The new facility will be located at Shah Alam, and will cost an estimated US$273.8 million to build. It will be built by a joint venture involving Toyota Tsusho and Malaysian conglomerate UMW Holdings, called UMW Toyota Motor. Slated to be ready by early 2018, the new plant will produce small cars, with an annual capacity potentially rising to 100,000 vehicles.

New-car sales in Malaysia totalled 660,000 vehicles in 2015, ranking third in the region behind Indonesia and Thailand.

The Japanese automaker froze construction of new plants in 2013, responding to the deteriorating sales stemming from a drop in demand after the global financial crisis. It has focused instead on using existing facilities efficiency and developing equipment that is cheap to install. It ended its freeze last year, and is working on new plants in China and Mexico, which are slated to be completed in 2017 and 2019 respectively.