Toyota partners with Tencent to appeal to young Chinese drivers

Toyota on Thursday said it will partner with Chinese gaming and social media leader Tencent in China, as the Japanese carmaker aims to meet younger consumers' taste for technology-enhanced cars.

The world's largest carmaker by volume made the announcement at the Beijing auto show that opened to the media on Thursday, and where Japanese carmakers have unveiled a raft of cars aimed at winning over younger Chinese.

The partnership highlights how competitive China has become for overseas carmakers, even for globe-spanning giants such as Toyota.

Tencent's technology will be included in a China-made passenger vehicle that will go on sale this year, said Toyota's Yiming Xu, a director for brand and communications for China.

The companies will offer services through Tencent's strengths in big data, artificial intelligence and cloud computing, Xu said.

Foreign carmakers are working to stay competitive in China amid mounting pressure from a shift to EVs, the rise of domestic brands such as BYD and a price war.

Toyota has seen sales shrink as local brands gained ground, though it has avoided the sharp blow Japanese peers such as Honda and Nissan have taken.

It saw its sales in China fall 1.7% to 1.9-million vehicles in 2023, the second successive year of decline.

Toyota also showed off two new battery electric vehicle models for the Chinese market at the Beijing show.