Section 4. Expanding Business in China through Joint Ventures
Item 1. Production Sites Expanded
Guangzhou Toyota begins production
Based on the results of the reinforcement of the automotive parts industry in the second half of the 1990s, the project with Tianjin Automobile Industry Group moved forward with a plan for a successor to the Xiali, which had been produced through a technology alliance by Daihatsu Motor and Tianjin Automobile Industry Group. The result was the establishment of Tianjin Toyota Motor Co. Ltd., a joint venture with Tianjin Automobile Industry Group, in June 2000 and the start of production of the Vios, a much desired passenger car, in October 2002.
Meanwhile, in August 2002, TMC entered into a basic agreement for the development of strategic and long-term joint business with the China FAW Group Corporation (FAW), the corporate group with which TMC had contacts-including technology exchanges-since the end of the 1970s. FAW, along with Shanghai Automotive Industry (Group) Corporation and Dongfeng Motor Group Co., Ltd., made up China's "Big Three" automobile manufacturers. A collaboration agreement signing ceremony was held that month at the Great Hall of the People in Beijing with FAW President Zhu Yanfeng and TMC President Fujio Cho attending.
Prior to signing the agreement, FAW formed a capital partnership with Tianjin Automobile Industry Group in June 2002 and reached agreement on collaboration with Sichuan Tourer Manufacturing in August of that year. As a result of this series of agreements, TMC, Tianjin Automobile Industry Group, and other joint venture partners established an integrated business with FAW.
In 2003, Tianjin Toyota Motor was reorganized as Tianjin FAW Toyota Motor Co., Ltd. (TFTM). After adding the Corolla to the No. 1 Line of its Xiqing Plant in 2004, TFTM constructed a second line at its Tianjin Economic-Technological Development Area (TEDA) Plant and began producing the Crown and Reiz in 2005. In addition, a third line was constructed at the TEDA Plant in conjunction with the launch of the new Corolla in 2007, and production of the RAV4 began on that line in 2009.
Sichuan Toyota Motor began producing the Prado in 2003, and when Sichuan Tourer Manufacturing's stake in the company was transferred to FAW in 2005, Sichuan Toyota Motor's name was changed to Sichuan FAW Toyota Motor Co., Ltd. (SFTM). Also, Changchun FAW Fengyue Automobile Co., Ltd., which had been producing the Land Cruiser, was put under the umbrella of SFTM, which reestablished it as a subsidiary renamed as SFTM Chanchun Fengyue Co. The new company's production facilities became the first to build the Prius outside of Japan in December 2005. Later, in 2010, SFTM relocated to the Chengdu Economic and Technological Development Zone in the Longquanyi District of Chengdu and constructed a new plant. The new plant increased annual production capacity from the 13,000 units at the former plant to 30,000 units and produced the new Prado.