Toyota, the manufacturer of the Prius hybrid, has joint ventures with First Automobile Works and Guangzhou Automobile Group. As the Japanese automaker has lagged behind its rivals in China, it is seeking to strengthen its collaboration with its partners.
The three will develop a hybrid control system at a research and development facility in Jiangsu Province with an eye to starting production around 2015.
China, plagued by worsening air pollution, has said it will boost production and sales of new energy vehicles, such as electric cars and hybrid vehicles, to more than five million units by 2020.
Toyota Senior Managing Officer Hiroji Onishi said he hopes Toyota's technology for hybrid vehicles will contribute to reducing emissions and improve the environment in China.