UPDATE 3-Toyota to build Camry hybrids in Thailand, Australia

Tue Jun 10, 2008 5:44am EDT

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(Updates with production of Camry hybrid in Thailand)

By Nobuhiro Kubo and Chang-Ran Kim

NAGOYA, Japan, June 10 (Reuters) - Toyota Motor Corp (7203.T) will start assembling its Camry hybrid cars in Thailand and Australia over the next two years in its latest effort to popularise such fuel-efficient vehicles.

Toyota, the world's biggest automaker and a pioneer of gasoline-electric hybrid cars, said on Tuesday it will begin production at its Gateway plant in the Thai province of Chachoengsao, 110 km (68 miles) southeast of Bangkok, in 2009. It aims to produce 9,000 vehicles per year at the plant.

At its Australian factory, it plans a production start in early 2010 and aims to produce and sell 10,000 a year.

With fuel prices hitting record highs around the world, automakers are racing to offer fuel-efficient alternatives such as pure electric and ethanol-fuelled cars. To reach its target of selling 1 million hybrid cars a year in the early part of the next decade, Toyota will need to more than double production of the vehicles.

"We decided to build the Camry hybrid in Australia because Australians are keenly aware of environmental issues including global warming," Toyota President Katsuaki Watanabe told a news conference in Nagoya, central Japan, attended by visiting Australian Prime Minister Kevin Rudd.

Rudd, whose government has allocated A$500 million ($475 million) towards the Green Car Innovation Fund to encourage development of low-emissions vehicles, said Toyota would get A$35 million in grants for Camry hybrid production.

Australia had been looking to host production of hybrid cars for about a year to ease the pressure of rising fuel costs and global warming, he said.

Toyota will assemble the Camry hybrid with imported hybrid modules at its 150,000 vehicles-a-year Altona factory in the suburbs of Melbourne. The plant, which builds the Camry sedan and the Aurion sister model, produced 149,000 vehicles last year, two-thirds of which were exported to the Middle East.

Toyota now builds the Camry hybrid in Japan and in the U.S. state of Kentucky. It also assembles a small number of Prius hybrid cars -- just 320 in 2007 -- at a joint venture factory in China. Honda Motor Co (7267.T), a distant second in the hybrid market, builds all of its hybrids in Japan.

Earlier this year, Australia lost one of its few auto factories after Mitsubishi Motors Corp (7211.T) closed its loss-making Adelaide plant. A Toyota executive had recently bemoaned the strong Australian dollar, which makes its locally produced Camry uncompetitive when exported.

Tariffs on imported vehicles in Australia are also due to be halved in 2010 to 5 percent, giving automakers less incentive to build locally. General Motors Corp (GM.N) and Ford also have factories in Australia.

Toyota increased sales in Australia by 11 percent to 245,000 vehicles in 2007. Of that, it sold 4,200 hybrids, up 75 percent from 2006.

Toyota's Gateway plant in Thailand produces the Camry, Corolla, Yaris and other cars, with an annual capacity of 200,000 units.

Toyota's shares reacted little to the news, falling 0.2 percent to 5,420 yen on Tuesday. The transport sector subindex .ITEQP.T fell 0.5 percent. ($1=1.053 Australian dollar) (Editing by Michael Watson)

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