In 2018, Toyota Motor will become the first Japanese carmaker to introduce plug-in hybrid vehicles in China. Toyota plans to provide plug-in hybrid models of the Corolla and Levin, which will be manufactured locally, to cater to the growing hybrid market as well as take advantage of government subsidies for eco-cars.

In 2015, Toyota offered conventional hybrid versions of the Corolla and Levin in China. However, China’s government subsidies only cover plug-in hybrid and electric cars. With the introduction of the new-energy vehicles, Toyota can hopefully enjoy Chinese government incentives and sell the cars at more affordable rates. To become qualified for the incentives, the plug-in hybrids and electric cars will have to suffice certain conditions, such as being able to run fully on electric for over 50km or 30 miles after being fully charged.

Hiroji Onishi, a senior managing officer and head of Toyota’s operations in China, said that the recent announcement indicates Toyota’s huge interest in the Chinese market.

"Our decision to launch plug-in hybrid versions of the Corolla and the Levin reflects the depth of our resolve and commitment to the Chinese market," Onishi says in a report by Reuters.

Toyota stated that the rules in China have become more stringent, which made it more difficult for them to hit their sales targets. Onishi did not mention whether Toyota plans to produce the eco-cars in China, although it was a possibility.

Nikkei Asian Review reveals that Beijing plans to maintain the eco-car subsidies until 2020. In 2015, the sales of new-energy vehicles in China has increased by about 400 percent to 300,000 vehicles because of the government incentives. Plug-in hybrids were particularly growing in popularity.

In the eco-car market, Toyota can expect to compete with local carmaker BYD and Honda Motor, among others. BYD is currently a dominant force in the industry, while Honda is also planning to introduce a plug-in hybrid model of the Accord by 2020. More competitors from Japan are expected to enter the market in the next few years.

China is a giant market and has been the No. 1 automobile market in the world for the past seven consecutive years. Even with its current economic slowdown, Chinese auto sales are still set to grow by about 6 percent to 26 million vehicles in 2016.

More updates and details on Toyota’s plug-in and electric versions of the Corolla and Levin are expected soon.

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