Lexus plans to launch a new electric SUV in 2027, marking the brand's first vehicle production in China in over 20 years. The model will be manufactured at a new, wholly owned facility in Jinshan, Shanghai, which Toyota began constructing in June 2025.
The company aims to utilize advanced manufacturing techniques, including gigacasting, to lower production costs and increase output speed. Production capacity is expected to reach approximately 1,000 units per month in 2027, with plans to scale to tens of thousands of vehicles in 2028.
This shift in strategy comes as Toyota faces declining sales in China, which fell by nearly 20% last month. During the first nine months of 2026, the company sold just over 1.05 million vehicles in the region, representing an 18.9% decrease compared to the same period in 2025.
By developing the SUV locally, Toyota intends to accelerate its development cycle to compete with domestic brands like BYD. The project is part of a broader effort to leverage China's innovation and supply chain to improve Toyota's market position in its third-largest global market.
