China's BYD Auto Industry and Toyota's Japanese heavy truck unit, Hino Motors, have signed a joint venture agreement to set up a new company for commercial battery electric vehicle (BEV) development.

The new JV is scheduled to be established "within China" in 2021 with BYD and Hino each taking a 50% stake.

"[The JV would combine the strengths of both companies to develop BEVs and electric units and will aim to quickly implement the ideal products for customer needs, primarily in the Asian market, the two automakers said in a statement.

The venture plans to launch vehicles, initially under the Hino brand, in the first half of the 2020s. 

"BYD and Hino will work together to develop and spread the best fit commercial BEVs for customers to achieve low-carbon societies," the statement added.

Earlier this month, Toyota Motor said it planned to develop a hydrogen fuel cell powered heavy duty truck for North America in partnership with Hino.

The automaker said it would make available its fuel cell technology for the project which will be applied initially to Hino's XL series Class 8 truck chassis.

A prototype was expected to be developed in the first half of 2021 but a timeline for commercialisation was not released.