Toyota Motor couldn’t have picked a more logical place than China to build and sell its petrol-electric vehicle as the country is home to 16 of the 20 cities in the world with the worst air quality, Forbes magazine said.

Toyota announced on Wednesday that it will begin building and selling the Prius in China late next year.

“Our overall corporate philosophy is to try spread our hybrid technology around the world,” Dennis Cuneo, a senior vice president with Toyota Motor North America, told Forbes.

The magazine said China is a good candidate because its huge cities, already choked with pollution, are getting bigger as its industrial growth spurt continues while vehicles sales, which will add to that pollution, are keeping pace. Sales in China topped 4 million units last year, almost double the 2.1 million sold in 2001, Forbes said, citing forecaster Global Insight.

Forbes noted that, in 2003, China passed Japan as the second-largest petroleum consumer in the world (following the United States), and China’s booming demand is one of the factors causing oil prices to rise worldwide.

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The report said that the Prius is the car China needs, but it may not be the car China wants because hybrids are more expensive to build and is fairly expensive for its size and comfort level.

The things that are driving the Chinese car market are cheap, quality cars that the emerging middle class can get their hands on, and luxury cars that the growing number of Chinese rich are snapping up, Forbes noted.

The report said Toyota will sell what Cuneo says is a “modest number,” fewer than 10,000 while its manufacturing commitment is similarly modest–it will send partially assembled kits to China for final assembly there. None of the Chinese-built vehicles, Toyota says, will be for export, Forbes added.

Rebecca Lindland, a Global Insight analyst, told Forbes it is strategically smart for Toyota to put hybrid technology into the Chinese market as it is still maturing. “If it is introduced now it can become part of the automotive culture there,” Lindland reportedly said. “The acceptance level will be much higher than if it were introduced later.”