By Daniel Leussink and Maki Shiraki
TOKYO (Reuters) -Toyota Motor Corp's chief executive on Friday gave a stark assessment of the Japanese automaker's work ahead in China, saying it must move faster as its competition in the world's biggest auto market surges.
Toyota is under pressure in China from local brands such as BYD Co (OTC:BYDDF) Ltd that have moved aggressively in tapping into the country's growing market for battery-powered and plug-in hybrid electric vehicles (EVs).
"We need to increase our speed and efforts to firmly meet the customer expectations in the Chinese market," Toyota CEO Koji Sato, said during a roundtable interview with members of the foreign media in Tokyo.
"Considering the impact of the Shanghai motor show, I believe China will become an advanced market for EVs."
The world's biggest automaker by sales used the Shanghai show this week to unveil two new EVs, a move that will double the number on offer in China under its mainstream brand.
The company said this month it will launch 10 new battery-powered models and establish a specialised unit to focus on next-generation battery EVs, as it seeks to step up its foray in battery EVs under its new leadership.
Sato on Friday acknowledged that Nagoya-based Toyota was producing a small volume of battery-powered vehicles compared to other automakers, adding the company was taking a phased approach to accelerate the battery EV rollout.
The first phase of that plan is marked by improving battery EVs following the launch of the company's first models. After that, Toyota aims sell an annual 1.5 million battery EVs in 2026.
Toyota last year sold just 24,466 battery EVs worldwide, including those of its luxury Lexus brand, accounting for 0.25% of its global sales of 9.5 million vehicles. Of those, 2.7 million were hybrids and fuel-cell vehicles.