Toyota Motor Corp. and FAW Group Corp., China’s largest automaker, signed an agreement Wednesday to jointly manufacture four Toyota models in China to cash in on the world’s fastest growing auto market.
The project follows a basic agreement on a comprehensive alliance signed by the carmakers in August. The agreement calls for selling between 300,000 units and 400,000 units by 2010.
The four models are the Crown luxury sedan, the Corolla compact, the Land Cruiser and the Land Cruiser Prado sport utility.
Production of the two SUVs will start by the end of this year, while the Corolla will be rolled out next spring and the Crown a year later.
Japanese carmakers claimed a 1.5 percent share of the 3.38 million-unit Chinese market last year.
“China is one of the most important markets for Toyota, so we will reinforce our business there to wrench a 10 percent market share by 2010,” said Toyota President Fujio Cho.
Toyota and FAW Group plan to annually produce 50,000 units of the Crown and 30,000 units of the Corolla, both at plants operated by Tianjin Toyota Motor Co., a joint venture equally owned by the firms.
Ten thousand units of the Land Cruiser will be made at a FAW Group plant in Chang Chun and 5,000 units of the Prado at a plant run by Sichuan Toyota Motor Co.
In the first joint project with the FAW Group, Toyota started producing the Vios compact last year; it plans to produce more than 50,000 units annually.
Including the latest deal, total production volume will reach 100,000 units in 2004 and 150,000 units in 2005.
“The partnership with Toyota can create a win-win situation in the growing Chinese market and will last for the long term,” FAW Group President Zhu Yanfeng said.
While the Chinese firm has formed alliances with Toyota and German carmaker Volkswagen, it has no plan to enter tieups with other carmakers, he said.
The presidents of Toyota and FAW Group suggested they may cooperate to make commercial vehicles in China in the future.
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