Toyota Motor Corporation's (TMC) GAC Toyota Engine (GTE), a joint venture with Guangzhou Automobile Group (GAC), began production in October of a new four-cylinder, in-line AR engine at its plant in Nansha, China, the automakers announced.

The AR comes in 2.5-, 2.7-litre and 2.5-litre hybrid versions, with the 2.5 to be used in the redesigned Camry soon to begin local production in China.

GTE spent US$96m preparing the plant for the new motor.

GTE was established in 2004 to make engines and engine parts.

TMC policy is to produce where its products are sold.

"The decision was made to produce AR engines in China to meet the anticipated strong demand for vehicles that comply with increasingly strict fuel efficiency and emissions regulations," the automaker said.