With so many new U.S tariffs being introduced, how will Toyota and Lexus be affected?
Toyota is shifting gears to combat the sales decline it has experienced in the Chinese market by announcing the establishment of a new electric vehicle (EV) company in Shanghai. This move marks a strategic step for Toyota as it intensifies efforts to reclaim its position in one of the world’s most important automotive markets.
Not too long ago, Toyota China made an official announcement that Toyota Motor Corporation and the Shanghai government have reached an agreement to set up a new EV and battery research and development (R&D) and production company in the Jinshan District, located in the suburbs of Shanghai.
Moreover, this facility will focus on the production of pure EVs under Toyota’s premium brand, Lexus, with an expected production start in 2027. This collaboration represents a significant milestone for Lexus, as it will be the first time the brand has owned a production facility in China.
It also marks a notable achievement for the Japanese automaker as it follows in the footsteps of American giant Tesla, becoming the second foreign auto brand to wholly invest in the production of pure EVs in Shanghai. The new company will be dedicated to developing Lexus-branded electric models specifically tailored to meet the needs and preferences of Chinese consumers, a key factor in Toyota’s bid to reignite its presence in the market.
On top of that, this move comes in response to the recent decline in Toyota’s sales figures. In 2024, Toyota’s global sales totaled 10.8 million units, which represents a 3.7 percent decrease compared to the previous year.
Even more concerning for the brand is the decline in the Chinese market, where Toyota sold 1.8 million vehicles in 2024, marking a 6.9 percent drop from the same period in 2023. By focusing on EVs, Toyota is positioning itself for the future of the automotive industry, especially in China, where the demand for EVs has surged.
As part of its long-term strategy, the new EV plant will help Toyota recover from its recent losses and tap into the growing market for luxury EV in China. With the 2027 production goal in sight, Toyota’s commitment to electric mobility will play a pivotal role in reshaping its future in China, aligning with the country’s push for cleaner, greener technologies.
We got all this from Shine and their full article is linked here. Thank you Shine for the information and images.
