Toyota is planning to increase its vehicle production in China, targeting at least 2.5 million units annually by 2030, reported Reuters.
This move is designed to integrate its sales and manufacturing operations more closely and grant local executives’ greater autonomy in development.
The initiative marks a considerable shift for the leading automaker, as it seeks to reclaim market share from local competitors like BYD, the report said.
Toyota's approach diverges from other global automakers, some of whom are reducing their presence in China, the world's largest car market.
It aims to ramp up production to nearly three million vehicles annually by the decade's end.
This target marks a 63% increase from the record 1.84 million vehicles produced in China in 2022, up from 1.75 million the previous year.
The company has communicated its plans to some suppliers to ensure a strong supply chain by affirming its commitment to the Chinese market.
In response to questions from Reuters, Toyota in a statement said: "With the intense competition in the Chinese market, we are constantly considering various initiatives". It said it would continue to work on making "ever-better cars" for the Chinese market.
Toyota is set to streamline its Chinese joint ventures' sales and production operations to enhance efficiency.
Furthermore, it plans to delegate more development responsibilities to China-based staff, who possess a deeper understanding of local preferences, especially in electrified and connected car technologies.
The shift towards leveraging local expertise in China is part of Toyota's strategy to quicken product development in the face of intense competition from domestic electric vehicle (EV) manufacturers.
Toyota is looking to improve collaboration between its research and development centre in Jiangsu and its local joint ventures.
This is in response to the observation that vehicles developed by partners such as FAW Group's Hongqi and GAC Group's Aion are outperforming those made with Toyota.
To optimise operations, Toyota will centralise the production of "twinned vehicles" at single joint ventures while distributing them through both JV dealerships.
The competitive landscape has also affected Japanese parts suppliers and has led to a decrease in Toyota's operating income in China due to heightened marketing expenses.
