Toyota plans to increase production capacity in China by 20%

by Denis Gurskiy

As the Chinese govenrment provides incentives to foreign automakers for making green cars within its borders, efforts continue to grow to build cars within China. A source from Toyota reports that the Japanese company will expand its efforts in China.

According to the source Toyota plans to beef up its production capacity in its Tianjin city factory by 120,000 vehicles a year. 10,000 of these additional cars will be all-electric while 110,000 will be plug-in hybrid. This being Toyota, I can’t say I’m surprised by the ratio of BEV to PHEV in the production numbers. The source did not state how much the expansion would cost, but according to a government website the project will cost around $257 million.

Along with the Tianjin factory, Toyota will also increase capacity in its Guangzhou factory by 120,000 vehicles a year as well. We don’t know the breakdown of the which cars the increased capacity will be used for but the source says that “Toyota’s planned additional capacity in Guangzhou is also for electrified vehicles”. More than likely it will follow the same ratio as the Tianjin factory.

All in all, this 240,000 vehicle a year increase in production is a substantial 20% increase in capacity for China. Toyota currently produces 1.16 million vehicles a year in China.

These planned expansions of their Guangzhou and Tianjin factories are part of Toyota’s strategy to eventually sell 2 million cars a year in China by the early 2020s. This represents a jump of over 50 percent and these expansions are a sign that Toyota is taking the region more seriously. Look forward to Toyota possibly starting construction of one or two more factories within China to help them get to those numbers.

Indeed it is a shame to us that Toyota is still stubborn about building full battery electric cars, only planning to increase production by 10,000 cars a year. Many automakers is testing out their new EVs in China before release to the rest of the world due to the government policies in place. Perhaps, with more production room in China, Toyota will start to test fully electric vehicles in China before releasing them to the rest of the world. Wishful thinking on my part maybe.

What do you guys think? Let us know down in the comments below.

Source: Reuters

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