Toyota JV With Guangzhou Auto - Approved By Bejing

NEW YORK December 19, 2003; Dow Jones reported that the Chinese government has authorized a joint engine project between Toyota Motor Corp. and Chinese automaker Guangzhou Automobile Group Ltd., the Kyodo news agency reported Friday, citing Toyota President Fujio Cho.

Cho made the revelation in Tokyo after attending a press conference.

Toyota Motor and Guangzhou Automobile plan to set up a plant in Guangzhou in the southern China province of Guangdong to produce 500,000 engines a year, Kyodo reported.

As for a project under negotiation between the two automakers to produce passenger cars, Cho said, "I hope it (authorization) will be granted next year."

At the press conference, meanwhile, Cho forecast the yen will weaken in 2004 as the currency is now too strong in comparison with Japan's economic fundamentals, Kyodo reported.

Toyota Executive Vice President Ryuji Araki said at the conference that the dollar is expected to strengthen next year because of the 2004 presidential election in the U.S.

Cho said the Japanese economy will receive various benefits if the bellwether Nikkei Stock Average of 225 issues rises above the 12,000-point mark, Kyodo reported.