Toyota (TM.US) to trial its own "gigacasting" in China for the first time; Lexus Shanghai plant to start production in 2027.

Toyota Motor Corp. Sponsored ADR (TM.US) plans to use its own gigacasting equipment to produce electric vehicles at a $2 billion Lexus plant in China. This is one of Toyota's latest moves to reverse its sales decline in China and enhance its competitiveness. When asked whether Toyota sources gigacasting machines from local suppliers, Toyota Chief Technology Officer Hiroki Nakajima said the company is developing the technology "in-house." The plant in Shanghai is under construction and is expected to start producing cars in 2027. "This is a big opportunity to change the manufacturing system," Nakajima said in an interview in Brussels. "Every transformation starts from within the company." Lexus Shanghai Plant to Trial Gigacasting for the First Time The Lexus Shanghai plant will be the first Toyota plant to use gigacasting machines. The move is also one of Toyota's initiatives to enhance its competitiveness in the Chinese market. Currently, Chinese domestic brands dominate the electric vehicle sector. This technology, known as "gigacasting," was first adopted by Tesla, Inc., and companies such as BYD Company Limited and Xiaomi have also begun using it. Tesla, Inc. CEO Musk once said that "gigacasting technology allows Tesla, Inc. to build new cars like building toy cars." The technology can form an entire chassis section in one piece, replacing dozens of components that previously needed to be welded together, helping manufacturers save time, equipment, labor, and costs. Toyota said it is currently testing the technology in Japan. The company declined to comment on potential suppliers related to gigacasting. The downside of this technology lies in its high cost and poor flexibility when producing different vehicle models. Due to the large size of replacement parts, accident damage tends to be more costly as well. Automakers typically work closely with casting suppliers, such as Italy's Idra Group or China's Haitian, to customize equipment according to their own needs. Sales Under Pressure in China, Toyota Advances Multi-Pathway Strategy Toyota and its European peers have been grappling with weak sales in China. In the first eight months of this year, Toyota's sales in China fell 19%. Nakajima made the remarks at Toyota's technical center in Brussels, where he showcased the company's latest technologies under development, including progress in hybrid engines, electric vehicles, and hydrogen fuel cells. Toyota continues to advance its multi-pathway strategy, covering all types of powertrains. Meanwhile, Toyota is vigorously promoting factory automation to accelerate development speed and is investing billions of dollars in the latest equipment.