Toyota Motor plans to produce electric vehicles in China from 2019, according to reports in Japan citing unnamed sources.
A battery powered model based on the C-HR crossover is being considered for sale only in China. Initial output volume would likely amount to just "several thousand" units a year even though the market is expected to expand rapidly in the next few years.
The Chinese government has set ambitious targets for electric vehicle sales to reach 2m units a year by 2020 and 3m by 2025, driven by a strict quota system.
The government hopes higher production of lithium based batteries will help reduce the cost of electric vehicles while additional incentives will likely heighten buyer interest.
Toyota confirmed it plans to introduce electric vehicles in China "in the next few years" but would not detail models.
It sold 573,890 vehicles in China in the first half of 2017, up by almost 9% year on year.