Dec 24 (V7N) - Toyota intends to build an electric vehicle (EV) factory in Shanghai dedicated to its luxury Lexus brand, targeting operational readiness by 2027, according to media reports. This would mark the first Japanese-owned vehicle factory in China operating without a local partner, Japan's Nikkei business daily said.

Although Toyota has not confirmed the plan, the move appears aimed at strengthening its foothold in China's competitive EV market, where foreign automakers face mounting challenges. Public broadcaster NHK highlighted that Toyota's new plant reflects efforts to catch up in a market dominated by Chinese EV manufacturers.

Japan's automakers have struggled in the rapidly growing EV sector, focusing instead on hybrid vehicles. Toyota's rivals, Honda and Nissan, recently announced plans to explore a merger to bolster their EV and self-driving technology efforts, signaling intensified competition within the industry.

Toyota's Shanghai factory would reportedly focus on producing Lexus models, as the brand's vehicles in China are primarily imported from Japan. By manufacturing locally, Toyota aims to enhance competitiveness and meet rising demand for premium EVs.

China remains pivotal as the world's largest EV market and vehicle exporter, surpassing Japan last year, underscoring the urgency for Japanese automakers to adapt to shifting market dynamics.

END/BUS/RH