Toyota to build Camry hybrids in Australia-source

TOKYO, June 7 (Reuters) - Toyota Motor Corp (7203.T) plans to start assembling hybrid cars in Australia as early as in 2010, a source familiar with the matter said, in a move aimed at achieving its global annual sales goal of 1 million hybrid vehicles soon after 2010.

Toyota, the world's biggest automaker, plans to build a few thousand Camry hybrids a year at the 150,000 unit-a-year Altona factory in Victoria, where it builds the popular Camry sedan and the Aurion sister model. The Camry hybrids will be sold locally.

Australian Prime Minister Kevin Rudd, who is due to visit Japan next week, is scheduled to hold a news conference on Tuesday attended by Toyota President Katsuaki Watanabe. His government has allocated A$500 million towards the Green Car Innovation Fund to encourage development of low-emissions vehicles.

Toyota, by far the world's top seller of gasoline-electric hybrid cars, now builds most of its hybrid vehicles in Japan. In 2006 it began assembling the Prius hybrid in China, and more recently the Camry hybrid at its Kentucky plant in the United States, with imported hybrid system modules.

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

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 also recently bemoaned the strong Australian dollar, which makes its locally produced Camry uncompetitive when exported.

Of the 149,000 vehicles produced at the Altona plant last year, Toyota exported 99,000 to the Middle East.

Tariffs on imported vehicles in Australia are also due to be halved in 2010 to 5 percent, giving automakers less incentive to build locally. (Reporting by Chang-Ran Kim and Nobuhiro Kubo; Editing by Ben Tan)