GAC to acquire 50 per cent stake in FAW Toyota
GAC plans to enter FAW Toyota and intends to take over the existing 50 per cent stake of a FAW subsidiary. This would bring Toyota's previously separate China partnerships with FAW and GAC closer together.
Image: GAC
As reported by _Reuters_, citing a stock exchange announcement from Guangzhou Automobile Group (GAC), the Chinese automaker intends to acquire a 50 per cent stake in FAW Toyota. The shares are to be transferred from a subsidiary of the state-owned FAW Group to GAC. The transaction will be financed through the issuance of new A-shares, with the issue price set at 5.75 yuan per share. The exact transaction value has not yet been determined and will be finalised only after the completion of ongoing audits and valuations.
According to GAC, the deal is one of the key projects aimed at deepening the strategic cooperation between the FAW Group and GAC. As part of the transaction, the FAW subsidiary in question is set to become the second-largest shareholder of GAC.
For Toyota, the planned shift is particularly relevant because the Japanese automaker has so far operated in China with two separate joint venture structures: FAW Toyota on one side and GAC Toyota on the other. This model is coming under pressure due to slower market growth, high overcapacity, and increasing competition from Chinese electric vehicle manufacturers.
GAC gaining importance for Toyota’s EV business
GAC has recently gained significance for Toyota, particularly in the electric vehicle segment. The jointly developed bZ3X electric SUV achieved around 70,000 registrations in China in 2025, according to market researchers at Marklines, accounting for approximately 70 per cent of Toyota’s battery-electric vehicle sales in the country. Overall, Toyota sold around 100,000 BEVs in China, surpassing the Volkswagen brand, which sold approximately 85,000 vehicles.
Despite this progress, Toyota remains a relatively small player in China’s electric vehicle market. For comparison: BYD sold more battery-electric vehicles in December 2025 alone than Toyota did in the entire year. The increasing pressure on traditional manufacturers is likely to raise questions about the long-term viability of Toyota’s dual structure with FAW and GAC.
With GAC’s planned entry into FAW Toyota, the two previously separate partnerships would at least move closer together at the shareholder level. The announcement does not yet specify what impact this will have on model programmes, production, or Toyota’s further electrification strategy in China.