Toyota to boost production capacity in China in 2015

Opens new R&D subsidiary for HV/EV technology

2013/09/24

Summary

 Toyota Motor Corp. (TMC) announced its new China market strategy, "Toyota Yundong Plan: China Vision" in March 2012, which revealed its business management policy for China to promote integrated localization from planning, development through production. Higher localization should enable the company to quickly respond to changes in the environment, including the government's policy revisions, local customer and market needs. It should also facilitate development of competitive products, especially costwise. Around 2015, Toyota plans to begin manufacturing hybrid passenger cars equipped with locally developed and produced hybrid components. Through introduction of these highly competitive models, Toyota aims to win and expand the market share in China.

Resonanceコンセプト
An Electric Vehicle (EV) Concept, which will be a base model for the Ranz. This model is expected to start production at a FAW-Toyota JV plant as the JV's original brand around 2015.
(Photo:at the Shanghai Motor Show in April 2013
Versa Noteハッチバック
An EV concept, which will be a base for the model to be produced by GAC Toyota in China around 2015 (The model name is yet to be announced.)
(Photo:at the Shanghai Motor Show in April 2013

Related Reports:
  Shanghai Motor Show 2013 (4): Eight major Japanese OEMs, Hyundai, and Qoros (Jun. 2013)
  Chinese OEM sales outlook 2013 (Mar. 2013)
  Toyota: Sales expansion planned for North America and Asia (Mar. 2013)



Toyota's production/development strategies in China

Specifics
Business policy * To conform to the Chinese government's new and revised policies as well as to focus constantly on the needs of local customers.
  Toyota will realize the "genuine local production" and promote energy-saving/new-energy vehicles (i.e. green vehicles). It aims to become an automaker with the most powerful product lineups including the global-best new-energy vehicle lineup.

* To provide next-generation eco cars, starting with hybrid vehicles (HV) to be followed by other new-energy vehicles including plug-in hybrids (PHV) and electric vehicles (EV), which all share the core basic technologies such as motors, secondary batteries and electronic control systems.

* To accelerate and strengthen localization of the business management systems in China.
Social Contribution/
Responsibility
* In addition to precedent efforts to promote human resource development and the non-profit reforestation program, Toyota will further invest in non-profit activities and strengthen management in such activities in order to show its gratitude toward the Chinese society and to contribute to its sustainable development.
  Note: Toyota Motor (China) Investment Co., Ltd. (TMCI), Toyota's subsidiary responsible for its businesses in China, formed an exclusive department, "Shehui Gongxian Bu" called in Chinese, to manage CSR (corporate social responsibility) activities in China prior to April 2012.
Production volume targets * For 2013:
  Production volume is to meet its sales target for 2013, a year-over-year increase of 7.1% to over 900,000 units.
  However, the sales targets announced by Toyota's affiliates in China total 950,000 to 970,000 vehicles. (Breakdown: FAW Toyota Motor Sales Co., Ltd. (FTMS) 580,000 to 600,000 units, GAC Toyota Motor Co., Ltd. 290,000 units and Lexus China 80,000 units)
* For 2015:
  The production volume is to meet the estimated sales target around 1.35 million units including import.
  The target for complete vehicle sales in China will account for about 15% of Toyota's global sales target, according to interviews with Toyota's Chinese subsidiary executives in October 2012 and February 2013. Toyota's global sales target for 2015 is announced as nine million units. (10 million units including Daihatsu and Hino)
2015 sales target breakdown:
  The target estimated by MarkLines Co., Ltd. is around 750,000 units by FAW Toyota Motor Sales Co., Ltd., and it will be produced by Tianjin FAW Toyota Motors Co., Ltd. (TFTM) and Sichuan FAW Toyota Motor Co., Ltd. (SFTM). In May 2012, however, it was announced as one million units.
  500,000 units by GAC Toyota Motor Co., Ltd. (GTMC), announced in August 2013. (Its annual production capacity is 600,000 units.) The 2015 sales target for small cars from A0-segment to A-segment with low-end to high-end models, is 200,000 units. As of August 2013, small car sales accounted for approx. 5% of GAC Toyota's sales, which will be raised to approx. 40% in 2015.
"Yundong/Cloud Action Plan", the new China business plan * Toyota will expand businesses in China in the following three phases of strategies.
<Phase I>
 In 2012, Toyota originally aimed to sell one million vehicles, including the Lexus brand cars, in China. Anti-Japan demonstrations/boycott of Japanese cars in late 2012, however, negatively affected sales to result in 853,500 vehicles released by Toyota.
 Another target, building a sound foundation for energy-efficient/new-energy cars such as PHV and EV, was shelved due to anti-Japan demonstrations.
<Phase II>
 For 2015, Toyota originally set the sales target of 1.6 to 1.8 million units including the Lexus and other import vehicle, which we at MarkLines Co., Ltd. estimates to drop to more realistic one around 1.35 million units due to prolonged effects of anti-Japanese demonstrations. Toyota's joint venture (JV) in China will start production of hybrid vehicles equipped with locally developed/manufactured hybrid components including drive train systems.
<Phase III>
 To establish the business development strategies focused on energy-saving/new-energy vehicles and accelerate launching such vehicles so that as many consumers as possible can experience them.
 Energy-saving/new-energy vehicles should contribute 20% of Toyota's entire sales in China.
Eco-technologies, energy-saving/new-energy vehicles business * To promote omnidirectional strategies for new-energy vehicles by concurrently pursue energy (petroleum)-saving and petroleum-free technologies. Especially, Toyota places strong emphasis on energy-saving/new-energy technologies represented by the "full" hybrid system that combines an electric motor and a gasoline engine to operate a vehicle.
 <Energy saving>
 To promote fuel efficiency (energy saving)/downsizing of vehicles with conventional internal combustion engines. To spread non plug-in type hybrid vehicles as well.
 <Petroleum free>
 Toyota plans to evolve HV to PHV/EV (BEV) and other new-energy vehicles in order to finally depart from dependence on petroleum.
Products
(MONOZUKURI/ conscientious manufacturing)
* To establish an integrated local production system from product/model planning, R&D, to manufacturing based on the local consumers' needs/demands. To supply vehicles which touch the hearts of Chinese consumers in each segment and beyond their expectations.
Plans for local production models * To start manufacturing more than nine new models in total at the local JV plants in the three years of 2013 through 2015. The nine models or more include full remodeling and exclude models to be facelifted.
Breakdown:
 <TFTM/SFTM> More than five models in the three years by 2015
 <GTMC> More than four models in the three years, and one or two models per year for the three years.
Reorganizing and strengthening development operations * To develop auto bodies for joint-ventures with China FAW Group (FAW) and Guangzhou Automobile Group (GAC).
* To develop new-energy components including core technologies and drive train technologies.
* To reorganize parts development operations

Sources: "Toyota Yundong Plan: Toyota's China Vision" announced and launched in March 2012, a Chinese version of the Toyota Global Vision announced in March 2011/ Toyota announcements/media reports.

 

 



To boost vehicle production annual capacity to 1.16 million units

 Reportedly, Toyota has delayed its on-going plans to increase production capacities in China as sales dropped due to anti-Japan demonstrations and boycott of Japanese vehicles around September 2012. As part of the "Yundong (Cloud Action) Plan", Toyota's China business strategy started in March 2012, the OEM had planned a new plant construction with prime candidate sites of Tianjin and Guangzhou in order to achieve 1.6 to 1.8 million-vehicle sales including import by 2015. It has, however, not been announced officially and the completion is anticipated to lag behind the originally scheduled 2014 year-end.

 It has been reported that Toyota is considering expanding its annual production capacity in China from 920,000 units (including 915,000 passenger cars) as of November 2012 to over 1.16 million units in 2015, to over 1.36 million units thereafter and to 1.78 million units in the future, while assessing possibility in sales recovery and growth.


 Toyota has repeatedly explained that it would not make major changes in the China business plans even after the anti-Japan demonstrations in September 2012 and expressed its firm intention to carry them out. It is also conducting a study on construction of a new 400,000-to 640,000-units/year plant with an eye on Tianjin and Guangzhou as most possible sites. The OEM aims to start manufacturing in 2015 globally competitive, next-generation vehicles such as HV equipped with hybrid components locally developed and produced in China. In addition, Toyota has ongoing plans to expand SFTM's plants at Chengdu, Sichuan Province and Changchun, Jilin Province.

 

Toyota: Vehicle production in China (Result of production/capacity by plant and model)

OEM
(location)
Plant Production models
<Future production models in triangular brackets>
Production volume (unit) Annual production capacity (1,000 units)
2011 2012 Jan.-Jul.
2012
Jan.-Jul.
2013
As of the end of Aug. 2013 After expansion
(plan year)
▽JV plants for Toyota brand vehicles
Tianjin FAW Toyota Motor Sales Co., Ltd. New local JV plant <hybrid car、small car with A0-segment to A-segment> (In the planning stage with Tianjin as the most possible site) - 200~320
(in or after 2015)
Xiqing plant of Tianjin Vios 13,281 9,126 7,667 1,857 120 120
Corolla EX
(9th-gemeration Corolla)
120,318 125,870 79,249 86,430
TEDA
(Tianjin Economic-Technological Development Area) plant of Tianjin
Crown
(13th-generation)
30,419 25,861 16,280 11,333 300 300
Reiz (10th-generation Mark X) 65,147 60,316 42,050 32,138
3rd-generation RAV4 100,142 99,381 72,008 53,724
(10th-generation Corolla) 169,730 153,851 105,851 87,312    
Sichuan FAW Toyota Motor Co., Ltd Western plant of Changchun Fengyue Branch 100 300
Eastern plant of Changchun Fengyue Branch Land Cruiser 200 7,314 5,538 2,950 2,290 10 10
3rd-generation Prius hybrid 23 2,451 1,864 215
Chengdu plant 4th-generation Land Cruiser Prado 21,896 18,807 13,133 10,999 *30 (PC is 25 included it.) *50 (PC is 45 included as of the end of 2016.)
Coaster *8,216 *4,951 *2614 *3,083
Total (the JV plant with FAW) *536,486 *506,152 *343,666 *289,381 *560 over *760 (in or after 2015) → *1,100
Passenger car (included) 528,270 501,201 341,052 286,298 555 over 755 (in or after 2015) → 1,095
GAC Toyota Motor Co., Ltd. New local JV plant <hybrid car, small car for emergent country market> (under study, the important site is in Guangzhou city) - 200-320(in or after 2015)
Nansha plant of Guangzhou 6th-generation Camry 131,120 27,278 12,154 23,046 360 n.a.
7th-generation Camry 10,573 116,548 86,477 71,072
6th-generation Camry hybrid 503 0 0 0
Camry Zunrui (7th-generation Camry hybrid) 0 2,237 780 2,789
Yaris 19,008 12,405 8,848 9,167
2nd-generation Highlander 94,447 75,421 46,468 51,411
E'Z 16,875 17,380 11,028 9,965
Total (passenger car only, the JV plant with GAC) 272,526 251,269 165,755 167,450 360 600 (in 2015)→ 680
Grand total *809,012 *757,421 *509,421 *456,831 *920 over *1,160 (in 2015) → over *1,360 (in or after 2015) → *1,780
Passenger car (included) 800,796 752,470 506,807 453,748 915 over 1,155 (in 2015) → 1,355以上 (in or after 2015) → 1,775

▽Plant manufacturing Chinese brand Toyota vehicles under license

OEM
(location)
Plant Model Production volume (unit) Remark
2011 2012 Jan.-Jul.
2012
Jan.-Jul.
2013
Brilliance Jinbei Automotive Co., Ltd. Shenyang plant Jinbei Grace (Granse) 17,760 17,219 10,432 9,706  The models based on the second/third-generation Toyota Granvia are sold under the Grace brand of Brilliance Auto Group.
Note 1. Figures noted with * are either for commercial vehicles or for commercial vehicles and passenger cars combined. The same will apply hereafter.
2. Production of the tenth-generation Corolla discontinued in July 2013 at SFTM's Changchun Plant, where the new, fourth-generation RAV4 production started in August, the next month. The tenth-generation Corolla production therefore has been concentrated at TFTM's Tianjin (TEDA) Plant. Production of the previous RAV4, the third-generation, at TFTM finished by July 2013 and the new, fourth-generation RAV4 production has then been consolidated into SFTM's Changchun west Plant.

(Reference)

Daihatsu: Plant manufacturing the FAW brand Daihatsu Xenia under license in Jilin, Jilin Province
OEM
(location)
Plant Production model Production volume (unit) Remark
2011 2012 Jan.-Jul.
2012
Jan.-Jul.
2013
FAW Jilin Automobile Co., Ltd. Jilin plant Senya series(base of Xenia) 41,606 39,895 21,297 23,876  A joint production venture started in June 2007, which was dissolved and replaced by license production in July 2009. The brand has been changed to FAW from Daihatsu since then.
Hino: Commercial vehicle JV plants in Guangzhou, Guangdong Province/Shenyang, Liaoning Province
Joint venture Plant Production model Production volume (unit) Annual capacity
2011 2012 Jan.-Jul.
2012
Jan.-Jul.
2013
As of the end of July 2013 After expansion(plan year)
GAC Hino Motors Co., Ltd. Guangzhou Plant Heavy-duty trucks 2,994 4,197 2,746 3,339 *3 *20
Semi-trailers
(GVW: above 25 tons up to 40 tons)
767 977 451 679
Light-duty trucks 235 323 192 97 *5 *30
Shenyang Plant Middle/high-class large buses 126 313 35 59 *2(the other of chassis' annual capacity is *2.5) *4(the other of chassis' annual capacity is *5)
Total(commercial vehicle with Hino or GAC brand) 4,122 5,810 3,424 4,174 *10 *54

 

To raise production capacity at complete vehicle plants

 Sichuan FAW Toyota Motor Co., Ltd. (SFTM) will increase the production capacity at Chengdu Plant to 50,000 vehicles/year

 The JV partners signed the contract in July 2013 to expand SFTM's Chengdu Plant in Sichuan Province in order to increase production of the 2.7-liter Land Cruiser Prado. The total investment will be CNY 1 billion. Construction is scheduled to commence in 2013 and to be completed by the end of 2016.
 The complete vehicle production capacity at the Chengdu Plant will then increase from current 30,000 to 50,000 vehicles/year. The annual capacity for the 2.7-liter Land Cruiser Prado will increase by 20,000 units. Concurrently, SFTM will begin manufacturing core components including autobody and chassis at the Chengdu Plant.
 In May 2010, the Chengdu Plant was relocated to Chengdu Economic & Technical Development Zone in the suburb from Chenghua, Chengdu. Its annual output capacity as of August 2013 totals 30,000 units, consisting of 25,000 Land Cruiser Prado SUVs, SFTM's flagship SUV, and 5,000 Coaster midsize buses. As of November 2012, 2,240 employees work at the site of 455,000 square meters.


 SFTM started operations at Changchun western Plant and began manufacturing the fourth-generation RAV4.

 SFTM has a plan to boost the production capacity of Changchun western Plant of Changchun Fengyue branch at Xixin Economic & Technical Development Zone in Changchun, Jilin Province, from current 100,000 units/year to 300,000. Combined with Changchun eastern Plant, SFTM Changchun capacity may amount to 310,000 units/year.
 In May 2012, construction of Changchun western Plant at the site of 970,000 square meters was completed and its operations commenced with a total investment of CNY 4 billion. The plant has started with 2,000 employees. SFTM Changchun therefore has a combined total of 2,969 employees with those at the existing 75,000-square meters Changchun east Plant.
 When operations started at Changchun western Plant in May 2012, Toyota manufactured at the plant the tenth-generation Corolla, its flagship sedan, which had also been produced at TFTM's Tianjin (TEDA) Plant. In July 2013, however, the Changchun western Plant ceased the tenth-generation Corolla production, which is now concentrated at the TEDA Plant. Since August 2013, the Changchun western Plant has been producing the new, fourth-generation RAV4.
 Before commencement of the new, fourth-generation RAV4 production at the Changchun western Plant, Toyota discontinued production of the previous RAV4 at the Tianjin TEDA Plant. Production of the new RAV4, upgraded with the new MC platform also used in the tenth-generation Corolla, has been integrated into the Changchun western Plant.  The excess capacity at TFTM's Tianjin TEDA Plant due to discontinuation of the third-generation RAV4 will be used for new models including the next-generation Corolla and its derived models.

New passenger car plants with combined output capacity of over 400,000 units under study with Guangzhou/ Tianjin as the most possible sites

 ▽GAC Toyota Motor Co., Ltd. (GTMC) plans a 200,000 to 320,000-unit/year-passenger car plant at Guangzhou as the most possible site.

 According to media reports in June 2012, Toyota's JV in Guangzhou, GTMC, planned its third plant with Guangzhou, Guangdong Province as a major candidate site. Reportedly, it should achieve the production capacity of 200,000 to 320,000-passenger cars/year by the end of 2014. Although Toyota has not officially announced the new plant construction plan, a GTMC executive revealed in August 2013 that its current passenger car production capacity of 360,000 units/year should be expanded to 600,000 units by 2015.

 ▽Tianjin FAW Toyota Motor Co., Ltd. (TFTM) plans a 200,000 to 320,000 -unit/year passenger car plant at Tianjin as the most possible site

 It was also reported in June 2012 that Toyota's JV in Tianjin, TFTM, planned its fourth plant with Tianjin as a major candidate site. The production capacity to be achieved by 2015 was reported as 200,000 to 360,000 passenger cars.

 

To develop production operation for HV/EV: to start production them in a local JV plant from around 2015

 Sichuan FAW Toyota Motor Co., Ltd. (SFTM) started KD assembly of the third-generation Prius hybrid at Changchun Plant

 In December 2011, SFTM started complete knockdown (CKD) assembly of the third-generation Prius hybrid sedan at its Changchun east Plant (Dongfeng St., Changchun, Jilin Province), to follow the second-generation which the plant had produced since 2005, and released the model in February 2012. Toyota announced in April 2013 that it plans local production of the core hybrid components as it plans to manufacture the HV locally in a real sense after 2015, shifting from the CKD assembly.
 Import and sale of the Prius PHV sedan in China scheduled at the end of 2012 were forced for suspension due to negative effects of the anti-Japan demonstrations in late 2012. It will, however, be launched as early as 2013, according to FAW Toyota Motor Sales Co., Ltd. (FTMS), a JV sales company.

 (Reference)
Jointly with the Chinese government's think tank, Toyota conducted PHV/EV passenger car road tests in China.

 In order to collect data on new energy vehicles (PHV/EV) adaptability and market response in China prior to the Prius PHV sales, Toyota conducted public road tests, jointly with China Automotive Technology and Research Center (CATARC), a Chinese government's automotive think tank.

 ▽Specifications of the Prius PHV for demonstration & road test in China

 【Production plant】TMC's Tsutsumi Plant, Japan 【Dimensions】Length: 4460mm/width: 1745mm/height: 1490mm/wheelbase:2700 mm 【Power system】 ①Gasoline engine: max output of 3kW (99ps)/5200rpm; displacement: 1.8L ②Motor: 3JM, AC synchronous, max output of 60kW/82ps ③Secondary battery for activation: lithium-ion battery; charging time: 3h via AC100V, 1h40m via AC200V 【EV mode】 Maximum speed: 100km/h, maximum cruising distance: approx. 20km (EC mode) 【Others】 Fuel efficiency (EC mode): 2.6L/100km, CO2 emission: 59g/km

 

 GAC Toyota Motor Co., Ltd. (GTMC) began producing the 7th-generation Camry Hybrid at Nansha Plant, Guangzhou

 GTMC started manufacturing "Camry Zunrui", the 7th-generation Camry hybrid at the Nansha Plant, Guangzhou in Jun 2012. The suggested retail prices of the three models range from CNY 259,800 to 329,800.
 In April 2010, GTMC commenced manufacturing the 6th-generation Camry hybrid as its first hybrid production at the Nansha Plant, which discontinued in 2011.

 To produce HV/EV equipped with hybrid components developed and manufactured locally in China around 2015

 Toyota plans to manufacture HV and EV at its JVs in China from around 2015.

 ▽At FAW-Toyota JV plants

 At a production joint venture with China FAW, Toyota plans to start manufacturing hybrid passenger cars around 2015. Equipped with hybrid components including drive train systems locally developed and manufactured in China, the model will be marketed under the Toyota brand. Although the specific plant has not yet been revealed, TFTM's plant at Tianjin is regarded as the most powerful candidate.
 In addition, SFTM will start production of its JV's original brand "Ranz" EV sedan, around 2015. As with the made-in-China HV, it will mount locally developed and produced core components. At the Shanghai auto show 2013, the JV unveiled the concept Ranz EV as well as the Ranz brand. The launch of the production model is scheduled for 2014.

 ▽At GAC Toyota Motor Co., Ltd. (GTMC), a JV plant with Guangzhou Automobile Industry Group Co., Ltd.

 At GTMC Nansha Plant, the JV plans to start manufacturing its own brand EV hatchback around 2015 in addition to the hybrid passenger car. This will also mount locally developed and produced core components including drive train systems. At the 2013 Shanghai auto show, Toyota revealed the concept car, on which this EV hatchback will be based, as well as its brand logo. The brand name has not been announced yet.

 

Studies have begun for local Lexus production

 Toyota is considering the production of the Lexus luxury cars in China, Senior Managing Officer Hiroji Onishi told to the press at the 2013 Shanghai auto show. He predicted that it should take some time to start the production, as the Lexus should first increase its sales in China and build a stable local parts supply system. Although he did not reveal details such as a production plant and models, it has been reported that GTMC's plant in Guangzhou is the most possible candidate and the ES midsize sedan is most likely to be the first model. In order to increase sales, Lexus China launched a campaign in August 2013 to improve the brand image.
 Lexus plans to aggressively launch models equipped with Toyota's world-leading hybrid technologies and 2.0-liter or less compact models into the China market as the luxury brand strategy for China.
 Lexus aims to increase the hybrid model share in the whole Lexus sales in China from 7% in 2011 and 23% (14,700 units) in 2012 to 25% (20,000 units) in 2013 and 50% in 2015. (The Lexus HV luxury passenger car accounts for over 80% of the HV luxury passenger cars in China in 2012, which shows the high competitiveness of the model.)
 Lexus China aims to import and sell 80,000 units of the brand's luxury cars in 2013. Although it set 88,000 units target for the previous year, 2012, sales drastically fell after the unexpected anti-Japan demonstrations to 64,000 units (though it was up 14.3% y/y),  well below the full-year target.

Note: The annual sales over 100,000 units in China has been a precondition for the Lexus brand cars to be locally manufactured in China.

 

 



To develop and produce fuel-efficient gasoline engines, CVT, and  new-energy powertrains

 Toyota announced in April 2012 its major challenge in China. The company would replace all the internal combustion engines already mounted on the models currently sold in China by the fuel-efficient types, in addition to its efforts to promote new-energy vehicles such as HV, PHV, and EV.

 For this purpose, its engine plant at Guangzhou started in October 2011 manufacturing the in-line four-cylinder, naturally aspirated Toyota AR engine (2.5L/2.7L and 2.5L for HV) and its major components, which enjoys good reputation for its running performances and fuel economy. The engine plant at Tianjin followed with the announcement in July 2012 that it would add a fuel-efficient gasoline engine to its product lineup. Toyota is also proceeding with plans to start manufacturing more energy-efficient transmissions from 2014, which includes the construction of a new plant for continuously variable transmissions (CVT) at Changshu, Jiangsu Province.


 Toyota revealed another plan to form a new production JV at Changshu with partners including Primearth EV Energy Co., Ltd. to manufacture nickel-metal hydride batteries to drive new-energy vehicles from around 2015. As early as 2014, Toyota will begin producing core components including drive train systems. The system will be developed by Toyota Motor Engineering & Manufacturing (China) Co., Ltd. (TMEC), its Chinese R&D center to be fully constructed in 2013 for new-energy drive train components. Around 2015, the new components will be mounted on the HV passenger cars to be manufactured at its JV in China.

Production operations at Toyota's engine JV plants in China

OEM
(location plant)
Plant Production engine model Production volume (unit) Annual capacity
(1,000 units)
Employee
(unit)
Remark
2011 2012 Jan.-
Jun.
2012
Jan.-
Jun.
2013
(as of the end of Aug. 2013) (as of the end of Nov. 2012)
Tianjin FAW Toyota Engine Co., Ltd. Tianjin First plant Upgraded A type for 10th-generation Corolla 361,426 317,510 179,230 166,542 150 1,783 Production of ZZ type discontinued in May 2007.Added highly efficient new engines.
Tianjin Second plant ZR type for Vios/Corolla EX 220
FAW-Toyota (Changchun) Engine Co., Ltd. Chang-
chun plant
V6 (2.5L/3.0L) 95,795 86,677 50,137 37,644 130 842 Supplying to FAW Car Co., Ltd.
GAC Toyota Engine Co., Ltd. Guang-
zhou Nansha plant
AZ type (2.0L/2.4L, 2.4L for HV) In-line four cylinder naturally-aspirated AR-type (2.5L/2.7L, 2.5L for HV) 278,485 386,952 233,843 202,291 500 1,586 Production of AR type for HV started in April 2012
Total 735,706 791,139 463,210 406,477 1,000 4,211 Plans for engine production expansion: uncertain
(Reference) Hino's engine production JV in China
Joint venture Plant Production models Production Volume (unit) Annual capacity (1,000 unit) Employee
(unit)
Remarks
2011 2012 Jan.-
Jun.
2012
Jan.-
Jun.
2013
(as of  the end of Aug. 2013) (as of the end of Nov. 2012)
Shanghai Hino Engine Co., Ltd. Shanghai Plant Commercial vehicle diesel engines 21,512 15,659 10,020 8,840 25-30 n.a. There was a plan to boost the annual capacity to 45,000 engines.

Note: According to Nikkei Shimbun (Nov. 20,2010 &Jul. 20,2011) and Nikkan Kogyo Shimbun (Oct. 11,2010, Jul. 18,2011 & Jul.28,2011), Toyota plans to boost its engine production capacity in China from current 1 million units to 1.3 million units by investing JPY 20 to 30 billion in 2013 to build three production lines. Each line will be capable of producing 100,000 units of small car engines (small displacement/high efficiency) per year. The progress, however, remains unknown. Reportedly, Tianjin FAW Toyota Engine Co., Ltd. (TFTE) will build one line for the 1600 cc/1800 cc ZR engines and another line for 1300 cc/1500 cc NR engines, while GAC Toyota Engine Co., Ltd. (GTE) will build one line for NR engines.

 

To add a new, highly efficient engine to the lineup at the engine production subsidiary in Tianjin.

 In July 2012, Toyota revealed its plan to add a new, more fuel-efficient gasoline engine to the lineup of its engine production subsidiary in Tianjin, Tianjin FAW Toyota Engine Co., Ltd. (TFTE). Progress as of August 2013, displacement and other details have not been revealed.

 Toyota's passenger car JV TFTM's TEDA No. 2 Plant started a new, cast parts line in April 2013 for the AR engines, also manufactured at GAC Toyota Engine Co., Ltd. (GTE). It is assumed to be a part of Toyota's scheme to establish the new-type engine manufacturing operations in Tianjin. Toyota has announced that Toyota Motor Engineering & Manufacturing (China) Co., Ltd. (TMEC), its new R&D center in Changshu, Jiangsu Province, will develop engines including hybrid engines for the China market.

 

Parts production subsidiary in Changshu, Jiangsu Province to manufacture CVT from September 2014

 In July 2012, Toyota Group established its wholly owned CVT production subsidiary, Toyota Motor (Changshu) Auto Parts Co., Ltd. (TMCAP), in Changshu, Jiangsu Province. It will start supplying drive train parts, mainly CVTs, in September 2014. The annual CVT output capacity will be 240,000 units/two shift operations. 850 employees will be hired.
 The subsidiary is located at the Changshu Southeast Economic Development Zone, 2km northeast of Toyota Motor Engineering & Manufacturing (China) Co., Ltd. (TMEC), Toyota's R&D subsidiary in Changshu whose construction started in October 2011. The total area is 140,000 m2. The capital amount is USD 95 million. The initial investment totals USD 285 million. TMC holds 70.5%; TMCI (Toyota's subsidiary responsible for its businesses in China) holds 19.5% and Toyota Motor Hokkaido, Inc. holds 10.0%. This CVT subsidiary will also have development functions.

Toyota to jointly produce nickel hydride cells for HV at Changshu, with Primearth EV Energy and others

 TMC and its Group company, Toyota Tsusho Corp. revealed in May 2013 that they will establish Corun Peve (China) Automotive Battery Co., Ltd. at Changshu, Jiangsu Province, jointly with Primearth EV Energy Co., Ltd., a Japanese supplier of nickel-metal hydride batteries for automotive application, Hunan Corun New Energy Co., Ltd., a Chinese battery supplier, and another one. The JV will supply nickel-metal hydride cell modules to drive HV and other vehicles The five JV partners have already signed the agreements. If it makes good progress, the production will commence around 2015.
 The JV will be capitalized at JPY 5.21 billion and the total investment will amount to JPY 15.63 billion. Capital structure: TMCI 5%, Toyota Tsusho 4%, Primearth EV Energy 41%, Hunan Corum New Energy 40% and Changshu Xinzhongyuan Investment Co., Ltd. 10%.
 The JV will be engaged in development, sales and services of nickel-metal hydride cell modules as well as production. It is part of Toyota's scheme to locally manufacture hybrid components at its plant at Changshu as early as 2015.

 

 



To reorganize development structure; start local development of new-energy technologies

 In order to increase its market share in China, Toyota has accelerated and strengthened its efforts to reorganize and structure its local R&D operations with focus on the new generation vehicles, so that they should be able to cater to different development phases of automotive element technology, parts and vehicles.

 While reorganizing and strengthening development operations for vehicles to be supplied to JVs with FAW and GAC, it is working on building development operations for its own element technologies that include the core, new-energy technology as well as their applications such as drive train components. Through such reorganization, the existing R&D Center at Tianjin now focuses on parts development. Toyota is accelerating development of core components such as hybrid systems that includes element technologies and drive train systems in order to locally produce and sell them around 2015.

 

Toyota and FAW set up R&D joint venture in Tianjin to reorganize/strengthen R&D operations for JV plants

 Toyota and FAW Group integrated R&D operations of their existing JVs, TFTM's R&D Center and SFTM's engineering departments into a new R&D subsidiary, FAW-Toyota Technical & Research Development Co., Ltd. (FTRD) in November 2012. It is located at Tianjin TEDA West Zone. Construction of its new facilities began in August 2013.
 The phase I of the construction is scheduled to be completed as early as May 2015. FTRD has already started operations since May 2013 at the new building of TFTM's former R&D Center, completed in July 2010 at the site of TFTM. As soon as the construction is completed, FTRD will move in to the new facilities.
 FTRD will mainly develop platforms of technology, auto body, policy/legislations and information exchanges for Toyota and FAW in order to develop vehicles for Toyota-FAW JV plants. In addition to supporting sustainable development of the JV businesses and providing services, FTRD aims to quickly respond to local needs and to promote the Ranz brand.
 Capitalized at CNY 800 million. The total investment: CNY 1.27 billion. Capital structure: TFTM 80%, SFTM 20%. The site area is 112,000 m2, which has a designing building, a new energy laboratory, a complete vehicle laboratory, a parts laboratory, a design room and trial production facilities. Approx. 300 researchers and engineers as of August 2013 will be increased to over 1,000 in the future.

Note: Toyota also plans to improve operations to develop vehicles for GAC-Toyota JV (GTMC). GTMC R&D Center, responsible for development of vehicles to be manufactured at GTMC, has its own building, whose construction was completed in 2010. Current 200 researchers and engineers will be increased to 500 in 2020.

 

Toyota established R&D subsidiary in Changshu near Shanghai for new-energy technologies

 Toyota broke ground in October 2011 to build headquarters of Toyota Motor Engineering & Manufacturing (China) Co., Ltd. (TMEC), established in November 2010 at Changshu Southeast Economic Development Zone, Jiangsu Province, in the suburb of Shanghai. TMEC will develop HV and other new energy vehicles and core components for such vehicles' drive systems. Operations started in the spring of 2013 at a part of completed facilities and all of them are scheduled to be ready for full-scale operations by the end of 2013. 200 employees at the time of establishment will be increased to 260 for full-operation, and to over 1,000 in the future.
 TMEC is 100% owned by TMC. It is capitalized at USD 234 million and the total investment is USD 689 million.  The 69,000-square-meters-headquarters are built at the site of 2.34 million square meters. It has a 740,000-squre-meters- area for all the test courses including a 5.2 km loop high-speed proving ground, an endurance test course with all the rough roads possible in China duplicated and a performance evaluation test course. TMEC will also build facilities for engine/chassis performance tests and hybrid power train R&D.
 Toyota positions TMEC as the Group's major R&D center overseas for Toyota's state-of-the-art core technologies such as "environmental technology" and "basic technology." It will examine actual things, research and develop jointly with local staff of the Group. TMEC will also play a significant role in providing attractive and safe eco-cars at optimum prices to Chinese customers by quickly grasping local situations including the vehicle usage environment and the market needs in order to reflect them in developing products for the local market including engines.
 TMEC has a team to develop new-energy drive train technologies and plans to produce new-energy components of its own  from around 2015 at Toyota Motor (Changshu) Auto Parts Co., Ltd. (TMCAP), which is currently under construction. The components will be mounted on HV/EV, whose production at a local JV will start from around 2015 as well.

*Note: "Environmental technology " includes new-energy technology such as HV technology, technology for local production of the related core components, engineering matching with vehicles to mount such components, experimental road tests of PHV/EV and other new-energy vehicles and R&D of vehicles with more fuel-efficient combustion engines.
  "Basic technology" includes vehicle technology, material/environment/traffic system research and joint projects with research institutions and universities.

 ▽Toyota Motor Engineering & Manufacturing (China) Co., Ltd. (TMEC): Progress of construction

 In February 2013, TMEC started operation of the engine test bench, its first experimental installation at Changshu headquarters. It held a ceremony to ignite the test engine.
 In February 2013, its new office building was completed in Changshu and commenced operations officially.
 In June 2013, a part of its test courses opened. It held an opening ceremony and showed test-driving performances.
 In the fall of 2013, its facilities for Energy-efficient & New-energy vehicles Development Center (green vehicle development center) are scheduled for completion and operation startup.
 Towards 2013-year end, all its test courses will be completed and full operations will commence.

 

Reorganizes existing Tianjin technical center into parts development center.

 Along with establishment of Toyota Motor Engineering & Manufacturing (China) Co., Ltd. (TMEC), its R&D subsidiary in Changshu, Jiangsu Province, Toyota has integrated and reorganized Toyota Motor Technical Center (China) Co., Ltd. (TTCC), its existing 100%-owned development subsidiary, capitalized locally in Tianjin, into a subsidiary specialized in development of parts for local production. It is also incorporated locally and the corporate name remains the same.
 Toyota has also reorganized and merged TTCC's previous Beijing Branch "TTCC Beijing Branch", and Shanghai Design Center "TTCC Shanghai Design Center" into TMEC's Beijing Branch and Shanghai Branch. The reorganized Beijing Branch promotes technology exchanges with prestigious universities and research institutions in China and collect/organize automotive information. The reorganized Shanghai Branch is responsible for automotive designs as well as researches on Chinese customers' preferences and the China market trends.

<Automotive Industry Portal MarkLines>