GAC Toyota Engine (GTE), a joint venture between Toyota and Guangzhou Automobile has started production of a new four-cylinder inline 'AR' engine at its Nansha plant in Guangdong province.

The automaker said that the start of AR engine production at the Nansha plant represents an additional investment of $96m.

The new engine will be available in three configurations: a 2.5-liter, a 2.7-liter, and a 2.5-liter hybrid, with the 2.5-liter type to be used in the new Camry soon to be launched in China.

According to the automaker, the GTE joint venture which was established in 2004 as a supplier for engines and parts in China, started production in 2005 and reached 1 million engines in 2009.

GAC Toyota Engine, which also produces the older 'AZ' model as well as engine parts, has a total annual production capacity of about 500,000 units.