The move could help Toyota gain ground in China.
Despite what you think about the Toyota Prius, there is some secret ingredient that makes it by far the best selling hybrid in the world. No other automaker has quite been able to replicate the sales success of the Prius, giving Toyota a huge advantage in the hybrid segment. Other companies desperately want to know the secrets of the Prius, and according to Automotive News, Toyota may be gearing up to divulge them to China.
Speaking to Bloomberg, sources close to the issue said Chinese officials asked Toyota to share its hybrid technology with local automakers to help meet strict emissions targets. Toyota sees this as an opportunity to grow in China, where it has lagged behind Volkswagen and General Motors in terms of sales. The Japanese automaker is currently in talks with Chinese automaker Geely, the same company that currently owns Lotus and Volvo, to license its hybrid system.
China is one of the worst countries in terms of pollution and is keen to switch over to purely electric cars as soon as possible. Seeing as this may not be viable for a number of years, the Chinese government is now seeing the benefits of hybrid technology to reduce emissions on the way towards an all-electric future. China has already offered government subsidies on fully-electric cars but may decide to do the same with hybrids, which would be good news for Toyota.
Of the 1.3 million vehicles Toyota sold in China, around 10% were hybrids - Toyota would like to up that proportion to around 30% by 2020. In addition to Geely, Toyota is in talks with several other Chinese automakers and could make an announcement about a partnership by the end of the year. Sharing its hybrid technology in China may be a risk, but it could be integral to helping Toyota sell more cars in the region.