Brazil, which is South America’s largest auto producer, has largely resisted the shift toward electric and hybrid vehicle production that has swept through more developed markets.
Some of Toyota’s competitors in Brazil, including General Motors and Volkswagen AG, have said they will import electric vehicles but do not plan to produce them domestically.
The announcement was made in a news conference hosted by Sao Paulo state governor Joao Doria. Toyota said the car will be produced in the state, at its Indaiatuba plant, which will receive an investment of 1 billion reais(RM1.06bil).
Toyota said in a statement that it made the decision to build the Corolla in Brazil in part thanks to a package of tax incentives passed by the country’s Congress, known as Rota 2030.
Unlike in most markets around the world, ethanol is a common car fuel in Brazil. Toyota already imports the hybrid Prius to Brazil.