Japan's Toyota Motor has agreed with Guangzhou Auto to set up a joint venture to produce cars at a new plant in suburban Guangzhou, Asahi Shimbun said. The deal will be announced formally when it has received approval from the Chinese government.When production starts in 2005, it will
initially assemble between 30,000 and 50,000 midsize passenger cars a year and gradually increase its output.
Toyota already has a joint venture agreement with First Automobile Works to manufacture a range of motor vehicles at its site in Tianjin, while Guangzhou Auto has a deal with Honda to produce the Accord sedan.
Toyota president Fujio Cho said tight regulations in China and talk of a fresh overnment
initiative to help domestic carmakers would not deter the group from its investment plans. He added: ï¿½There is no question that we will combine all our resources [toexpand our business in China].ï¿½