Chinese cities boost Toyota’s hunt for hybrid buyers – Salt Lake Tribune

Posted: Saturday, December 05, 2015

More Chinese cities are adopting the plate restrictions to control the number of autos on their roads and promote greener cars.

These lotteries are routinely undersubscribed. Getting a plate for a gas engine-powered car is far more difficult. In Beijing, for example, a consumer has 0.5 percent chance of winning a plate in lotteries held every two months.

“Toyota has done its part to localize production and lower costs,” said Zhang Yi,a Tokyo-based auto industry consultant at Nomura Research Institute. “The government support is the last step they need to reverse hybrid’s fate in China.”

Under the new arrangement in Tianjin and Guangzhou, Toyota’s newest China models will get a marketing edge as the Japanese carmaker plays catch-up with Volkswagen and General Motors in the world’s largest auto market.

Toyota agreed to localize development and production of hybrid car components after almost two decades of keeping the work contained to Japan.

China has doled out subsidies to electric-car buyers and puts less-stringent purchase restrictions on plug-in autos in urban centers as part of a government strategy to reduce tailpipe emissions and dependence on imported oil.

Conventional hybrids, which run on a combination of a gasoline engine and a battery, have been excluded in the government’s new-energy vehicle programs until now.

The lack of state support has hampered Toyota’s bet that hybrids could be a more realistic solution to reducing emissions, since plug-in cars sold by companies including BYD Co. and Chery Automobile are dependent on still-nascent charging infrastructure.

While Toyota has sold more than 8 million hybrids globally, it delivered only about 1,000 Prius and 5,700 Camry hybrids last year in China.

With Tianjin and Guangzhou getting behind the Corolla and Levin hybrids, Toyota received orders for 8,000 units in the three weeks after their introduction in late October.

That level of hybrid demand is unprecedented for the carmaker, which first introduced the gasoline-electric Prius to the China market in 2005.

The FAW Toyota joint venture plans to increase production of Corolla hybrid next year by as much as 15 percent to 45,000 units, said Zhang Sijun, a general manager of marketing planning division. This would boost both FAW and local Chinese battery supplier Hunan Corun New Energy Co.

“Toyota has taken 10 years to sharpen a sword,” Hiroji Onishi, Toyota’s chief executive officer for the China region, said last month at the Guangzhou Motor Show. “This year marks the start of a hybrid era in China.”

Beijing made its lotteries for gasoline cars more stringent from last year as part of efforts to contain tailpipe emissions.


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