Toyota Motor will receive a roughly $853 million (120 billion yen) subsidy from the Japanese government to expand the production of electric vehicle batteries, in a bid to boost domestic output and become less dependent on Chinese-related supply chains, according to Nikkei.

The monetary aid comes as Japanese companies – led by Tesla supplier Panasonic – hold less than a 10 percent share in automotive battery usage, while Chinese suppliers – mainly CATL and BYD – control more than half, according to SNE Research, quoted by Nikkei.

Toyota said that it will use the money to develop the next generation of lithium-ion EV batteries which use bipolar lithium iron phosphate technology and have the potential to offer 20 percent more range in electric vehicles and cost around 40 percent less than the current generation lithium-ion batteries used in the Toyota bZ4X crossover.

Gallery: Toyota bZ Sport Crossover and bZ FlexSpace Concepts

The Japanese automaker will likely put the next-gen battery into production around 2026 or 2027 when EVs based on a purpose-built platform will come to market with an advertised range of around 600 miles (965 kilometers) on a single charge.

Additionally, Toyota will use a part of the subsidy for the research and development of its all-solid-state batteries which will supposedly increase the driving range of its EVs by around 20 percent, compared to the bipolar LFP packs, which translates into roughly 720 miles (1,158 km) of zero-emissions travel.

Earlier this week, the Nippon car group which currently sells just two all-electric vehicles in the United States – the Toyota bZ4X and Lexus RZ crossovers – unveiled an ambitious plan that will result in an all-new EV platform in 2026 and newly developed EV batteries reportedly capable of delivering up over 900 miles (1,448 km) of range after 2028.

Moreover, the Aichi-based company wants to cut down manufacturing costs by employing giga cast methods similar to those used by Tesla, as well as improve the aerodynamic properties of its upcoming battery-powered models as much as possible.

Toyota plans to launch 10 new BEVs by 2026 and will produce an all-new electric SUV in Kentucky starting in 2025, as well as investing $2.1 billion in a battery factory in North Carolina.

Besides the increased investment in the development of new EVs, Toyota will also continue investing in hybrid electric vehicles and hydrogen-powered vehicles.

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