Toyota Motor Corp. plans to start producing electric vehicles in the United States possibly in 2025, a source close to the matter said Wednesday, with an eye on the growing market for eco-friendly cars amid tougher environmental regulations.
The move by the Japanese automaker comes as a U.S. law enacted last year to incentivize the use of green technology requires final assembly of EVs to occur in North America to qualify for tax credits.
Toyota, which has set a goal of selling 3.5 million EV units worldwide in 2030, is also considering producing vehicles in Europe.
The production of EVs in the United States -- possibly SUVs -- is expected to start between 2025 and 2026 at a key manufacturing plant in the southern state of Kentucky, according to the source.
Toyota, together with trading firm Toyota Tsusho Corp., is also planning to build an automotive battery plant in nearby North Carolina, with operations slated to begin in 2025.
Toyota launched its first mass-produced electric vehicle known as the bZ4X in May last year. It is manufactured in Japan and China.
Koji Sato, who is set to become the president of Toyota in April, told a recent press conference that the company will "speed up EV development" but also continue to offer a broad range of electrified vehicles, including EVs and hybrids.