuters
