Tokyo  - The world's biggest carmaker Toyota Motor Corp plans to build a research and development centre in China, the Japanese business daily Nikkei reported Thursday.

The new facility will be established on the outskirts of Shanghai as early as next year, the Nikkei said, but did not give a source for its report.

A Toyota spokesman in Tokyo could neither confirm nor refute the report.

The new facility is to develop models especially for the Chinese market that are highly competitive in price, performance and design, according to Nikkei.

Toyota will become the first Japanese automaker to establish a Chinese R&D centre funded solely by itself.

The Chinese authorities are expected to soon grant approval for Toyota setting up a company to operate the site, the daily said.

The move is intended to strengthen Toyota's position in the Chinese market, which is expected to surpass the United States to become the world's largest car market in 2009.

The R&D centre is expected to employ several hundred personnel. Toyota intends to hire many engineers locally, including those specializing in electronics. (dpa)