Lexus, Toyota’s luxury brand, has officially begun construction of its first wholly-owned electric vehicle factory in China, as the Japanese automaker moves to expand its footprint in the world’s largest EV market. The new plant, located in Shanghai’s Jinshan district, is expected to begin production in 2027 with an annual capacity of up to 100,000 vehicles.
The project marks a strategic shift for Toyota, aiming to enhance its position in China’s rapidly evolving automotive sector and to better compete with domestic EV manufacturers. The facility is scheduled for completion by August 2026 and will initially create approximately 1,000 jobs, according to local government sources.
“Toyota aims to leverage the project to accelerate its transition toward electrification and smart cars, launching EVs tailored for both the Chinese domestic and international markets,” reported local media outlet The Paper.
Lexus becomes only the second foreign automaker after Tesla to establish a fully-owned manufacturing facility in China, following Beijing’s move to eliminate foreign ownership limits in the electric vehicle segment. Prior to the policy change, international automakers were required to operate through joint ventures with Chinese firms.
The Shanghai plant will produce Lexus-branded battery-electric vehicles, with the first model scheduled to roll off the line in 2027. In preparation, the company secured a 1.13 million-square-metre plot of industrial land in April for RMB 1.353 billion (€174 million), designated for NEV manufacturing and battery production.
Toyota’s performance in China’s EV sector has lagged behind rivals, prompting a strategic overhaul that includes sourcing key components such as BYD’s Blade battery and electric motors for its bZ3 saloon. The company has also launched the bZ3C and bZ3X through partnerships with FAW and GAC, respectively.
Source: carnewschina.com