Toyota will produce its first European electric car at its plant in the Czech Republic.

This was announced by the company's European president, Yoshihiro Nakata, during a ceremony at the Czech government office, EuroNews reported.

The company will partner with the Czech government to expand its production line and build a new battery assembly facility at Toyota's existing plant in Kolin, about 50 km east of Prague.

For Toyota, this decision is the next step in its strategy to achieve carbon-neutral operations in Europe by 2040, the company said in a statement.

"This advanced technology project will strengthen our presence in the European market and contribute to more efficient transportation alongside our other solutions," said Nakata, president and CEO of Toyota Motor Europe, during the event.

The production of the new electric vehicle and batteries represents a €680 million investment by Toyota, including a government incentive of up to €64 million.

"The expected benefits for the country amount to €250 million," said Czech Minister of Industry and Trade Lukas Vlcek. 

Prime Minister Petr Fiala said that the new line will create another 245 jobs at the factory, which already employs 3,200 people.

"The automotive industry accounts for about 10% of our GDP, and if we want to keep it, we need to modernize it systematically. Projects like this are crucial for the future of the Czech automotive industry," Fiala said.

Toyota has not disclosed details about the start of production or the model of the car.

The global automotive leader currently produces the Aygo X and Yaris Hybrid models at the plant, which produced over 225,000 cars last year. | BGNES