Toyota will share hybrid technology with its Chinese partners in a bid to cut costs and stimulate demand for hybrids in pollution choked China, the company said.

Batteries and hybrid motors are made in Japan and shipped to China where Toyota assembles hybrid cars in joint ventures with First Automobile Works and Guangzhou Automobile Group. But it has always been reluctant to share its hybrid technology with partners for fear of losing its competitive advantage.

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The problem with shipping in parts from Japan has been that it has pushed up the price of its Prius hybrid, sales of which have remained slow in China.

Toyota said it wants to have a China built hybrid tailored for local customers ready within two years.

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