Toyota Motor Corp aims to have half of its global sales from electrified vehicles by 2025, five years ahead of schedule, and said it will tie up with Chinese battery makers to accommodate an accelerated shift to electric power.

The change illustrates both the breakneck growth in the electric vehicle (EV) market – which is transforming the global auto industry – and an acknowledgment by Japan’s top automaker that it may not be able to meet demand for batteries on its own.

There “may be a gap” between Toyota’s battery needs and what it could produce, as stringent emissions regulations expected in Europe, Japan and China fuel demand, Executive Vice President Shigeki Terashi told a briefing.

Toyota said on Friday that it would partner with leading Chinese battery maker Contemporary Amperex Technology Co Ltd (CATL), as well as Chinese EV maker BYD Co Ltd for supplies.

The automaker also announced an ultra-compact two-seater designed for daily errands and short-distance business trips, with a maximum speed of 60 km (37 miles) per hour and a range of 100 km on a single charge.

However, Terashi noted that while demand for EVs accelerates, profitability will be slower in coming. EV technology has come a long way since 2010, but it is still a challenge to create a profitable business for them, he added.

Hybrid vehicle sales volumes would be less than battery EV volumes by 2025, with the latter expected to still be fewer than 1 million vehicles, he said.

The Japanese automaker has led in technologies for hybrid and fuel cell vehicles, but it has trailed rivals such as Nissan Motor Co Ltd, Volkswagen AG and Tesla Inc in bringing fully electric vehicles to showrooms.

It has been developing its own lithium-ion EV battery technology for decades, and has teamed up with Panasonic Corp to pool together resources to develop and manufacture rectangular-shaped prismatic batteries in the coming years.

On Thursday, it announced it was teaming up with Subaru Corp to jointly develop a battery-electric sport-utility vehicle (SUV) on a platform produced together as they seek to split development costs.

CATL has built relationships with other Japanese automakers, including Honda Motor Co Ltd and Nissan. It also signed a multi-billion dollar battery supply deal with Volvo Car Group in May.