Toyota to Establish Lexus EV Plant in China by 2027 – Reports

Toyota, the world’s top-selling automaker, is reportedly planning to build an electric vehicle (EV) factory for its luxury Lexus brand in Shanghai, China, by 2027. This marks a significant move as Toyota aims to strengthen its presence in the world’s largest EV market, according to Japan’s Nikkei.

The factory, which would be operated without a local partner, is set to become the first Japanese-owned car factory of its kind in China. Toyota has not confirmed the reports but public broadcaster NHK noted that the facility is expected to help the automaker catch up in the Chinese EV market, where it lags behind domestic and foreign competitors.

Shifting Focus in a Competitive Market

China surpassed Japan as the leading vehicle exporter last year, driven by its dominance in EV production—a segment where Japanese manufacturers, including Toyota, have focused more on hybrid technology. Tough competition and sluggish consumer spending are challenging traditional automakers, prompting Toyota to diversify its offerings to stay competitive.

Toyota’s new Shanghai plant would primarily manufacture Lexus models, which are currently imported into China from Japan.

Japanese Automakers Adapting to Change

Meanwhile, Japan’s second and third-largest automakers, Honda and Nissan, announced plans to merge in response to rapid changes in the automotive industry. Their partnership will focus on strengthening their positions in EV and self-driving technology, with a holding company expected to be listed by August 2026.